annual

integrated
report
2017

Social responsibility is
our center of gravity
and all kinds of financial activity
are cycling around the gravitational platform

Annual Integrated Report 2017

1
 Contents

DIRECTORS’ INTEGRATED RISK

REPORT REPORTING MANAGEMENT
58-95 FRAMEWORK
106-144
96-105

Notice 04 INTEGRATED REPORTING FRAMEWORK

Awards and Recognition 06 Our Approach to Integrated Report 97
Vision, Mission and Core Values 08 Deposits and Advances Strategies 98
Bank Asia at a Glance 10 Import and Export Strategies 99
Business Ethics and Codes of Conduct 11 Future Orientation 100
Goals 13 Strategic Focus 101
DuPont Analysis 14 Our Activities and Values 102
Corporate Structure and Corporate 15 Capital 104
Information Our Business Model 175
Corporate Organogram 17
Directors’ Profile 20
RISK MANAGEMENT DISCLOSURES
Bank Asia Foundation 26
From Chief Risk Officer’s Desk 108
Key Events 2017 28
Statement of Non Performing Loan (NPL) 110
Senior Management 34 Management
Five Years Performance 38 Risk Management Report 111
Horizontal and Vertical Analysis 42 Basel III Pillar 3 Market Discipline 125
Chairman’s Statement 47
President and Managing Director’s Review 53
Segment Analysis 57
Milestone 145
Managements and Executives 386
Branches at a Glance 387

Directors’ Report
World Economy 60
Bangladesh Economy 62
Banking Industry 65
Review of Operations of Bank Asia 66

Bank Asia Limited

2
 SUMMARY
SUSTAINABILITY CORPORATE
REPORT FINANCIALS
GOVERNANCE
146-193 252-385
194-243

SUMMARY SUSTAINABILITY REPORT FINANCIALS

Achievement for Sustainability Report 148 Auditor’s Report 254
Sustainable Banking Operations 149 Consolidated Balance Sheet 256
Message from the President and Manag- 151 Consolidated Profit and Loss Statement 258
ing Director Consolidated Cash Flow Statement 259
Report Parameter 152 Consolidated Statement of Changes in 260
Strategic Focus for Sustainability 153 Equity
Corporate Profile 154 Islamic Banking Unit 338
Primary Brands, Products and Services 156 Off-shore Banking Unit 340
Stakeholders’ Engagement 162 Subsidiary 1: Bank Asia Securities Limited 350
Material Aspects and Boundaries 165 Subsidiary 2: BA Exchange 364
Environmental Performance 166 Company(UK) Limited
Economic Performance 170 Subsidiary 3: BA Express USA Inc. 378
Sustainable HR Development 178
STANDARD DISCLOSURES CHECKLIST
Bank Asia Foundation 184
Corporate Governance Disclosure 196
Corporate Social Responsibility (CSR) 185
Checklist in line with SAFA
Customer Satisfaction Survey 188
Corporate Governance 221
Market Performance 190 Compliance Certificate
Stakeholders Relationship/Grievance 192 Corporate Governance 222
Redressal Compliance Checklist
Compliance Checklist in line with the 231
CORPORATE GOVERNANCE Companies Act, 1994
Report on the Activities of the Audit 198 Corporate Governance Compliance 233
Committee Checklist in line with Bangladesh Bank
Corporate Governance Report 202 Integrated Reporting Checklist 395
Bank Asia Shariah Supervisory 244 SAFA Standard Disclosure Checklist 396
Committee Proxy Form & Attendance Slip 400
Report of Bank Asia Shariah Supervisory 245
Committee
Chief Financial Officer’s Report 246

Annual Integrated Report 2017

3
 Notice of the
Nineteenth Annual
General Meeting
Notice is hereby given to all members of Bank Asia Limited (“the Company”)
that the Nineteenth Annual General Meeting of the members of the Company
will be held at 11.00 AM on Monday the 14th May, 2018 at the Officers’ Club, 26
Baily Road, Dhaka-1000, to transact the following business and to adopt
necessary resolutions:
Agenda
1. To receive, consider and adopt the Profit and Loss Account of the
Company for the year ended December 31, 2017 and the Balance Sheet
as at that date together with the Reports of the Directors and the
Auditors thereon.
2. To declare dividend out of the profits for the year ended
December 31, 2017.
3. To elect Directors in accordance with the provisions of law and the
Articles of Association of the Company.
4. To appoint Auditors of the Company for the term until the
conclusion of the next Annual General Meeting and to fix their remuneration.
5. To approve the appoinment of an Independent Director.

Md. Kamrul Hasan, FCS, CFA

Company Secretary

Dated: Dhaka
April 22, 2018

Notes
a) The Record Date of the Company is April 26, 2018. Trading of the Company’s shares in the Stock Exchanges will remain sus-
pended on the Record Date.
b) The shareholders whose names will appear in the Register of Members of the Company as at the close of business on the
Record Date will be entitled to attend and vote at the Annual General Meeting and to the dividend declared in the AGM, if any.
c) Any member of the Company entitled to attend and vote at the Annual General Meeting may appoint a proxy to attend and
vote on his/her behalf. The proxy must be a member of the Company.
d) The instrument appointing a proxy duly stamped and signed by the Member must be submitted at the Registered Office of
the Company at least 48 (forty eight) hours before the meeting. Proxy form is enclosed.
e) Election of Directors will be held in the vacant offices of Directors. Election schedule will be displayed in the notice board at
the Registered Office in due course. Election rules will be available at the Registered Office of the Company.
f) Annual Integrated Report 2017 along with Directors Report and Audited Financial Statements of the Bank for the year ended
December 31, 2017 will be available at the Bank’s website www.bankasia-bd.com

Bank Asia Limited

4
 Prelude
Bank Asia is growing rapidly in course of time and has already built up an asset base of
around Tk. 29 billion in 18 years of journey. Since inception, Bank Asia is working to be
a growth partner of the economy that is embedded in the vision statement of the Bank
“Poverty free Bangladesh”. Keeping this in mind, Bank Asia has developed its business
platform that offers level playing field for all segments of business from corporate to
grass- roots level. The Bank has adopted unique business models of financial inclusion
like EBEK and agent banking to reach every corner of the country, every individual of the
society. Our experience with this segment has given us a strong belief of exploring a very
potential sector which needs to nourish to come up as ‘future growth engine’. Every year
we select a theme that symbolizes our philosophy in business strategy. This year we denote
it through gravitational waves. We opted this theme as we are moving towards inclusive
banking where social responsibility is the center of gravity around which financial services
is being channeled through gravitational waves.

Bank Asia always gives more emphasis in information dissemination to the stakeholders.
Our persistent endeavor is to present accurate, true and fair description of the activities of
the Bank in all operational areas including futuristic approach. Disclosure on related party
transactions, financial statements along with major policies and explanatory notes were
elaborated to cater the information needs of stakeholders, researchers, regulatory bodies
and international financiers etc. As part of integrated report a summary sustainability
report has been included that exhibited Bank’s impacts on economic, environmental,
governance and social aspects.

The Report aims to give you the proper tool for doing necessary research and analysis for
your investment and other needs.

Md. Arfan Ali

President and Managing Director

Annual Integrated Report 2017

5
 Awards and
Recognition
Mr. Md. Arfan Ali, President
and Managing Director
of Bank Asia Limited
receiving award from
Hon’ble Finance Minister
Mr. Abul Maal Abdul
Muhith, MP, GOB for best
published Annual Report
by ICAB

Bank Asia Limited

6
 2017 2016
Bank Asia Limited has been awarded SAFA Best Bank Asia was awarded second prize under Integrated
Presented Annual Report Awards 2016, First Runner Reporting category from the Institute of Chartered
Up under SAARC Anniversary Awards for Corporate Accountants of Bangladesh (ICAB) for Best Presented
Governance Disclosures category Annual Reports (BPAR) in Bangladesh.
Bank Asia Limited was awarded Third prize in 17th ICAB Certificate of Merit from ICAB for Best Presented Annual
National Award for Best Presented Annual Reports for Reports 2015 in the Private Sector Banks including
its Annual Integrated Report 2016 under Corporate cooperative banks.
Governance Disclosures Bank Asia has garnered Bronze Award under Banking
Certificate of Merit (4th position) under Integrated Companies category in 3rd ICSB National Award for
Reporting category from the Institute of Chartered Corporate Governance for its Annual Integrated Report
Accountants of Bangladesh (ICAB) 2015 by Institute of Chartered Secretaries of Bangladesh
Bank Asia achieved ‘Winner-Best Sustainability Report in (ICSB).
Overseas category’ in the 13th Sustainability Reporting Bank Asia achieved Best Sustainability Report in
Awards (SRA) 2017 by NCSR, Jakarta, Indonesia for Bangladesh in the 12th Sustainability Reporting
Sustainability Report 2016 Awards (SRA) 2016 by NCSR, Jakarta, Indonesia for
Bank Asia achieved “ Relationship Award -2017” Sustainability Report 2015 of Bank Asia.
by Caixa Bank, Spain

Annual Integrated Report 2017

7
 Mission
To assist in bringing high
quality service to our

Vision
customers and to
participate in the growth
and expansion of our
national economy.
Bank Asia’s vision is to have a
To set high standards of poverty free Bangladesh in course
integrity and bring total of a generation in the new
satisfaction to our clients, millennium, reflecting the
shareholders and national dream. Our vision is to
employees. build a society where human
dignity and human rights receive
To become the most the highest consideration along
sought after Bank in the with reduction of poverty.
country, rendering tech-
nology driven innovative
services by our dedicated
team of professionals.

Bank Asia Limited

8
 Core
Values
Place customer interest and satisfaction
as first priority and provide customized
banking products and services.
Value addition to the stakeholders
through attaining excellence in banking
operation.
Maintain high ethical standard and
transparency in dealings.
Be a compliant institution through
adhering to all regulatory requirements.
Contribute significantly for the
betterment of society.
Ensure higher degree of motivation and
dignified working environment for our
human capital and respect optimal
work-life balance.
Committed to protect the environment
and go green.

Annual Integrated Report 2017

9
 Bank Asia
at a Glance Credit Rating
A Dream reward and performance appraisal system Credit Rating Agency of Bangladesh
Comes True encourage employees to give their best to Limited (CRAB) awarded Bank Asia Limited
Bank Asia started its journey on November serve the Bank and its stakeholders. ‘AA2’ in the Long Term and ‘ST-2’ rating in
27, 1999 with a view to providing the best the Short Term based on the financials of
quality technology driven services in Giving Back to the under 2016 will remain valid upto June 30, 2018.
banking sector. Since inception it has been Privileged & Concern to Ecology
able to cover major parts of the country Bank Asia always tries to make a better Accolades & Recognition
by extending and expanding its network society by working and donating in Bank Asia was awarded several times by
by opening of branches, agent banking different sectors such as education, the national and international reputed
outlets etc. The Bank started its Islamic health, disaster management, sports and organizations. Bank Asia has been
banking operation in 2008. It established some other sectors including the free eye awarded 1st Runner up position in the
the 1st subsidiary company ‘Bank Asia camp and ophthalmological operation SAFA Best Presented Awards 2016 under
Securities Limited’ on March 16, 2011, then facility. The Bank is also providing services SAARC Anniversary Award for Corporate
‘BA Exchange Company (UK) Limited’ in to senior citizen, widow, and disable Governance category. The Bank also
London, United Kingdom on May, 2011 beneficiaries through the government’s achieved Third prize for Best Presented
and ‘BA Express USA Inc.’ in Jamaica, New project of Social Safety Net Program. Bank Annual Reports by ICAB for its Annual
York, USA on June 01, 2014. Asia has been recognized as one of the top Integrated Report 2016 under Corporate
At present Bank Asia has 116 Branches, 10 commercial banks for its contribution Governance Disclosures and ‘Certificate
5 Islamic Windows, 4 SME Service to green banking by Bangladesh Bank. of Merit’(4th position) under Integrated
Centers, 1 Off-shore Banking Unit and In addition, it streamlines green banking Reporting Category from the Institute of
3 Subsidiaries. With an aim to serve the initiatives in its in-house management Chartered Accountants of Bangladesh
unbanked people, Bank Asia is now and investing in environment friendly (ICAB). Besides, the Bank was also
operating EBEK (Ektee Bari Ektee Khamar) projects and participating in environment awarded the prestigious‘Bangladesh Bank
banking services in 35 districts having protecting activities. As a Bank, we play Remittance Award’ for the highest volume
252 upazillas and 1,629,286 beneficiaries. an intermediary role between economic of foreign currency drawing through
The Bank has implemented 1,497 agent development and conservation of the this Bank in 2016. For Sustainability
banking outlets in 62 districts to provide environment. Report 2016, the Bank garnered Best
banking services to geographically Sustainability Report category Overseas
dispersed rural poor segment of the in the 13th Sustainability Reporting
Eagerness for
society. Awards (SRA) by NCSR (National Centre
High-Tech Solution for Sustainability Reporting) Jakarta,
Bank Asia always welcomes the innovation
Faithful and Efficient Workforce for the operation of the banking activities
Indonesia.
Bank Asia has the right blending of
as well as reporting systems. Bank Asia has
talented youth and experienced senior
associated Islamic banking, Off-shore
workforce which is truly efficient and
banking,CMSE financing, Agent Banking,
dynamic. Mr. Md. Arfan Ali who has more
EBEK, Remittance channeling & many
than 26 (twenty six) years’of multifarious
more specialized services with its core
experience in banking profession leads
banking activities. To excel in this new era
the team from the forefront as President
of technological triumph, Bank Asia has
and Managing Director. At the end of 2017,
successfully introduced Utility bill payment
the bank has 2,087 employees including
and Fees collection through Online,
370 executives and 1,717 officers to
cutting edge ICT, state of the art network
serve its clients across the country. Bank
solution, 24/7 ATM service & many other
Asia provides a work friendly elegant
e-products.
environment to its employees. Its unique

Bank Asia Limited

10
Business
Ethics Accounting
Bank Asia has the highest regard for
truth, completeness and accuracy in the
recording of business transactions in full
compliance with applicable Bangladesh
laws & regulation, financial reporting
standards, good accounting practices as
well as maintaining valid authorization
Business Principle Protection of and ensuring complete documenta-
Bank Asia goes beyond minimum legal tion. The annual accounts and interim
Personal Data accounts shall be in accordance with the
requirements and reflects the Bank’s Bank Asia’s processing of personal data
long term commitment to building a law, BFRS and good accounting
shall be subject to care and awareness,
business that is successful, honest and practices.
which is required according to laws and
responsible. regulation and relevant for information
that might be sensitive, regardless of the Competition
Human Worth data refer to customers, employees or Bank Asia is committed to staying
Bank Asia supports the international others. over and above the prevailing market
human rights as outlined by the UN dec- competition through constant
Intellectual Property innovation of technology based products
laration and convention. No one in the Intellectual property such as know-how,
Bank shall in any way cause or contrib- and efficiency enhancement; being
methodology, concepts and ideas are
ute to the violation or circumvention of responsive to the requirements of our
important to Bank Asia’s successes in the
human rights. customers and partners.
market. Unless otherwise specified by
law or orders from other public authori-
ties, no employee shall make corporate
Human Capital secret or other information available to Corruption and Bribery
Bank Asia is devoted to human capital unauthorized persons. Bank Asia is firmly opposed to all forms
initiative connecting with milestone of corruption. Bribery is fundamentally
training, performance coaching & inconsistent with the Bank’s values; any
development, key talent management, direct and indirect promise of payment
Nature and the to gain any perceived personal advan-
balancing of work/ life choice and human
capital reviews. Environment tage is totally unacceptable.
Bank Asia is very much aware regarding
environmental protection, by minimizing
Health, Safety and environmental damages and by develop- Money Laundering
ing, promoting and utilizing environment Bank Asia is firmly opposed to all forms
Working Environment friendly technology. of money laundering and shall take steps
Bank Asia is committed to establish ef-
to prevent its financial transactions from
fective arrangement to identify and elim-
being used by others to launder money.
inate or control all work related hazards Information that
and risks and promote health at work
and continuous improvement of health, may affect the Share Price Political Activity
safety and working environment. As a publicly listed company, Bank Asia
Bank Asia does not give support to po-
is subject to strict rules concerning the
litical parties, either in the form of direct
handling the non-public information
financial support or paid working time.
Confidentiality that may affect the market price of Bank
Employees may exercise their right to
Clear, honest and open communication Asia’s shares or other financial instru-
take part in politics as long as there is no
is maintained in Bank Asia to ensure full ments issued by the Bank.
conflict of interest situation with
accountability but subject to business Bank Asia.
confidentiality. The use of company
confidential information before it is
made public for personal gain is strictly
prohibited and may constitute a criminal
offense.

Annual Integrated Report 2017

11
 Employees must be open and loyal to the Bank and Bank’s interest.

Employees must keep confidential all Bank’s and other matters that could provide other third parties unauthorized access
to confidential information.

Employees must observe the Bank’s security requirements concerning access to electronic resources and documents.

All information and communication with the media, the public and financial markets shall be reliable and correct,
maintain high professional and ethical standards and in accordance with established guidelines and regulations.

Customers shall be met with insight, respect, and understanding. Employees must always try to fulfill the needs of the
customer in the best possible manner, within the guidelines for corporate ethics that apply to business.

Under no circumstances, employees shall or be a part of any activity that prohibits open and fair competition
of Bank Asia in breach of relevant business laws.

Employees shall never offer or accept illegal or inappropriate gifts or other remuneration in order to achieve business
or personal advantages.

Employee’s engagement in external duties must not affect his/her working relationship with Bank Asia or come into conflict
with Bank Asia’s business interest.

Should an employee become aware of an infringement of Bank Asia’s rules and guidelines, he/she should blow whistle
raising the issue to the line management or to People Management Division (PMD).

Bank Asia Limited

12
 Sustainable Growth
Synergies between new knowledge and human capital for sustainable economic growth

Capital Stewardship
Preservation and enlargement of multiple forms of capital; “like intellectual,
natural, financial, organizational, social; all of which contribute to long term value creation.

Accelerating Financial Inclusion

Accelerate progress towards financial inclusion with technology like ATM, mobile phone,
smart card based banking services and renewable energy generation projects especially in rural areas.

Differentiating Value Added Services

Strong focus on extremely cost-efficient and green services through internet banking, electronic fund transfer,
automated cheques clearing, e-bank statement, SMS alert etc.

Going Green
Quantification of in-house facilities and energy consumption to promote paperless office and enhance energy efficiency.
Greater emphasis on green banking projects.

Leader in Business
Create new dimension in the syndication and structured financing. Grow with export.
Well diversified portfolio.

Annual Integrated Report 2017

13
 Dupont
Analysis-5
Factors Model
DuPont analysis is an approach to decomposing return on equity for better understanding about which factor contributed to
the ROE most and which factor caused the ROE to move. For broader analysis, we used 5 factors model that covers net profit
margin, total asset turnover and financial leverage. Net profit margin is further broken down to operating profit margin, effect of
non-operating items and tax effects.

DuPont 2017 ROE

First Level Net Profit Margin Total Asset Financial

Breakdown Turnover Leverage

Second Level Operating Effect of Tax

Breakdown Profit Margin Non-Operating Items Effect

Particulars 2017 2016 2015

ROE 10.21% 8.13% 14.36%
Net Profit Margin 8.98% 7.28% 11.97%
Total Asset Turnover 0.0841 0.0890 0.1056
Financial Leverage 13.5234 12.5610 11.3570
Operating Profit Margin 29.32% 27.87% 27.94%
Effect of Non-operating Items 0.6067 0.5552 0.6867
Tax Effect 0.5046 0.4703 0.6241

The higher the value of all components of Effects on non-operating items include Efficiency of utilization of assets as
DuPont analysis, the higher the positive loan loss and other provision which implied by average total assets turnover
impact on return on equity. Net profit increased to 0.6067 from 0.5552 for the was a little bit lower than previous year.
margin consists of three important decrease of Provision by 0.14% which Bank Asia’s financial leverage increased
components namely operating profit resulted from lower classified loan. Tax to 13.5234 from last year’s 12.5610
margin, effects on non-operating items effect increased to 0.5046 from 0.4703. mainly for the higher growth in deposit
and tax effects as mentioned in second The combined effects of these three which helped to keep return on equity
level break down. Operating Profit Margin components resulted in uplift of net higher although it increases default risk
of 2017 ascended to 29.32% compared to profit margin to 8.98% in 2017 compared as well.
that of 27.87% in 2016 for higher growth to 7.28% of last year.
of net interest income and non-funded
income.

Bank Asia Limited

14
 Corporate
Structure Conventional
Offshore
Banking

Banking

Main
Bank Asia
Securities Ltd. Operation

Islamic
Banking
BA Express
USA Inc. Subsidiary
Companies
BANK
BANK
ASIA
ASIA

BA Exchange
Company (UK) Ltd.
Branchless
Banking

Remote
Banking
Agent (EBEK)
Banking

Million Taka

2017 2017
(Consolidated) (Solo)
Income Statement Matrix
Operating Profit 6,933 6,688
Profit Before Tax 4,197 4,058
Profit After Tax 2,112 2,048
Balance Sheet Matrix
Total Shareholders’ Equity 20,934 21,054
Deposits 207,284 207,041
Loans and Advances 200,328 197,504
Investments 28,145 27,546
Fixed Assets 5,344 5,330
Total Assets 290,946 288,997
Capital Measure
Capital to Risk Weighted Asset Ratio Basel-III 14.75% 14.89%
Share Information Matrix
Earnings Per Share (Taka) 2.14 2.07
Net Asset Value Per Share (Taka) 21.21 21.33
Credit Quality Ratios
Classified Loans 4.31% 4.38%
Profitability Ratio
Return on Equity 10.61% 10.21%
Return on Assets 0.77% 0.76%

Annual Integrated Report 2017

15
Corporate
Information
Letter of intent received .............................................. 24/02/1999
First meeting of promoters.......................................... 15/04/1999
Certificate of incorporation received.......................... 28/09/1999
Certificate of commencement of business................. 28/09/1999
First meeting of board of directors held..................... 01/10/1999
Banking license received............................................. 06/10/1999
First branch license received....................................... 31/10/1999
Inauguration of Bank................................................... 27/11/1999
Date of publication of prospectus............................... 29/06/2003
Date of IPO subscription.............................................. 23/09/2003, 24/09/2003
Date of first Share trading in bourse............................ 08/01/2004
Date of agreement with CDBL..................................... 20/12/2005
Date of first scripless trading...................................... 30/01/2006
Number of promoters.................................................. 22
Number of directors..................................................... 10
Number of branches.................................................... 116
Number of SME centers............................................... 4
Number of Islamic windows........................................ 5

Auditors ACNABIN
Chartered Accountants
BDBL Bhaban (Level-13)
12, Karwan Bazar
Dhaka-1215

Tax Advisors S.F Ahmed & Co.(SFACO)

Chartered Accountant and tax &
Management Consultants
House#51(3rd floor)
Road # 9, Block # F
Banani, Dhaka-1213

Legal Retainer/ Advisors M. Sakhawat Hossain

Road No. 8, House No. B-107
(Ground Floor),
New DOHS, Mohakhali
Dhaka-1206

Registered Office Rangs Tower

68 Purana Paltan
Dhaka-1000
Bangladesh

Bank Asia Limited

16
Organogram
Corporate

Annual Integrated Report 2017

17
 Board of
Directors

PS: Some of our hon’ble Directors are not seen in the picture, their names and profile can be seen in the Director’s Profile section
Bank Asia Limited
18
 Standing from left Sitting from left

Md. Arfan Ali

President and
Managing Director
M Irfan Syed
Director
Mohd. Safwan Choudhury
Vice Chairman
Md. Nazrul Huda
Director
A Rouf Chowdhury
Chairman
Mashiur Rahman
Director
Romana Rouf Chowdhury
Director

M Shahjahan Bhuiyan
Director

Major General Mohammad

Matiur Rahman (retd.)
Director

Annual Integrated Report 2017

19
 DIRECTORS’
PROFILE

A Rouf Mohd. Safwan

Chowdhury Choudhury
Chairman Vice Chairman

Mr. Mohd. Safwan Choudhury is one of the Sponsor

Mr. Abdur Rouf Chowdhury is a graduate in Business
Shareholders of Bank Asia Ltd. Mr. Choudhury has
Management from the Massachusetts Institute of
done his Masters from the University of Dhaka. He
Technology, USA. He has a wide range of experience has an impressive professional experience and has
in several industries including Automobile, Telecom, business interest in tea manufacturing, textile and
Pharmaceuticals and Petroleum. He was the Resident cold storage. His flagship company M. Ahmed Tea
Manager of two American Pharmaceutical companies in & Lands Co. Ltd. is a 4th generation tea producing
Bangladesh. Being in the senior management position company doing business since the British India.
in Jamuna Oil Company he contributed for 15 years He served as the Chairman of Bangladesh Tea
in the market development of Petroleum products in Association which represents 126 tea plantations
Bangladesh. Both Rangs and Sea Resources Groups belonging to both Bangladeshi and foreign
comprised of 32 companies were formed under his companies. Mr. Choudhury is also involved in social
dynamic leadership. The huge success of 35 companies development. He is the President of FIVDB, an NGO
providing primary education to the underprivileged
of the two groups during a short span of time is an
children. He is also the former President of Sylhet
ample proof of his dynamic leadership and progressive
Chamber of Commerce & Industry.
mind. Currently he is the Chairman of Bank Asia Ltd. He
also has his dynamic foothold in the print media; he is
the Director of renowned English daily The Daily Star.

Bank Asia Limited

20
 Hosneara Naheed Akhter
Sinha Sinha
Director
Director

Ms. Hosneara Sinha is one of the Ms. Naheed Akhter Sinha is one of the Sponsor
Sponsor Shareholders of Bank shareholders of Bank Asia Ltd. She obtained
Asia. She is involved with different MBA in Finance from North South University.
business houses and organizations She has been involved with different business
under Sinha group. She is the houses and organizations from her early career.
Director of Sinha Apparels Ltd. ZMS She is one of the promoters and shareholder
Fashions Ltd. Pritha Apparels Ltd. directors of Enterprise Cluster Pte Ltd., a
Sinha Auto Spinning Mills Ltd. and Singapore-based company. She is the Director
Sattar Jute Mills Ltd. of Sinha Apparels Ltd., ZMS Fashions Ltd. and
BP Wears (Pvt.) Ltd.

Annual Integrated Report 2017

21
 M Irfan Mashiur
Syed Rahman
Director and Chairman of the Risk Management Director and Chairman of the Audit
Committee Committee

Mr. M Irfan Syed received his Bachelor’s in Mr. Mashiur Rahman is one of the Independent
Commerce from Dhaka University and his Master’s in Directors of Bank Asia Ltd. He has over four decades
Business Administration from California University of working experience in nearly all areas of banking.
in USA. He also earned a Diploma in Advanced He started his career in 1966 as a Trainee in the
Accounting from the University of Maryland, USA. National Bank of Pakistan. After liberation he
Mr. Syed started his career with Banque Indosuez, worked for Sonali Bank and then joined IFIC Bank in
Dhaka in 1986 and then moved to Hong Kong in 1988 1983 and retired from the Bank in 2008 as Managing
to take up a position in international trade finance Director.
with the Bank of Credit and Commerce HK Limited.
After 5 years he returned to Banque Indosuez to
join their trade finance team in Dhaka. He left
international banking to start his own textile trading
company in 1993 and subsequently joined Beximco
Textiles Divison (BTD) in 1995 to help organize their
marketing and commercial departments. He was
instrumental in the implementation and integration
of BTD’s ERP system and was appointed the Head
of their Garments Division. Then he moved to USA
in 2000. After spending almost a decade as an
accountant and business head for several non- profit
organizations in the USA, Mr.Syed returned to Dhaka
in August 2010 to look after his own business.

22
M Shahjahan Md. Nazrul
Bhuiyan Huda
Director
Director

Mr. M. Shahjahan Bhuiyan is one of the Mr. Md Nazrul Huda is one of the Independent
Independent Directors of Bank Asia Ltd. He is Directors of Bank Asia Ltd. He is a former Deputy
the former Managing Director of Prime Bank Governor of Bangladesh Bank. He served the
and United Commercial Bank Ltd (UCBL). He is Bangladesh Bank successfully for 35 years in
an M.Com in Accounting from the University of different capacities. Mr. Huda obtained Masters
Rajshahi. Starting his career from 1970 under in Economics from the University of Dhaka,
Bank Officials Training Scheme of the then State Bangladesh and University of New England,
Bank of Pakistan, Mr. Bhuiyan has to his credit Australia. He has a number of publications on
more than four decades of eventful and illustrious important issues relating to economy and banking.
banking career. He was honored as Kriti Banker
by the Bangladesh Bank for his outstanding
contribution to the banking sector of the country.

23
 Major General Mohammad Romana Rouf
Matiur Rahman (retd.) Chowdhury
Director
Director

Mr. Major General Mohammad Matiur Rahman

(retd.) is one of the directors of Bank Asia Limited. Ms. Romana Rouf Chowdhury is one of the
He represents Sinha Fashions Ltd. He has more than directors of Bank Asia Limited. Ms. Romana Rouf
36 years of experience as a military personnel. After Chowdhury is a Bachelor of Arts major in English
retirement from his services, he joined the Sinha- from Brac University. She has more than 27 years
Medlar group as an adviser in 2013. He obtained his of experience as an industrialist. She is one of the
Masters in defence studies. He also participated in successful young entrepreneurs of the country.
various trainings and seminiars at home and abroad. She holds directorship of various sister concerns
of Rangs Group and Sea Fishers Group such
as Rangs Motors Ltd., Rangs Pharmaceuticals
Limited, Sea Fishers Limited, Sea Resources Cold
Storage Ltd. etc. Currently, she holds the position
of Managing Director of Sea Fishers Limited.

24
Dilwar
H Choudhury Md. Arfan Ali
Director President and Managing Director

Mr. Dilwar H Choudhury is one of the Mr. Md. Arfan Ali is the President & Managing
Independent Directors of Bank Asia Ltd. He was Director of Bank Asia. Prior to this, he was the
a veteran banker with 35 (thirty five) years of Additional Managing Director of Bank Asia Ltd. A
banking experience including working in eight career banker, Mr. Md. Arfan Ali, is an MBA from the
different countries in Asia, Africa and Europe IBA, Dhaka University, having more than 26 (twenty
in a multicultural situation. He was the former Six) years of diverse experience in banking profession
Managing Director (in-charge) of City Bank Ltd. He to his credit. He started his career with Arab
was also a Banking consultant for KPMG Dhaka Bangladesh Bank Limited as a Probationary Officer
during 2004-2005. in 1991. Later he joined Hanil Bank in 1996 and
played key roles in setting up of its Dhaka Office. He
joined Bank Asia in 1999 as Assistant Vice President
before it started its operation and played vital role
at the preoperational stage of launching formal
operations of a newly established local bank. Mr. Md.
Arfan Ali pioneered and championed Agent Banking
operations in Bangladesh. He had worked as part
time lecturer of Institute of Business Administration
(IBA), Jahangirnagar University for 10 years. He is
also member of “Academic Advisory Board, School of
Business”, Independent University (IUB), Bangladesh
and current Advisor of Bangladesh Money Market
Dealers Association (BAMDA). He is also Chairperson
of SWIFT Member and User Group of Bangladesh.
Recently, he has been elected as the Secretary
General of Association of Bankers, Bangladesh (ABB).

25
 Bank Asia Foundation
Governing Body

Sitting M.Irfan Sayed

from left

Standing
Aminul Islam Md. Arfan AIi Mohd. Safwan Choudhury A. Rouf Chowdhury
from left Chairman

Bank Asia Limited

26
Md. Nazrul Huda Mashiur Rahman

Amanullah Chowdhury Rumee A. Hossain M. Shahjahan Bhuiyan Romo Rouf Chowdhury

Annual Integrated Report 2017

27
 Key Events 2017
January
Date Key Events 2017
01 Received the Mastercard Principal Membership License from Mastercard Bangladesh
07 Bank Asia provides Higher Studies Scholarship at Chatkhil, Ramgonj, Sonaimuri of Noakhali and Chandragonj of Laxmipur district
13 Inauguration of In-House Cricket Festival-2017
17 Bank Asia celebrates ‘Agent Banking Day’ on 3rd anniversary of Agent Banking services in Bangladesh
19 Day-long training program on ‘Prevention of Money Laundering and Combating Financing on Terrorism’
21 Business Review Meeting-2017
Handing over deeds of 723 decimal land with a 2-storied building at Malkhanagar of Sirajdikhan Upazila in Munshigonj district
22
donated to Bank Asia Foundation for proposed `Bank Asia-Ma Amiran Hospital and Medical College’
26 Bank Asia opened Agent Banking outlet for farmers as a part of financial inclusion of marginalized farmers in Dinajpur
31 Bank Asia and Pran-RFL Group join hands to reach banking service to customers

February
Date Key Events 2017
04 Bank Asia provided Higher Studies Scholarship in Dhaka and Tongi, Konabari and Hemayetpur of Gazipur district
Bank Asia and Bangladesh Bank exchange documents to facilitate fund for a long-term financing under the ‘Green Transforma-
09
tion Fund for Export oriented Textile and Textile Products and Leather Manufacturing Industries’
11 Bank Asia provided Higher Studies Scholarship in Lohagara, Bhatiary, Patherhat, Lichubagan and Dohajari in Chittagong district
13 Bank Asia celebrated Basanto Utshab at the rooftop of the Corporate Office
15 Signing a participatory agreement on “Urban Building Safety Project” funded by JICA
Bank Asia signed agreement with SME Foundation to facilitate financing to women entrepreneurs involved in manufacturing
16
and service sector business in rural areas, and cluster of electrical product in the suburb of Dhaka city
19 Bank Asia opened 114th branch in Bhola
19 Commerce Minister Mr. Tofail Ahmed, MP distributed A-Card among the farmers of Bhola district
22 Handing over A-Card to female farmer at Khulna Club
22 Signing of Audited Account Statement of BA Securities Ltd.
Bank Asia signed a tri-partite agreement with Agro-Input Retailers Network (AIRN) and NAAFCO, an agricultural input marketing
23
company to offer credit facilities to their agri beneficiaries in southern regions of Bangladesh

Launching of A-Card at Bhola District

Bank Asia Limited

28
 March
Date Key Events 2017
06 Launching the 3rd Revision/Phase of online banking service to the Government’s poverty alleviation project “Ektee Baree Ektee Khamar (EBEK)”
08 Celebrated International Women's Day - 2017 in Bank Asia
Access to Information (a2i) Programme of Prime Minister’s Office, Bangladesh Rural Electrification Board (BREB) and Bank Asia
08
Limited has shacked hands to launch electronic bill payment service of BREB through Digital Centers of the country
09 Bank Asia Provided 40th Foundation Training to its Officers
09 Bank Asia awarded air tickets to eight topped credit card users under “Swipe & Fly” campaign
11 Free medical camp organized by Bank Asia Foundation at Malkhanagor in Sirajdikhan Upazila of Munshigonj district
19 Bank Asia orients its Officers on Islamic Banking and Finance
28 Bank Asia signs MoU with German Red Cross to support people facing threats of imminent extreme natural events

Painting Competition
organized by Bank Asia for
observing Independence Day

April
Date Key Events 2017
02 Bank Asia opened 115th branch in Gulshan-2
04 Bank Asia signed MoU on safeguarding insurance facilities to agent banking and school banking customers
07 Inauguration of Bank Asia Agent Outlet set up inside the Daily Shopping outlet of PRAN Group
13 Bank Asia and BRAC signed MoU on financial literacy to students
16 Bank Asia approved audited Accounts 2016
22 Training on Prevention of Money Laundering & Combating Financing on Terrorism
26 Training on Islamic Banking and Finance
29 Future Leadership Development Program (FLDP)

Opening of Bank Asia’s Gulshan-2 branch An interactive assembly titled of “Future Leadership Development
Program (FLDP)” at ‘Town Hall Meeting’

Annual Integrated Report 2017

29
Key Events 2017

May
Date Key Events 2017
03 Bank Asia and The Daily Star signs deal on Knowledge Development
04 Bank Asia opened 116th branch in Gouripur
Handed over a cheque of Tk. 40 million to the Prime Minister for the ‘Prime Minister’s Education Support Trust’ and `Father of
15 the Nation Bangabandhu Sheikh Mujibur Rahman Memorial Trust’ by Bank Asia Chairman at Gono Bhaban
18 Bank Asia provided 41st Foundation Training to its Officers
25 Training on Agent Banking Activities and Operational Procedures
29 Bank Asia’s Agent Banking platform reached GRC grants to Hatia people before cyclone falls

Handed over a cheque to

the Hon’ble Prime Minister

July
by Bank Asia’s Chairman at
Gono Bhaban

Date Key Events 2017

03 18th Annual General Meeting (AGM) held at Dhaka Ladies Club
03 A. Rouf Chowdhury re-elected as Chairman of Bank Asia
03 Mr. Mohd Safwan Choudhury and Mr. A M Nurul Islam Anu have been re-elected as Vice Chairmen of Bank Asia
08 Mr. Fazle Kabir, Governor of Bangladesh Bank handed over sanction of SME Entrepreneur Loan of Bank Asia to a client at DC Office Kishoregonj
09 Provided 42nd Foundation Training to its Officers
22 Half-yearly Business Review Meeting-2017
UNDP, Bank Asia innovate together for social safety net payments under the umbrella of the “Innovation Hub” - an alternative
23
partnership model for Private Sector engagement launched in 2017 by UNDP and the United Nations Volunteer (UNV) Programme
29 Training on Agent Banking activities and Operational Procedures

UNDP and Bank Asia joined hands together for social safety net payments under “Innovation Hub” - an
alternative partnership model for Private Sector engagement launched in 2017
Bank Asia Limited
30
 August
Date Key Events 2017
Bank Asia & IFC signed agreement where IFC has provided $40.00 million Working Capital Solutions (WCS) Facility under Global
02
Trade Finance Program (GTFP)
05 Half-yearly Business Review Meeting-2017 held at Bank Asia Bhaban, Chittagong
06 Bank Asia and Western Union joins hands to reach International Remittance through Agent Banking Digital platform to grassroot people
08 Bank Asia handed over certificates to its Officers of 42nd Foundation Training
17 Meeting with Bashundhara Group for rising of fund by Bank Asia as Lead Arranger to set up the Petrochemical Complex Plant in Chittagong
20 Bank Asia Provided 43rd Foundation Training to Officers
21 Prevention of Money Laundering and Combating Financing on Terrorism as a lead Bank for officials of all commercial banks operating in Munshigonj

Bank Asia and Western Union joined hands to sent foreign Remittance to
grassroot people through Agent Banking Digital platform

September
Date Key Events 2017
To improve professional efficiency, Chairman of Bank Asia handed over certificates among the participants
21
of 43rd Foundation Training Course
23 Bank Asia’s Agent Banking launching Customer Acquisition campaign named ‘Grow & Gain’
24 Organized a seminar on “Reporting of Foreign Direct Investment & inauguration of FDI Help Desk”
25 Provided 44th Foundation Training to its Officers

Provided 43rd Foundation

Training to the officers of
Bank Asia

Annual Integrated Report 2017

31
 October
Date Key Events 2017
Oct-7 Inauguration of district level School Banking Conference-2017 led by Bank Asia held in Munshigonj
Oct-10 Handed over a cheque of Tk. 10.00 million to National Heart Foundation for setting up a post CCU in the hospital’s Sylhet Unit
Oct-18 Bank Asia’s Vice Chairman A M Nurul Islam Anu passed away
Access to Information (a2i) entered into an MOU with Mastercard and Bank Asia to strengthen Digital Financial Services to rural
Oct-30
unbanked people of Bangladesh and make digital payment services accessible all over the country through UDCs

November
Date Key Events 2017
Handed over a cheque of Tk. 6.00 million of Bank Asia to an women entrepreneur of Bank Asia Barisal Branch at a ceremony
Nov-1
of "Bankers-SME Entrepreneurs Congregation and Open Loan Distribution Program"
Nov-5 Training on Prevention of Money Laundering and Combating Financing on Terrorism
Nov-7 Seminar on Sustainable Energy Finance jointly organized by Bank Asia and International Finance Corporation ( IFC)- World Bank
Signing agreement between Bank Asia and Bluenumber, a US-based organization on financial inclusion of Ready-made
Nov-26
Garment Workers and farmers in Bangladesh
Bank Asia signed MOU with CCRM Manager Pte Ltd., Singapore to utilize the Fin Tech platform of CCRM Manager, a global trade
Nov-26
Fin tech company for facilitating trade finance & working capital assets
Signing an MoU between Bank Asia and UNDP-funded SWAPNO project to help female beneficiaries under the financial
Nov-28
inclusion and make a tangible change in their life

Bank Asia’s 18th anniversary celebration Signing agreement between Bank Asia and Bluenumber on financial inclusion
of Ready-made Garment Workers and farmers in Bangladesh

December
Date Key Events 2017
Bank Asia organized a day long Blood Donation Program in a function held at the Bank Asia Corporate Office, Dhaka for
Dec-1
celebrating 18th Anniversary of the Bank
Dec - 11 Inauguration of Agent Outlet of Bank Asia operated by Bangladesh SME Corporation Ltd.
Agreement on implementation of premium collection service for Pragati Life Insurance through agent outlets of Bank Asia
Dec-12
across the country

Bank Asia Limited

32
 Financials sign-off ceremony

UFS-Bank Asia Mutual Fund of Tk. 1,000 Million

BSEC (Bangladesh Securities and Exchange Commission) has approved Bank Asia’s 1st Mutual Fund jointly with UFS
(Universal Financial Solutions Limited) on December 28, 2017. This is an Open-End Mutual Fund and size of the fund will
be Tk.1,000 million. Bank Asia, first ever in its kind, has already invested Tk.100 million in this Mutual Fund as sponsor of
the fund where UFS shall act as Asset Management Company and ICB (Investment Corporation of Bangladesh) perform as
Trustee & Custodian of the Fund.
We are confident that introduction of this fund will definitely enhance the bank’s brand image to different segments of
stakeholders as well as pave the way to a different dimension in income stream.

Signing Ceremony of Trust Deed for UFS-Bank Asia Unit Fund

Annual Integrated Report 2017

33
 Senior
Management
Team

Sitting Mohammad Borhanuddin Md. Sazzad Hossain

from left DMD & COO DMD

Standing Mohammad Ataur Rahman Mohammad Ibrahim Khalil, FCA

from left Member Secretary CFO
34
Md. Zahirul Alam Md. Arfan Ali
DMD President & Managing Director

Arequl Arefeen Md. A.K.M. Mizanur Rahman

Head of Treasury Head of Islamic Banking (CC)
35
 Senior
Management

Sitting Md. Sazzad Hossain Shafiuzzaman Sarder Akhter Hamed

Md. Arfan Ali
President &
from left DMD Head of C&LL Head of CMSE Managing Director

Standing Arequl Arefeen Md. Zia Arfin Md. Ariful Islam Choudhury
from left Head of Treasury Head of ID Head of Retail

Bank Asia Limited

36
 Md. Zahirul Alam Mohammad Borhanuddin Md. Abdul Qaium Khan Mohammad Ibrahim Khalil, FCA
DMD DMD & COO Head of ICT CFO

Md. Kamrul Hasan, FCS, CFA K S Nazmul Hasan Md. A K M Mizanur Rahman Md. Aminul Islam Mintu
Company Secretary Head of PMD Head of Islamic Banking (CC) Head of ICCD(CC)

Annual Integrated Report 2017

37
 Five Years
Performance
Million Taka unless otherwise specified

Particulars 2017 2016 2015 2014 2013

BALANCE SHEET MATRIX
Authorized Capital 15,000.00 15,000.00 15,000.00 15,000.00 15,000.00
Paid up Capital 9,870.11 8,812.60 8,392.95 7,629.96 6,936.32
Reserve Fund & Surplus 11,184.38 10,225.88 10,586.38 9,234.47 7,681.38
Total Shareholders’ Equity 21,054.49 19,038.48 18,979.33 16,864.42 14,617.70
Deposits 207,041.47 191,272.58 169,827.34 140,869.29 133,489.37
Loans and Advances 197,504.14 163,609.78 136,396.34 116,808.85 104,911.26
Investments 27,545.82 39,365.21 46,942.77 38,683.41 33,933.36
Fixed Assets 5,329.74 5,249.72 5,075.51 5,213.61 5,288.35
Total Assets 288,996.64 253,195.70 224,347.31 182,730.94 163,777.74
Total Off Balance Sheet Items 136,156.44 110,762.05 96,817.06 71,527.15 67,164.26
Interest Earning Assets 256,765.52 223,223.17 196,955.81 156,535.38 150,629.28
Non-Interest Earning Assets 32,231.12 29,972.53 27,391.50 26,195.56 13,148.46
INCOME STATEMENT MATRIX
Interest income 16,411.57 14,569.39 13,941.18 13,914.31 14,319.42
Interest Expenses 10,841.56 10,600.94 11,170.32 10,699.77 11,139.14
Investment income 2,535.39 3,548.30 4,827.41 4,029.12 3,053.80
Non-Interest income 3,861.98 3,123.14 2,728.65 2,442.54 2,299.08
Non-Interest Expenses 5,279.83 4,719.26 4,321.26 3,907.37 3,117.39
Total income 22,808.95 21,240.83 21,497.24 20,385.97 19,672.29
Total Expenditure 16,121.39 15,320.20 15,491.57 14,607.14 14,256.53
Operating Profit 6,687.56 5,920.63 6,005.66 5,778.83 5,415.76
Profit Before Tax 4,057.53 3,286.91 4,123.92 4,216.96 3,520.59
Net Profit After Tax 2,047.53 1,545.91 2,573.92 2,218.69 1,459.82
CAPITAL MEASURES
Risk Weighted Assets 221,114.65 199,490.69 183,247.39 157,574.62 140,976.92
Core Capital (Tier-I) 18,852.66 16,735.57 16,400.10 14,173.67 11,904.15
Supplementary Capital (Tier-II) 14,061.29 8,039.04 6,436.73 3,669.56 3,670.70
Total Capital 32,913.96 24,774.61 22,836.83 17,843.22 15,574.85
Capital Surplus/(Deficit) 10,802.49 4,825.54 4,512.10 2,085.76 1,477.16
Tier I Capital Ratio 8.53% 8.39% 8.95% 8.99% 8.44%
Tier II Capital Ratio 6.36% 4.03% 3.51% 2.33% 2.61%
Total Capital Adequacy Ratio Basel-II - - 11.32% 11.05%
Capital to Risk Weighted Asset Ratio Basel-lII 14.89% 12.42% 12.46% - -
CREDIT QUALITY
Classified Loans 8,642.30 8,847.34 5,808.87 6,200.55 5,878.79
Provision for Unclassified Loans 4,101.19 2,929.43 3,085.01 1,155.79 1,038.20
Provision for Classified Loans 3,740.00 4,494.29 2,911.65 3,981.26 3,074.43
Provision for Contingent Liabilities 1,331 1,107.62 968.17 715.27 671.64
Percentage of NPLs to total Loans and Advances 4.38% 5.41% 4.26% 5.31% 5.60%
FOREIGN EXCHANGE BUSINESS
Import 181,468.00 148,724.27 129,930.43 110,192.54 110,738.08
Export 118,172.00 103,139.15 89,275.32 77,646.91 71,968.83
Remittance (Inward) 51,778.00 41,665.14 42,996.80 41,732.50 34,334.40

Bank Asia Limited

38
 Million Taka unless otherwise specified

Particulars 2017 2016 2015 2014 2013

OPERATING PROFIT RATIOS
Credit Deposit Ratio 81.88% 76.15% 71.50% 77.87% 75.85%
Cost of Deposit 5.08% 5.66% 6.87% 7.53% 8.82%
Cost of Deposit & Borrowing 5.23% 5.71% 7.19% 7.64% 8.82%
Administrative Cost 2.50% 2.51% 2.85% 2.93% 2.66%
Yield on Loans and Advances 9.03% 9.86% 10.97% 12.77% 14.22%
Spread 3.95% 4.20% 4.10% 5.24% 5.41%
Return on Assets 0.76% 0.65% 1.26% 1.28% 0.96%
Return on Equity 10.21% 8.13% 14.36% 14.09% 10.55%
Current Ratio 1.05 1.04 1.07 1.06 1.11
Debt Equity Ratio 12.73 12.30 10.82 9.84 10.20
PERFORMANCE RATIOS
Profit per Employee 3.20 3.01 3.27 3.26 3.38
Operating profit as % of Working Fund 2.47% 2.48% 2.95% 3.34% 3.56%
Net Interest income as % of Working Fund 2.89% 2.88% 3.16% 3.85% 3.98%
Burden Coverage 73.15% 66.18% 63.13% 62.51% 73.75%
Burden Ratio 0.43% 0.40% 0.21% 0.52% 0.42%
Expense Coverage 78.04% 79.59% 89.96% 77.15% 79.44%
Ratio of Fees income 26.07% 23.26% 20.88% 19.39% 21.11%
Salary Exp. to total Overhead Exp. 47.99% 49.84% 50.28% 46.98% 46.90%
Salary Exp. to Fees income 81.21% 95.05% 100.76% 97.75% 81.16%
Cost to income/ Efficiency ratio 44.12% 44.35% 41.84% 40.34% 36.53%
DIVIDEND & RIGHTS ISSUE
Cash 15% 5%
Stock 12.50% 12% 5% 10% 10%
Total Dividend 12.50%(Proposed) 12% 20% 15% 10%
SHARES INFORMATION MATRIX
No. of Shares Outstanding(Million) 987.01 881.26 839.30 763.00 693.63
Earnings Per Share (Taka) 2.07 1.57 2.92 2.64 1.91
Number of Shareholders 10,681 10,774 12,892 16,211 18,179
Market Value Per Share (Taka) 23.10 17.90 16.50 16.70 23.00
Price Earnings Ratio 11.14 11.40 5.65 5.74 12.04
Net Asset Value Per Share (Taka) 21.33 19.29 21.54 22.10 21.07
Dividend Coverage ratio 1.66 1.46 1.53 1.94 2.10
OTHER INFORMATION
Number of Branches 116 105 98 91 86
Number of SME Service Centers 4 6 6 6 6
Number of Islamic Windows 5 5 5 5 5
Number of Employees 2,087 1,970 1,839 1,773 1,600
Number of Foreign Correspondents 727 751 663 612 761

Annual Integrated Report 2017

39
40
2013 0.96% 2013 440 2013 163,778

Total
2014 1.28% 2014 536 2014 182,731

Assets

Million USD
Inward
Million Taka
2015 1.26% 552 2015 224,347

Return on
2015

Remittance

Assets (ROA)
2016 0.65% 2016 2016 253,196
532
Five Years

2017 0.76% 2017 288,997

2017 654
Performance

133,489
2013
104,911
140,869
Million Taka
Deposits

2013 3.38 2013 2014

Advances

1,460 116,809
Advances

2014 3.26 2014 2,219 169,827

2015
Deposits and

Million Taka

Million Taka
136,396

After Tax
2015 3.27 2015 2,574

Profit per
Net Profit

Employee
2016 191,273
2016 3.01 2016 1,546 163,610
2017 3.20 2017 2,048 207,041
2017 197,504

1,324
2013
890
Export
Import
Export

1,378
Million USD

2014
2013 10.55% 2013 14,618 1,009
Import and

1,607
Total

2014 14.09% 2014 16,864 2015

Equity

1,135
Million Taka

2015 14.36% 2015 18,979 1,824

Return on
2016
1,286
2016 8.13% 2016 19,038

Equity (ROE)
Shareholders'

2,156
2017 10.21% 2017 21,054 2017
1,457

Bank Asia Limited

 2,299
2013 3,117

Million Taka
2,443
2014 3,907
2013 21.07 2013 15,575

Taka
Non Interest
2,729

Total

Share
2014 22.10 2014 17,843

Income & Non

2015 4,321

Capital

NAV per
Million Taka

Interest Expense
2015 21.54 3,123 2015 22,837
Five Years

Non-Interest Income
Non Interest Expense
2016 4,719

Annual Integrated Report 2017

2016 19.29 2016 24,775
3,862
Performance

2017 21.33 2017 2017 32,914

5,280

2013 1,600
2013 11.05% 2013 86
2014 1,773
2014 11.32% 2014 91
2015 1,839
Number of
Employees

Branches
2015 12.46% 2015 98

Number of
2016 1,970
2016 2016 105

Ratio (CRAR)
12.42%

Capital to Risk
2017 2,087

Weighted Asset
2017 14.89% 2017 116

2013 5.60% 2013 1.91 2013 761

Taka

2014 5.31% 2014 2.64 2014 612

Foreign

Earnings

2015 4.26% 2015 2.92 2015 663

per Share
Number of

Loan Ratio
2016 5.41% 2016 1.57 2016 751
2017 4.38% 2017 2.07
Correspondents

2017

Non-Performing
727

41
 Horizontal
Analysis For the last five years
Profit and Loss Statement

2017 2016 2015 2014 2013

OPERATING INCOME
Interest income 114.61% 101.75% 96.92% 97.17% 100.00%
Interest paid on deposits and borrowings, etc 97.33% 95.17% 100.28% 96.06% 100.00%
Net interest income 175.14% 124.78% 85.13% 101.08% 100.00%
Investment income 83.02% 116.19% 160.16% 131.94% 100.00%
Commission, exchange and brokerage 173.19% 137.39% 119.70% 104.25% 100.00%
Other operating income 149.11% 130.24% 115.03% 113.46% 100.00%

Total operating income 140.25% 124.69% 121.02% 113.51% 100.00%

Salaries and allowances 173.91% 161.26% 148.79% 125.70% 100.00%

Rent, taxes, insurance, electricity, etc 165.63% 144.11% 138.86% 116.12% 100.00%
Legal expenses 277.83% 181.56% 108.72% 118.17% 100.00%
Postage, stamp, telecommunication, etc 138.06% 125.81% 118.68% 105.23% 100.00%
Stationery, printing, advertisements, etc 139.55% 129.13% 142.75% 108.24% 100.00%
Managing Director's salary and fees 106.92% 120.69% 128.71% 108.92% 100.00%
Directors' fees 173.95% 185.58% 272.79% 161.05% 100.00%
Auditors' fees 87.35% 114.86% 83.94% 63.30% 100.00%
Depreciation and repairs of Bank's assets 121.26% 123.66% 116.31% 116.17% 100.00%
Other expenses 191.88% 154.31% 131.86% 137.39% 100.00%
Total operating expenses 169.37% 151.39% 138.62% 125.34% 100.00%
Profit before provision 123.48% 109.32% 110.89% 106.70% 100.00%
Provision for loans and advances/investments
General provision 2391.33% 1134.27% 3141.28% 239.98% 100.00%
Specific provision 81.25% 120.31% 5.24% 84.82% 100.00%
Provision for off-balance sheet items 281.02% 175.43% 318.15% 54.89% 100.00%
Provision for diminution in value of investments 0.00% 44.56% 0.00% 22.89% 100.00%
Other provisions - - - - -
Total provision 138.78% 138.97% 99.29% 82.41% 100.00%
Total profit before tax 115.25% 93.36% 117.14% 119.78% 100.00%
Provision for taxation
Current tax 96.42% 82.19% 75.17% 95.38% 100.00%
Net profit after tax 140.26% 105.90% 176.32% 151.98% 100.00%

Horizontal Analysis (Profit and Loss Statement)

Horizontal Analysis on Income Statement refers to the analysis of growth of each component of income statement items from the
base period. Here base period is considered the year 2013 giving value 100% and after that period value above 100% means positive
growth and below 100% means negative growth compared to base year. The above table shows that total operating income,
expenses and operating profit of Bank Asia are growing consistently over the periods. Net interest income (NII) exhibited higher
growth in 2017 for the growth of advance and decrease of deposit cost. Total provision is showing increasing trends over the periods
mainly for rising of NPL.

Bank Asia Limited

42
Horizontal
Analysis For the last five years
Balance Sheet

2017 2016 2015 2014 2013

PROPERTY AND ASSETS
Cash 185% 165% 128% 113% 100%
In hand (including foreign currencies) 123% 128% 104% 82% 100%
Balance with Bangladesh Bank and its agent bank
197% 172% 133% 119% 100%
(including foreign currencies)
Balance with other banks and financial institutions 2172% 974% 607% 55% 100%
In Bangladesh 2171% 808% 571% 52% 100%
Outside Bangladesh 2225% 6839% 1901% 161% 100%
Investments 81% 116% 138% 114% 100%
Government 80% 118% 143% 114% 100%
Others 91% 95% 94% 112% 100%
Loans and advances/investments 188% 156% 130% 111% 100%
Loans, cash credits, overdrafts, etc/investments 180% 153% 126% 108% 100%
Bills purchased and discounted 417% 224% 245% 209% 100%
Fixed assets including premises, furniture and fixtures 101% 99% 96% 99% 100%
Other assets 129% 127% 139% 117% 100%
Total assets 176% 155% 137% 112% 100%
LIABILITIES AND CAPITAL
Liabilities
Borrowings from other banks, financial institutions and agents 1556% 968% 632% 403% 100%
Deposits and other accounts 155% 143% 127% 106% 100%
Current/Al-wadeeah current accounts and other accounts 245% 200% 173% 126% 100%
Bills payable 238% 294% 236% 108% 100%
Savings bank/Mudaraba savings bank deposits 269% 217% 165% 129% 100%
Fixed deposits/Mudaraba fixed deposits 124% 122% 113% 99% 100%
Other liabilities 172% 159% 152% 127% 100%
Total liabilities 180% 157% 138% 111% 100%
Capital/shareholders' equity
Total shareholders' equity 144% 130% 130% 115% 100%
Paid-up capital 142% 127% 121% 110% 100%
Statutory reserve 175% 155% 140% 120% 100%
Revaluation reserve 80% 83% 94% 99% 100%
General reserve 100% 100% 100% 100% 100%
Retained earnings 221% 190% 283% 196% 100%
Total liabilities and shareholders' equity 176% 155% 137% 112% 100%

Horizontal Analysis (Balance Sheet)

Horizontal Analysis on Balance Sheet refers to the analysis of growth of each component of balance sheet items from the base period.
Here base period is considered the year 2013 giving a value of 100% and after that period value above 100% means positive growth and
below 100% means negative growth compared to base year. Here, assets, liabilities and shareholders’ equity are showing consistent
growth over the last five years which symbolize sustainable balance sheet growth of the bank as a whole. Investment shows negative
growth trend as fund is shifted from investment to loans and advance.
Annual Integrated Report 2017
43
 Vertical
Analysis For the last five years
Profit and Loss Statement

2017 2016 2015 2014 2013

OPERATING INCOME
Interest income 71.95% 68.59% 64.56% 68.25% 72.79%
Interest paid on deposits and borrowings, etc 47.53% 49.91% 51.96% 52.49% 56.62%
Net interest income 24.42% 18.68% 12.59% 15.77% 16.17%
Investment income 11.12% 16.71% 22.75% 19.76% 15.52%
Commission, exchange and brokerage 13.68% 11.65% 10.03% 9.21% 9.16%
Other operating income 3.25% 3.05% 2.66% 2.77% 2.53%
Total operating income 52.47% 50.09% 48.04% 47.51% 43.38%
Salaries and allowances 11.05% 11.00% 10.03% 8.93% 7.37%
Rent, taxes, insurance, electricity, etc 2.69% 2.51% 2.39% 2.11% 1.88%
Legal expenses 0.11% 0.08% 0.04% 0.05% 0.05%
Postage, stamp, telecommunication, etc 0.39% 0.38% 0.36% 0.33% 0.33%
Stationery, printing, advertisements, etc 0.43% 0.42% 0.46% 0.37% 0.35%
Managing Director's salary and fees 0.06% 0.07% 0.08% 0.07% 0.07%
Directors' fees 0.01% 0.02% 0.02% 0.01% 0.01%
Auditors' fees 0.00% 0.01% 0.00% 0.00% 0.01%
Depreciation and repairs of Bank's assets 2.02% 2.21% 2.05% 2.16% 1.93%
Other expenses 6.39% 5.52% 4.66% 5.12% 3.86%
Total operating expenses 23.15% 22.22% 20.10% 19.17% 15.85%
Profit before provision 29.32% 27.87% 27.94% 28.35% 27.53%
Provision for loans and advances/investments
General provision 5.14% 2.62% 7.16% 0.58% 0.25%
Specific provision 5.41% 8.61% 0.37% 6.32% 7.73%
Provision for off-balance sheet items 0.98% 0.66% 1.18% 0.21% 0.40%
Provision for diminution in value of investments 0.00% 0.52% 0.00% 0.28% 1.25%
Other provisions 0.00% 0.00% 0.05% 0.27% 0.00%
Total provision 11.53% 12.40% 8.75% 7.66% 9.63%
Total profit before tax 17.79% 15.47% 19.18% 20.69% 17.90%
Provision for taxation
Current tax 8.63% 7.90% 7.14% 9.55% 10.38%
Deferred tax 0.18% 0.30% 0.07% 0.25% 0.10%
Net profit after tax 8.98% 7.28% 11.97% 10.88% 7.42%

Vertical Analysis (Profit and Loss Statement)

Vertical Analysis on Income Statement refers to the components of income statement items as a % of total income over the periods
which would be termed as common sizing of income statement. In income side, interest income (71.95%), income from commission,
exchange and brokerage (13.68%) and investment income (11.12%) hold major portion. Interest income was in a decreasing trend
but increased in 2017 for the growth of advance by 21% and income from commission, exchange and brokerage also increased for
the growth of non-funded business by 16.17% in 2017. Investment income was in increasing trend but decreased in last year due to
a reduction of yield on treasury bill/bond. Operating expense as a % of total income is increasing over the periods due to network
expansion and establishment of new departments in line with business model/ strategies and net profit increases significantly for
lower provision requirement.
Bank Asia Limited
44
Vertical
Analysis For the last five years
Balance Sheet

2017 2016 2015 2014 2013

PROPERTY AND ASSETS
Cash 6.20% 6.31% 5.56% 5.99% 5.93%
In hand (including foreign currencies) 0.69% 0.82% 0.75% 0.73% 0.99%
Balance with Bangladesh Bank and its agent bank (including foreign
5.52% 5.49% 4.80% 5.26% 4.94%
currencies)
Balance with other banks and financial institutions 10.24% 5.24% 3.69% 0.41% 0.83%
In Bangladesh 9.95% 4.23% 3.37% 0.37% 0.81%
Outside Bangladesh 0.29% 1.02% 0.32% 0.03% 0.02%
Money at call and on short notice 0.00% 1.92% 1.44% 0.16% 0.00%
Investments 9.53% 15.55% 20.92% 21.17% 20.72%
Government 8.45% 14.26% 19.49% 19.07% 18.63%
Others 1.08% 1.28% 1.44% 2.10% 2.09%
Loans and advances/investments 68.34% 64.62% 60.80% 63.92% 64.06%
Loans, cash credits, overdrafts, etc/investments 62.80% 61.22% 56.60% 59.53% 61.71%
Bills purchased and discounted 5.54% 3.39% 4.19% 4.39% 2.34%
Fixed assets including premises, furniture and fixtures 1.84% 2.07% 2.26% 2.85% 3.23%
Other assets 3.84% 4.28% 5.33% 5.49% 5.23%
Total assets 100% 100% 100% 100% 100%
LIABILITIES AND CAPITAL
Liabilities
Borrowings from other banks, financial institutions and agents 10.47% 7.43% 5.48% 4.29% 1.19%
Subordinated non-convertible zero coupon bonds 2.80% 1.26% 1.48% 0.25% 0.37%
Deposits and other accounts 71.64% 75.54% 75.70% 77.09% 81.51%
Current/Al-wadeeah current accounts and other accounts 14.53% 13.53% 13.20% 11.77% 10.46%
Bills payable 1.37% 1.94% 1.75% 0.99% 1.02%
Savings bank/Mudaraba savings bank deposits 11.94% 10.98% 9.44% 9.06% 7.83%
Fixed deposits/Mudaraba fixed deposits 43.80% 49.10% 51.31% 55.27% 62.20%
Other liabilities 7.80% 8.10% 8.88% 9.14% 8.01%
Total liabilities 92.71% 92.34% 91.54% 90.77% 91.07%
Capital/shareholders' equity
Total shareholders' equity 7.29% 7.66% 8.46% 9.23% 8.93%
Paid-up capital 3.42% 3.48% 3.74% 4.18% 4.24%
Statutory reserve 2.54% 2.61% 2.62% 2.76% 2.57%
Revaluation reserve 0.75% 0.88% 1.14% 1.47% 1.65%
General reserve 0.00% 0.00% 0.00% 0.00% 0.00%
Retained earnings 0.58% 0.68% 0.96% 0.82% 0.46%
Total liabilities and shareholders' equity 100.00% 100.00% 100.00% 100.00% 100.00%

Vertical Analysis (Balance Sheet)

Vertical Analysis on Balance Sheet refers to the components of balance sheet items as a % of total Assets over the periods which
would be termed as common sizing of balance sheet. In asset side, Loans and advances (68.34%) and investment (9.53%) holds
major portion. Investment decreased significantly because of reducing yield on government securities where Loan and advances
had a consistency except the year 2015 but increased in 2017 in line with the growth of overall industry by 18.50%. In liability side,
deposit holds major portion (71.64%) and shows a decreasing trend over the last five years. But in 2017 deposit decreases as overall
industry deposit growth was only 10.20%.
Annual Integrated Report 2017
45
Banking sector has witnessed a
sound operating profit in 2017
despite the downward pressure of
interest rate on loans and advances.
The Industry has seen a rise in
the deposit interest rate during
the second half of 2017. From the
perspective of investment, credit
growth registered 18.50% which is
the highest in last five years and also
surpassed BB’s target in monetary
policy. This surge is attributed to
the overall growth in economy and
it created some liquidity pressure in
the industry at the end of the year.

Bank Asia Limited

46
Chairman’s
Statement ASSALAMUALAIKUM
It is my great pleasure to welcome you all to the 19th Annual General Meeting of Bank
Asia Limited. On behalf of the Board of Directors, it is my privilege to present the Annual
Integrated Report of Bank Asia for the year 2017.
HONORABLE MEMBERS
The economy of the country has shown satisfactory performance in the fiscal 2016-17
exhibiting notable GDP growth of 7.28% which was 7.11% in 2015-2016. In the period
the per-capita income increased to USD1,610 from USD1,465. Foreign currency reserve
crossed a record USD 33.22 billion in 2017 with which around nine months import bill of
Bangladesh could be met up. Annual average inflation rate was at tolerable level of 5.7%
in 2017, though little higher than 5.51% in 2016.
Banking sector has witnessed a sound operating profit in 2017 despite the downward
pressure of interest rate on loans and advances. The Industry has seen a rise in the
deposit interest rate during the second half of 2017. From the perspective of investment,
credit growth registered 18.50% which is the highest in last five years and also surpassed
BB’s target in monetary policy. This surge is attributed to the overall growth in economy
and it created some liquidity pressure in the industry at the end of the year. Throughout
the year, the sector also faced challenges from accumulated non performing loans. In this
backdrop, your bank has moved cautiously to maintain sustainability in business and
profit. Deposit of the bank increased to Tk.207 billion, advance to Tk.198 billion, import
financing was Tk.181 billion, export financing was Tk.118 billion and inward remittance
was Tk.52 billion. The bank has surpassed the industry growths almost in every aspect of
business. In the year Bank’s deposit, advance, import, export and remittance growth were
8.24%, 20.72%, 18.21%, 13.36%, 23% against industry growth of 10.20%, 18.50%, 15.80%,
3.00%, -0.6% respectively. Country as a whole witnessed negative growth in remittance
whereas your Bank exhibited double digit growth.
RESPECTED SHAREHOLDERS
You will be happy to know that Bank Asia has achieved a sizable growth in operating
profit amounting to Tk.767 million, highest growth in last 5 years. Operating profit stood
at Tk.6.69 billion in 2017. After setting aside provision for loans and advances, tax, reserve
and others, the bank attained net profit of Tk. 2.05 billion. Higher growth in operating
profit, less requirement of provision and efficient tax management attributed to the
growth of net profit by 32%. Profitability measures like return on equity (ROE) and return
on assets (ROA) stood 10.21% and 0.76% respectively in 2017 which was 8.13% and 0.65%
in 2016. These figures indicated a successful year closing in 2017 in terms of operation.
However, non-performing loan was a burning issue for us and for the industry throughout
the year. In 2017, total non-performing loan in banking industry increased by 19.50% and
stood Tk.743 billion which was Tk.622 billion in 2016. In this challenging circumstances,
Bank Asia was able to restrain its classified loans (CL) to 4.38% against industry CL of
Human Capital around 9%. The improvement in CL position was accomplished mostly through recovery
from non-performing loan rather than adopting traditional approach of rescheduling
Development of human of classified loan. Still, the current CL and some stay order loans are posing significant
resources is not an expenditure; challenges for the Bank.
it is an investment. You get Considering the above operational performances and other financial positions, the Board
the highest return from of Directors recommended 12.50% stock dividend for the year 2017.
HR investment. Let’s make DEAR SHAREHOLDERS
maximum investment in quality We assure you that the fundamentals of your Bank are strong. Bank Asia’s total capital
reached to Tk. 32.91 billion in 2017 from Tk. 24.77 billion in 2016, having a growth of
human resources. They are the
32.85%. The strong capital base will ease the expansion of business in future. This year
leaders; they will take the Bank we have issued Tk. 5.00 billion worth subordinate bond. Additionally, credit rating
forward. of the clients has reduced the risk weighted assets of the Bank to a great extent. The
combination of all these factors helped the Bank to close the year with strong capital
base. The capital adequacy ratio of the Bank was 14.89% against regulatory requirement
of 10% in 2017. This is the highest ever capital position for Bank Asia and one of the
-A Rouf Chowdhury
highest position in banking industry. We have a plan to raise further capital amounting
to Tk. 5.00 billion through issuing another subordinated bond in 2018.

Annual Integrated Report 2017

47
 Chairman’s
Statement
HONORABLE SHAREHOLDERS You will also be glad to know that government will also open up the door
Diversification of business is essential for Bank Asia has superseded the target for augmentation of economic activities.
a sustainable balanced financial position. of Agri-credit set by Bangladesh Bank It is our pride that Bangladesh has come
To diversify the advance portfolio and to consecutively for the last three years out from the status of poor country
increase the return, the bank followed and received appreciation letter and emerged as a developing country.
the strategy of increasing the share of from Bangladesh Bank. In 2017, total We hope that Bangladesh will move to
SME and retail business in the portfolio. disbursement in this sector was Tk.3.59 middle income country soon. Financial
For the last two years the share of SME billion and outstanding was Tk.4.08 billion institutions will play a major role as a
& Retail credit increased by 5% and this having a growth of 36% over previous year. strategic partner of these developments.
helped the bank offset the impact of DEAR SHAREHOLDERS Finally, I would like to thank Bangladesh
declining interest rate. Moreover, from Corporate social responsibility is an Bank and other regulatory authorities for
the cost perspective, deposit mix has integral part of our mainstream operation. their guidance and continuous support.
been maintained with balanced weight We want to grow with our surroundings I am grateful to the shareholders for
on high cost and low cost deposit that particularly with the people who are their continuous trust, confidence and
helped the bank to reduce cost of deposit underprivileged and lack of proper cooperation.
significantly, from 5.66% to 5.08% in support. Bank Asia Foundation has started
2017, a reduction by 58 basis points. I also give my gratitude to the
its noble operation in the mean time to
Management and to the Board of Directors
RESPECTED SHAREHOLDERS strengthen CSR operation. Initially, the
for their continuous effort and sincerity
A huge number of people of Bangladesh foundation has a plan to construct a
towards achieving desired goals in line
is still living beyond the network of 250 bed hospital cum medical college at
with our mission and vision.
formal banking channel. Hence, financial Malkhanagar, Munshigonj and my family
inclusion of this segment is a must for members including me have donated 700 My best wishes to all of you.
the development of economy. It is our decimal land and a 3 storied building for
pride to mention that Bank Asia is the the proposed Hospital. You will be glad to
pioneer in introducing agent banking know that your Bank spent Tk.184 million
and EBEK operation, two renowned in 2017 for CSR activities having growth of
financial inclusion models in Bangladesh 69% over previous year. Scholarship is one A Rouf Chowdhury
to spread banking services at grass of our most focused CSR initiatives under Chairman
root level. Bank Asia is now providing which poor and meritorious students are
EBEK Banking services to 1,629,286 receiving Tk. 51,000 every year for their
beneficiaries in 252 Upazillas under 35 higher studies. So far, 1,547 students
districts. Agent Banking is growing very have been awarded the scholarship.
rapidly and its activities is not less than This year we have spent Tk. 50.00 million
a Bank. Agent outlets increased by 347 for supporting Rohingya refugees and
and stood 1,497 in 2017 which was 1,150 Tk.32.60 million for supporting to cold
in 2016. Currently 62 districts have been and flood hit people.
covered to provide this facility. Till 2017, HONORABLE SHAREHOLDERS
the bank collected Tk.2.65 billion through The year 2018 will be a challenging
311,947 accounts as well as disbursed one considering the liquidity issue,
Tk.927 million as loan through Agent rising classified loan, increase of cost
Banking. of deposit, lower yield of Treasury bill
The functional dimension of EBEK and so on. This scenario would even be
and Agent Banking is not only limited more challenging due to the upcoming
to the typical banking business rather national election expected to be held on
involved with implementing many other early 2019. Still we are not overlooking the
government projects like Social Safety opportunities waiting for us. Mega projects
net Programs, senior citizen allowances, like Padma Bridge that will directly attach
insolvent autism allowances, payments 21 southern districts of Bangladesh to
for widow or divorced women allowance, the capital city Dhaka, metro rail and
Payments of freedom fighters allowance, other giant infrastructural investment by
payment of foreign remittance etc.

Bank Asia Limited

48
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cwiPvjb gybvdv wQj 669 †KvwU UvKv| F‡Yi Rb¨ wcÖq †kqvi‡nvìvie„›`,
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hv MZ eQi †_‡K 32 kZvsk †ekx| Ab¨w`‡K, Kvh©µ‡giB GKwU Ask| Avgiv Avgv‡`i mgv‡Ri
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Annual Integrated Report 2017

49
 Our
Acknowledgement to
Ex Chairmen with Present Chairman

Mr. M Syeduzzaman Mr. Anisur Rahman Sinha Mr. A Rouf Chowdhury

(1999-2008) (2008-2010) (2010 to till now)

Ex Managing Directors

Mr. Quazi Baharul Islam Mr. Syed Anisul Huq Mr. Erfanuddin Ahmed Md. Mehmood Husain
(1999-2000) (2000-2008) (2009-2011) (2011-2016)

Bank Asia Limited

50
 We Mourn
The Bank Asia family is deeply grieved by the sad demise of
A M Nurul Islam , Vice Chairman of Bank Asia. He passed away
at United Hospital Gulshan on Wednesday (October 18, 2017)

A M Nurul Islam has started his career as a teacher of Dhaka

University in 1961. Later, he joined Pakistan Civil Service in
1963.He also held important assignments, including private
secretary to former Prime Minister Bangabandhu Sheikh
Mujibur Rahman.He also worked as an economic diplomat in
Washington DC. He was a director of National Bank Ltd and
acted as the Chairman of its audit committee.

Annual Integrated Report 2017

51
 Bank Asia Limited
52
 President and Managing
Director’s Review
The economy of Bangladesh made an Bank projection of positive growth of
impressive progress in 2017 registering GDP 16.10%. The government collected money
growth of 7.28% where major boost of growth through different saving instrument which
came from the industrial sector followed by the increased its annual non-bank borrowing.
services sector. The stable political situation In contrast, private sector credit growth
helped to build investors’ confidence which increased significantly in 2017 due to
was reflected in the private sector credit growth higher trade financing for settle of import
by 18.13% in 2017. The banking industry payment obligation. The growth in private
performed well in 2017 and witnessed a sound sector rose to record high of 19.06% in
operating profit. However, banking sector of November 2017 on a year on year basis
Bangladesh also faced many hurdles such as from 18.63% in October 2017.
deteriorating asset quality, tighter liquidity The capital market of Bangladesh
position, moderate remittance inflow, balance experienced a strong bullish trend in
of payment pressure, technology disruption 2017 as prime index of the Dhaka Stock
etc. Against this adversaries, Bank Asia showed Exchange started the year with 5,036.05
resilience and made good progress in terms points on January and ended the year with
of implementing strategy, delivering strong 6,244.52 points.
operating performance and cost efficiencies, as
well as solid returns. Apart from the above, the Majority of the banks of Bangladesh started
following events that occurred throughout the facing shortage of available liquid funds at
year also influenced our business strategies: the last quarter of 2017. One of the major
reasons behind this liquidity crunch were
In April and May 2017 flash floods in the rapid large import payments compared
north eastern Haor regions devastated to lower export and remittance flow, thus
paddy fields. This was followed by an increased private sector credit growth.
average monsoon flooding in August which
Banking sector of washed away around 600,000 hectares of As mentioned above export sector of
Bangladesh faced Aman Paddy fields. As a result, average Bangladesh experienced a meagre growth
general inflation edged up marginally to of 1.7% in 2017, the lowest in the last 15
many hurdles such as 5.70% in December 2017 from 5.51% in years. A fall of the euro against US dollar
deteriorating asset quality, December 2016. along with uncertainty surrounding
BREXIT and decline in consumption in the
tighter liquidity position, Remittance maintained a sluggish growth west were some of the major factors that
in 2017 as remittance dropped to a six year
moderate remittance low to USD 13.53 billion in 2017 which
contributed to a slowdown in export growth.
In 2017 import payment stood at USD
inflow, balance of payment was USD 13.61 billion in 2016. Though
43,491 million registering 9% growth
making up for the despairing overseas
pressure, technology job condition, Bangladesh has witnessed compared to USD 39,901 million in 2016.
disruption etc. Against an expatriation of 1 million workers in Fresh LC openings of consumer goods,
especially food items were main reason
2017 providing a better outlook for the
this adversaries, Bank economy as the remittance is the mainstay behind this growth. In addition, settlement
Asia showed resilience for the foreign exchange and reserve for of LC registered the highest growth in
Bangladesh capital machinery for textile and garments
and made good progress sector, iron and steel scraps, machinery for
The share of nonperforming loans stood
in terms of implementing at 10.7% in September 2017 compared
motor vehicles and iron & steel product.
MAJOR PRIORITIES WE FOLLOWED IN 2017
strategy, delivering strong with the ratio of 9.23% in December 2016
mainly because of lack of good governance We set loan recovery and regularization of
operating performance and and increasing number of habitual default classified and non-performing loan (NPL)
cost efficiencies, as well as borrowers. As on 30th September 2017 the as the top most priority and engaged
cumulative NPL’s of the bank reached Tk. Corporate Office employees to assist
solid returns. 803.10 billion or 10.70 % of NPL to total Special Asset Management Department
loan. This ratio has slightly decreased to (SAMD) and Branches to expedite recovery
9.30% at the end of the 2017. process. We started the recovery initiative
Public sector credit registered a negative right at the beginning of the year and
growth of 12.02% compared to Bangladesh continued and intensified the drive
throughout the year. Our strategy, effort

Annual Integrated Report 2017

53
 President and
Managing Director’s Review
and hard work paid off and we were faster approval of credit facility. While active throughout the year and arranged
able to reduce loan classification both granting loan, we adhered to bank’s good number of training and workshops
in percentage and in absolute term. We policy and standard without showing for our employees.
closed the year 2017 with CL rate of 4.38% any compromise or laxity to ensure good OPERATING PERFORMANCE
which was 5.41% in 2016. health of our asset portfolio.
During the year 2017, the bank generated
While our goal was to achieve the Along with the process improvement, we operating profit of Tk. 6,688 million with a
profit target, at the same time we were also went for process automation and growth of 13% but net profit was Tk. 2,048
concerned with risk management, adoption of technology for improvement million with a growth of 32%. That substantial
compliance and internal control to of efficiency and strengthening of risk growth in net profit was possible mainly
ensure sustainability of the profit. We took management. Comprehensive dashboard due to success in curbing non-performing
necessary actions and steps for process for MIS and monitoring, Business Metrics loan at 4.38%. Net Interest Income was also
improvement to strengthen our risk for online tracking of credit proposal, increased by Tk. 1,602 million and registered
management and compliance standard. E-sanction for online sending and 40.36% growth which was mainly driven by
The overall outcome was positive and we preservation of credit proposal, online strong growth in loans and advances and thus
made improvement in almost all core risk CIB inquiry and download, My Family App compensated in the net interest margin.
areas as rated by Bangladesh Bank. for communication, Foreign Exchange
Transaction Monitoring and Reporting One of the major success of the management
We took steps to take our corporate was to reduce cost of deposit by improving its
banking business beyond the boundaries System, central archiving system, Bio-
metric attendance for corporate office and deposit mix. In 2017, the ratio of high cost to
of conventional financing. We provided low/no cost deposit stood at 50%:50%, which
Export Credit Agency (ECA) covered branches etc. were introduced.
was 53%:47% in the previous year. Because of
finance, arranged foreign currency fund Our Agent Banking services and network, such cost reduction, the bank could offer loans
for our customers under the Long Term EBEK (Ektee Bari Ektee Khamar) Project to customers at highly competitive rates which
Financial Facility (LTFF) of Financial Sector and Social Safety Net Payment expanded also helped to make a solid business growth.
Support Project of Bangladesh Bank. We their reach and coverage. With acquisition The Bank could also improve its ROA to 0.76%
entered into agreement with Bangladesh of 343 numbers of individual agents and ROE to 10.21%.
Bank for Green Transformation Fund(GTF), in 2017, total number of Agent outlets
Green Finance under refinance scheme, reached 1494 throughout the country Improvement in asset quality was one of the
Urban Building Safety Project(JICA funded) covering 61 districts and 298 Upazillas. We key parameter in accelerating profitability. At
finance to provide low cost fund to our have formed partnership with different the end of the year 2017 the bank was able to
manufacturer customers to ensure safety national and international organizations, restrict CL at 4.38% compared to 5.41% in 2016
and compliance. government agencies, NGOs for providing mainly due to the concerted management
more value added services to the marginal effort. Moreover, the Bank was also able to
To provide special attention and support make a cash recovery of Tk. 2,540 million from
to newly opened small and rural Branches, unbanked people of the country.
classified and written off loan accounts.
we formed a specialized Department School Banking, Internet Banking, Bank
named “Central Business Processing Asia Smart App(Android based Mobile App) In 2017, 09 new branches were added to the
Department (CBPD)” at Corporate Office. and other Alternative Delivery Channels total branch network and 117 employees
This Department helped these new achieved significant growth and expansion were added to human capital. The above
branches in marketing of both loans and last year. Mobile App for Agent Banking addition impacted total operating expenditure
deposit. In addition, the Department also customers in Bangla, RMG digital Branch to increase by 11.88% in 2017, out of which
helped the branches in credit proposal with off-site ATM network, internet banking salary expenditure increased by 8%. At the end
preparation and approval process and facilities with NPSB, first ever effort in its of 2017, the Bank’s Net Asset Value per Share
provided support in other areas too. kind with 5 other Banks to facilitate real (NAV) stood at Tk. 21.33 and Earning per Share
time inter-bank Internet Banking Fund (EPS) at Tk. 2.07.
For financing CMSE (Cottage, Micro,
Small) segment, we started utilizing our Transfer(IBTF) etc were introduced to serve BUSINESS
Agent Banking Channel. All unsecured the customers online with the objective to Deposits of banking operation stood at Tk.
loan proposals channeled through Agent reduce time and cost. 207,041 million showing a growth of 8.24%
Banking were processed and approved on At Bank Asia, we have always given priority and loans and advances stood at Tk. 197,504
tab-based digitized platform. for development and nurturing of Human million with a growth of 20.72%. Import
Steps were taken to improve Credit Risk Resource. To groom our employees as business of the bank was Tk. 181,468 million,
Management system. The separation of potential leader, we continued Future registering 22.02% growth, whereas export was
Business and CRM team were ensured Leadership Development Program and Tk. 118,172 million with 14.58% growth. During
for all segments including the retail and completed 01(one) year of the program 2017 total inward remittance was
CMSE credit. The Credit Committee were in November 2017. Some 340 employees Tk. 51,778 million, showing a positive growth of
reconstituted and role of the CRO was under 21 mentors have been immensely 24.27%. In terms of budgetary achievement the
redefined. Mid-level executives at CRM benefitted from this program. Apart from bank performed well; deposit by 92%, loans
were allowed Business delegation for this, our Training Institute remained very and advances by 99%, operating profit by 95%,

Bank Asia Limited

54
President and
Managing Director’s Review
32,860 million and Tk.4,083 million respectively.
99% CSR
116%
Bank Asia has always been aware of its

197,504
105%

200,310
Corporate Social Responsibility (CSR) with an
207,041

95% 98%
92% aim to ensure the bank as a socially responsible

181,468
173,600
163,610

corporate entity contributing towards better

148,724
191,273

quality of life of the society at large without

compromising our ecological conditions.

120,419

118,172
During the year 2017, Bank Asia spent an

103,139
24%
amount of Tk. 183.83 million on CSR which
21% 22%
covers a vast area of education, health and
13% 15%
8%
other under privileged sectors for the overall

51,778
betterment of the nation.
7,026

44,533
6,688

41,665
5,920

STRENGTHENING CAPITAL BASE

Operating Deposit Advance Import Export Remittance For managing the overall risk exposure of the
Profit Bank, our primary focus has always been to
Actual 2016 Budget 2017 Actual-2017 Budget Achievement % Year to Year Growth %
strengthen our risk management policy with a
strong internal control system. We maintained
capital to total risk weighted asset (CRAR)
the management expects that the company
import by 105%, export by 98% and inward consistently above the threshold (10% of
will come to break-even within 1 year. The
remittance by 116%. RWA) of minimum capital requirement. Bank
company has been running for almost 4.5 years
SUBSIDIARIES OF BANK ASIA LIMITED Asia’s CRAR was 14.89% as on 31 December
and incurred a cumulative operating loss of
2017 against the required MCR of 10%. To
Bank Asia Securities Limited, a 99.99% owned USD 0.85 million (BDT. 69.70 million). In the year
support healthy business growth and ensure
subsidiary company of the Bank made an 2017, BA EXPRESS USA incurred an operating
compliance with the Basel III capital accord
operating profit of Tk. 255 million in 2017. loss of USD 0.124 million (BDT 9.84 million).
in line with Bangladesh Bank roadmap Bank
Bank Asia Securities also continued to retain BUSINESS UNITS Asia has already completed further issuance of
the position of DSE’s Top-20 in terms of Subordinated Bond of Tk. 5,000 million as Tier
Bank Asia’s overall operation is concentrated in
daily turnover throughout the year. Despite 2 capital in April 2017.
six major areas.
the various challenges that prevailed in the
market, BASL added 916 new clients in 2017 Conventional: Bank Asia delivers conventional NON-PERFORMING LOAN (NPL)
representing a growth of 17%. banking services through 120 branches and MANAGEMENT
SME service centers across the country. One of the core business priorities of Bank Asia
The other foreign subsidiary exchange
house company, named as BA Exchange Islamic: Banking Operation has been operated is to curb non-performing loans by maintaining
Company (UK) Limited, sent total GBP 10.60 through 5 Islamic windows. All conventional quality assets. In this regard, Bank Asia’s credit
million as remittance in 2017. The company branches also provide Islamic Banking services approval process has been framed to unveil
has been running for 5.6 years and incurred through SALAMAH desk. and assess the unforeseen inherent risk so that
a cumulative operating loss of GBP 0.21 Off Shore: One off shore banking unit in assets quality will not deteriorate in the long
million (BDT 21 million). In the year 2017, BA Chittagong. run. Additionally, early warning system has
Exchange UK generated an operating profit of been established so that precautionary action
Credit Card: In 2017, 11,309 number of new can be taken against vulnerable assets. Above
GBP 4,228 compared to GBP 939 in 2016. The
credit cards were issued compared with 7,165 all, proper monitoring and strong recovery
management is pursuing cost optimization
number of new cards in 2016 registering 58% drive from branches and corporate office help
strategies to improve health of those
growth. to maintain the quality of the assets of Bank
companies and turning them to breakeven.
However, it is worth mentioning here that the Agent Banking: Provide Agent Banking services Asia.
network is certainly profitable if we add the in 62 districts through 1,497 agent outlets. In 2017, both Corporate Office and Branches
value of those two foreign subsidiaries to the Ektee Bari Ektee Khamar: 1,629,286 worked hard hand in hand for loan recovery
parent company e.g. Foreign Exchange float for beneficiaries of 21,816 villages in 35 districts as well as for arresting new inclusion of new
import bill settlement and opening of deposit came under EBEK program. NPLs. Bank’s strategy, effort and hard work has
customers’ Accounts etc. CMSME Banking & Agri/Rural Credit paid off and Bank have been able to reduce
In 2017, our expatriate from abroad sent loan classification both in percentage and in
The Bank continued its drive towards absolute term. Bank ended the year 2017 with
USD 36.26 million remittance to Bangladesh increasing its market share in CMSME (Cottage,
through BA EXPRESS USA. To enhance further 4.38 % classified loan which amounted to Tk.
Micro, Small and Medium Enterprise) and 8,642 million.
flow of remittance BA EXPRESS USA also agricultural financing besides corporate and
established arrangement with 34 agents across retail segments. In 2017 Bank Asia’s CMSME
New York City. With this pace of remittance and agricultural loan outstanding stood at Tk.

Annual Integrated Report 2017

55
 President and
Managing Director’s Review

CREDIT RATING and non-legal measures will be pursued to country. We will cover more unions
The long and short term credit rating of the this endeavor. through Union Digital Centers (UDC),
bank remain stable in 2017. The rating of the We will focus more on improving health NGO offices, Post Offices and other
bank in 2017 for long term was AA2 and for of our asset portfolio this year. We will organizations. Special focus will be
short term was ST-2. emphasize on regular monitoring of given on the partnership with Mobile
existing loan to restrain deterioration to Telecommunication Companies.
AWARDS & ACCOLADES
overdue and SMA. We will emphasize on At the end, I would like to express my sincere
Bank Asia received several awards by strengthening relationship with existing thanks to our customers who continue to put
the national and international reputed good customers and remain vigilant and their trust in Bank Asia Limited. I also want to
organizations. Bank Asia has been awarded 1st cautions while sanctioning new loan thank my colleagues for their commitment and
Runner up position in the SAFA Best Presented to ensure quality. For monitoring and relentless efforts. I also appreciate the guidance
Awards 2016 under SAARC Anniversary Award regular visit of customers of Export and and strategic advices from our experienced and
for Corporate Governance category. The Bank Construction sector, we will form dedicated prudent Board of Directors. And, finally to our
also achieved Third prize for Best Presented Monitoring Team at Corporate Office. shareholders, I reiterate our commitment to
Annual Reports by ICAB for its Annual implement our business strategy and ensure
Integrated Report 2016 under Corporate Along with RMG and textile, we will
prioritize to finance construction & delivering sustainable earnings growth in line
Governance Disclosures and ‘Certificate of with our noble vision of being a part to build
Merit’(4th position) under Integrated Reporting Infrastructure Project, fuel & power, steel &
Iron, Cement, Healthcare sector etc. poverty free Bangladesh.
Category from the Institute of Chartered
Accountants of Bangladesh(ICAB). Besides For CMSE segment, priority will be given to
these, the Bank also awarded the prestigious manufacturing, service enterprise, women
‘Bangladesh Bank Remittance Award’ for entrepreneurs and cluster based financing.
highest volume foreign currency drawing We will target to flourish in this segment
through this Bank in 2016. For Sustainability through our Agent Banking Channel.
Report 2016, the Bank garnered Best We have already started providing Md. Arfan Ali
Sustainability Report category overseas in the Investment facilities to Islamic Banking President and Managing Director
13th Sustainability Reporting Awards (SRA) customers through our conventional
by NCSR (National Centre for Sustainability branches under “online service unit” of
Reporting) Jakarta, Indonesia. Islamic Banking. Along with the five Islamic
STRATEGIC PRIORITIES FOR 2018 Windows, our conventional Banking
Considering the market scenario, especially Branches will book Investment clients
against shrinking liquidity and regulatory under online Islamic Banking services. We
requirement, we will take holistic approach hope for significant expansion in Islamic
to maintain our Balance Sheet indicators Banking Business this year.
like Advance Deposit Ratio (ADR), LCR From Risk Management perspective, the
(Liquidity Coverage Ratio), NSFR (Net main focus will be on capital optimization
Stable Funding Ratio), Commitment etc. through better risk management,
within limit through combined effort of digitization of Capital Assessment process,
Business, CRM and Treasury. enhanced information coverage for risk
We will focus on mobilizing adequate analysis and adoption of advanced risk
deposit, especially low cost deposit management models for liquidity, market
through our Corporate Office, Branch and and asset-liability management risks. We
Agent Banking Channels in a collective have already initiated the development
effort from all level of employees. process of Internal Credit Rating System
(ICRS). Upon successful implementation,
Like previous year, loan recovery and we will be move to Internal Rating Based
regularization of classified and non- Approach (IRB) for credit risk assessment.
performing loan (NPL) will remain our top
most priority. We will continue to engage We will continue to improve our Alternative
our Corporate Office employees to assist Delivery Channel to serve the customers
Special Asset Management Department with modern and Innovative banking
(SAMD) and Branches to expedite recovery product and services. We are working
process. Strong supervision, follow-up and on digital account opening process,
monitoring of classified and NPL accounts e-commerce and e-payment solution, QR
will be ensured for recovery of loans. We code based payment system etc.
will give special emphasize on recovery of
We will continue to expand our Agent
our written-off loans this year. Both legal
Banking Channel further across the

Bank Asia Limited

56
Segment
Analysis
Bank Asia
Consolidated
Operating
Revenue
(MillionTaka)

Conventional 21,062
Islamic 1,099
OBU 647
Local Subsidiaries 536
Foreign Subsidiaries 51

Total
Assets Profit
(MillionTaka) before tax
(MillionTaka)
Conventional 258,162
Conventional 3,443
Islamic 15,091
Islamic 399
OBU 15,744
Local Subsidiaries 6,301
OBU 215
Foreign Subsidiaries 264 Local Subsidiaries 149
Foreign Subsidiaries -9
Bank Asia
Solo
Operating
Revenue
(MillionTaka)
Conventional 21,062
Islamic 1,099
OBU 647

Total Profit
Assets before tax
(MillionTaka) (MillionTaka)
Conventional 258,162 Conventional 3,443
Islamic 15,091 Islamic 399
OBU 15,744 OBU 215

Annual Integrated Report 2017

57
 DIRECTORS’
REPORT

Bank Asia Limited

58
Annual Integrated Report 2017
59
 World
Economy
Economic activity of the year 2017 reveals 6.5% compared to that of 6.4% in FY 2016. were steadily upward in 2017.
a promising scenario as compared to the Due to strong demand for metals, particularly
preceding year. Broad-based upward revisions GLOBAL TRADE in China’s property, infrastructure and
of the growth outcomes in the Euro zone, According to WTO, volume of world manufacturing sectors, prices have steadily
Japan, emerge Asia and Russia in the first merchandise trade has grown by 3.6% in 2017
Commodity price indexes, monthly
half of 2017, were better than expected and and this growth is estimated to be within
US$, 2010=100
downward revisions were observed for the 150
Export
United States and the United Kingdom. But the
Other Regions
recovery of the past recession is not complete Asia
130

while the baseline outlook is strengthening, Europe 110

South & Central America
growth remains weak in many countries and North America
Agriculture
90
inflation is below target in most advanced Developing Economies
Developed Economies
economies. Commodity exporters, especially 70 Metals
-5.0 0.0 5.0 10.0 15.0 20.0 25.0
of fuel, are particularly hard hit as their 50
2013 2014 2015 2016 2017 Energy
adjustment to a sharp step down in foreign
earnings continues. Short-term risks are 30
Jan - 2010 Jan - 2012 Jan - 2014 Jan - 2016 Jan - 2018
Import
broadly balanced; medium-term risks are still 20.0
tilted to the downside. increased since January 2016 and broken the
record of last two years. World Bank forecasted
GLOBAL GDP GROWTH 0.0 that, with the exception of iron ore, metals
2013 2014 2016 2017
According to IMF, in the year 2017, the growth 2015
prices are expected to increase moderately in
in the Global Output was 3.7% in 2017 this was 2018.
0.5% point higher than in 2016. The growth -20.0 Agricultural product prices have slightly
Developed Economies Developing Economies
was mainly due to positive growth in Europe North America South and Central America declined during the year 2017 and showed a
and Asia. Global growth forecasts for 2018 Europe Asia downward trend for the last two years.
and 2019 have been revised upward by 0.2 % Source: World Trade Organization
point to 3.9%. The strength in global growth 3.2% in 2018. The major reasons behind GLOBAL INFLATION RATE
is broad-based across most advanced and the growth in World trade are due to In line with the preceding year, the inflation
emerging economies. The Chinese economy continued growth in investment, particularly rate has sustained its lower level at 3.2% in the
alone contributed to one-third of the global among advanced economies, increased FY 2017. The limitation of oil production by
growth during the year. The advanced manufacturing output in Asia-mainly in OPEC and Russia contributed to a spike in the
economies have experienced a relatively technological manufacturing. However, there inflation rate for the advanced economy but
higher growth in the GDP as the growth for is uncertainty regarding near-term economic showed a declining trend for the emerging and
fiscal year (FY) 2017 stood at 2.2% from 1.7% and policy developments. developing countries. However, the overall
for the previous FY. Among the advanced impact was suitable for the global economy.
economies, the condition of US improved as GLOBAL COMMODITY MARKETS Amongst the SAARC region, the war torn
it experienced a growth of 2.2% in FY 2017 Industrial commodities price showed an Afghanistan registered an inflation rate high as
compared to that of 1.5% in the previous FY. upward trend in 2017 due to increase in 7.2% when Maldives exhibited an inflation rate
The growth rate for the UK slumped to 1.7% demand for the same and rise in oil price, of only 2.1%. The advanced economy seems to
in FY 2017 due to the Brexit referendum and while most agricultural prices remained sustain a 1.5% inflation rate but is expected to
turbulent political conditions from 1.8%. broadly stable throughout the year. Crude oil see a spark in FY 2018 as much as 1.9%.
price reached at $53 per barrel (bbl) in 2017 Amongst the developed economies, the US
On the other hand, the overall GDP growth rate which was $43/bbl in 2016 and is expected registered only 1.8% inflation rate compared to
of South Asia plummeted to 6.6% in FY 2017 to cross $56/bbl in 2018. Natural Gas price in 2.2% in the preceding year. The situation was
in contrast with 6.8% in FY 2016. The emerging Europe and Liquefied Natural Gas (LNG) in reverse for the UK as the inflation rate sprout
and developing Asia witnessed a growth of Asia, which are partly linked to oil industry, to 2.8% in FY 2017 compared to 1.2% in FY

Board of
Directors at
18th AGM

Bank Asia Limited

60
Directors’
Report

2016. The emerging market and developing condition of the UK is somewhat similar to that of the US. The highest unemployment
economies marked a surge in the inflation rate can be found in the Republic of South Africa which was 27.6% compared to
rate contrasting to the preceding year by 3.5% 26.7% in the previous FY. Thailand denotes the best rate in terms of unemployment
while the Euro zone has maintained its 1.1% as it accounts for only 0.7% opposing to 0.8% in the previous year. Amongst the
inflation rate. SAARC countries, Bhutan has the modest figure as it accounts for only 3.2% of the
unemployment rate. China exhibited a 4% unemployment rate in both this and
GLOBAL FDI previous FY.
In the first half of 2017, global FDI flows
decreased by 3% compared to that in the MAJOR CHALLENGES
second half of 2016. It stood at USD 788 billion Global economic experts assume that the global economy may confront serious
but remained above 2013 and 2014 levels. By challenges in the months and years ahead. Although the global economic activity
region, FDI flows into the OECD area decreased is in upswing trend in FY 2017, there are few events that may hamper the overall
by 8% in the first half of 2017 compared to economic growth:
that in the second half of 2016 (from USD 502 a) The new foreign policy of Saudi Arabia is stimulating for engaging in
billion to USD 462 billion). FDI flows into EU fight against Yemen and blocking Qatar. This incident also hampers the OPEC
countries decreased even further by 46% (from relationship and increases the capital cost of Qatar with a tension of war hanging
USD 324 billion to USD 175 billion). around.
FDI inflow to G20 countries has decreased by
31% (from USD 599 billion to USD 415 billion). b) Declaration of Jerusalem as the capital of Israel led to violent upsurge in many
In the first half of 2017, the United States was countries including the Euro zone which sees an overall negative impact on
the largest recipient of FDI inflows worldwide the world trade despite the high economic growth.
(at USD 161 billion), followed by Switzerland c) Catalonia’s Independence Referendum threatens the peaceful coexistence
(USD 61 billion) and China (USD 55 billion). in the Euro region that sees the removal of financial headquarters out of that
area and an ebbing trend in the economic growth of that particular region.
GLOBAL UNEMPLOYMENT d) US moving out of Trans-Asia Partnership, withdrawing from the Paris Climate
The unemployment rate is estimated at 5.8% Agreement and refusing to comply to Nuclear Negotiation with Iran may
which is expected to be stable in 2018. The disrupt the world economic progress.
conditions in USA showed promising as the
unemployment rate came down to 4.4% OUTLOOK FOR 2018
compared to 4.9% in the preceding year. The Since the recent global financial crisis, the US economy reached a new mark and
the global economy exceeded expectations. The global economy has strengthened
Unemployment ( Million) at the end of 2017 which is also expected to continue in 2018. Economic power and
influence may continue to shift from west to east region. World industrial production
World has accelerated with a recovery in global trade that has been predominantly driven
by stronger demand in East Asia. Confidence and economic sentiment indicators
Developing Countries have also generally strengthened, especially in developed economies. Investment
conditions have improved, amid stable financial markets, strong credit growth, and
Emerging Countries a more solid macroeconomic outlook. Considering the lower inflation rate and
rising GDP growth rate, prospective outlooks for 2018 is predicted.
Developed Countries

0 50 100 150 200 250

Source
World Economic Outlook, October 2017, World Bank
2018 2017 2016 World Economic Situation and Prospects 2018, United Nations Annual Business
Commodity Markets Outlook, October 2017, World Bank Conference 2017

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61
 Bangladesh
Economy
The economic development of Bangladesh has shown a remarkable progress as annual GDP by 6.7%. This growth was mainly driven
growth has surpassed 6.4% on an average since 2010. During the fiscal year 2016-17 (FY17), by wholesale and retail trade, transport,
Bangladesh achieved record breaking GDP growth rate of 7.28% which is the highest ever storage and communication, financial
in the history of the country due to higher private investments, exports, and remittances. As intermediations, real estate, renting, business
per the government plan, the country’s GDP growth would reach over 8% by 2019, while it activities, community, social and personal
would be within 9% to 10% by 2030. Per capita income has estimated to reach USD 1,610
services sub-sectors.
in FY17 from USD 1,465 in FY16. It crossed the World Bank’s threshold for lower middle-
income country status in FY14 and now it’s folding to gain middle-income country status Among the sub-sectors containing positive
within 2021. The Global Economic Prospects, a flagship report of the World Bank Group, said growth, financial intermediation sub-sector
that Bangladesh stood at 17th position out of 134 countries which have a growth rate of 6.4 recorded highest growth of 9.1% in FY17 from
percent or more in 2017-18. 4.5% in FY16. Despite the positive growth, the
service sector’s share in GDP declined slightly
GDP Growth & Size of South Asia to 52.9% in FY17 as compared to 53.1% of the
preceding fiscal year. It is expected that rising
Country GDP Growth (%) GDP Size (USD Billion)
trend of service sector would continue its
Bangladesh 7.28 221.4 contribution in the economic growth, trade
India 7.21 2,263.5 and employment generation.
Pakistan 5.24 283.7 FISCAL OUTCOME
Sri Lanka 4.72 81.3 Expenditure
Government has estimated record breaking
Source: World Bank
budget of BDT 4,002.7 billion (18% of
Larger import and modest export made the deficit balance in the current account. With RMG GDP) for FY18 (budget 2017-18), which is
constituting more than 80% of the total country’s export, Bangladesh has become the world’s 26.20% higher than the actual expenditure
second largest ready-made garments exporter after China. The slight fluctuation of exchange in FY17. In FY18 budget, 52% is allocated
rate was concerning factor for the importers. Annual average inflation rate stood at 5.7% as to non-development expenditure, while
of December, 2017, which is little bit higher than 5.51% as of December, 2016. Bangladesh’s 40% has been allocated to development
foreign currency reserve crossed a record USD 33.22 billion as of December, 2017 which
is enough to meet the country’s import bills for nine months. But rise of non-performing expenditure and rest for others. In terms of
loans, lower capital adequacy and the overall governance issues are some challenges for the total allocation, growth is highest in Public
economy. Service (60.96%), Fuel and Power (45.03%)
and Industrial & Economic Services (43.27%)
AGRICULTURE SECTOR sector.
Bangladesh is primarily an agrarian economy in which contribution of agriculture is about The Annual Development Program (ADP)
14.74% of the country’s GDP (in FY17) and around 60% of the total labor force. Rice, Jute, in the revised budget for FY18 amounted
Sugarcane, Potato, Pulses, Wheat, Tea and Tobacco are the principal crops. However, to BDT 1,533.3 billion (6.9% of GDP) which
agriculture sector has seen challenges to raise its growth in FY17 due to flood in several major was 50.03% higher than the actual ADP in
crops producing areas. Aus, the first crop of the fiscal year, suffered in production loss in Q1 FY17. In FY18 budget, top allocation was
FY18. However, in FY17, agriculture sector is in increasing growth of 2.97% compared to 2.79% for education & technology (16.4%), public
in FY16, mainly due to the slight growth in animal farming, crops and horticulture sub-sectors. administration (13.6%), transportation
Government has planned to produce 361.8 Lac Metric Ton (LMT) of rice in FY 18 against (12.5%), interest payments (10.3%), and local
production of 338.0 LMT in FY17. Among the non-rice, total cereal crops (Wheat & Maize) is government (6.9%).
projected to reach 413.8 LMT in FY18 from 386.9 LMT of previous FY.
Revenue Collection
INDUSTRY SECTOR In the budget FY18, revenue collection target
Industry is the second largest sector in the GDP-pie which is fueled mainly by knitwear, is BDT 2879.91 billion, which is 31.80% higher
ready-made garments, cotton textile, pharmaceuticals, wood products, iron and steel, than that of FY17 (Revised). It is expected that
ceramic, cement, leather & leather products, plastic products etc. That means the economy is ongoing reforms & automation of revenue
transforming its nature from agricultural economy into industrial one. The overall growth in collection likely to boost NBR revenue.
industry sector slightly declined to 10.2% in FY17 from 11.1% in FY16, though the contribution Among the total revenue target, NBR Tax
from this sector has increased to 32.42% of total GDP from 31.54% of previous year. The Revenue target is 2,481.90 billion (86.18% of
growths of different sub-sectors of industry sector have declined except construction and total revenue target) which is 34.16% higher
small scale industry sub-sector in FY17 compared to FY16 which contributed to fall in the than that in revised budget for FY’17). Value
overall growth of industry sector. Added Tax (VAT) accounts for 912.54 billion
The large & medium scale manufacturing and small scale manufacturing sub-sector (36.8%) and Taxes on Income and Profit
contributed about 81.8% and 18.2% respectively of the total output of the manufacturing accounts for 851.76 billion (34.3%) of total
sector whereas growth of these large and medium scale industry sub-sectors declined to revenue collection of FY18. In this proposed
11.2%, followed by manufacturing sub- sector growth (11%). budget for FY’18, most of the tax rates
have been kept unchanged as that of FY’17
SERVICE SECTOR budget.
The service sector, also called tertiary sector, maintained its growth momentum and
contributed 52.9% of the share in overall GDP. The contribution of service sector is more than External Sector
50% of the total GDP. Moreover, it provides support for the development of industry sector External sectors in Bangladesh economy
and agriculture sector. In FY17, the service sector accelerated its performance and grew such as export, import and remittance

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Directors’
Report

have always played crucial role for the after exports. World Bank ranked Bangladesh stood at 5.44% in June 2017, while the
development path. 5th in terms of the stock of migrants and Bangladesh Bank Monetary Policy Statement
8th in terms of remittance earrings country (MPS, January-June 2017) inflation forecast
Export in the world. The remittance inflow shows ranged between 5.3-5.6%. The twelve
Export earnings increased slightly by 1.72% a decreasing trend since FY16. Remittance month average general inflation edged
in FY17 to USD 34,835.1 million from USD earnings decreased by 14.5% and 2.5% in up marginally to 5.70% in December 2017
34,257.2 million in FY16, of which, the export FY17 and FY16 respectively. Remittances from 5.52% of December, 2016. Rising food
from EPZ was USD 5,213.6 million and USD as percentage of GDP declined gradually inflation due to flash flood related crop
5,439.3 million in FY17 and FY16 respectively. from 8.2% in FY14 to 5.17% in FY17. Gross losses in the Northeastern haor region from
The export in first half of FY18 accounted for remittance earnings decreased to USD the middle of FY17 mainly accounted for the
17,916 million pointing out 7.2% growth over 12,769.6 million in FY17 from USD 14,931.1
the corresponding period of the preceding increase in headline inflation. The point to
million in FY16. However, during first six point general inflation increased to 5.83%
year. Export target was set USD 37,500 million months of FY18, the manpower exports of
for FY18 of which export target for July- in December 2017 from 5.03% of December
the country increased by 103,199 persons 2016. At the same period, non-food inflation
December FY18 was USD 17,875.00 million. (26.82%) compared to that of the same
Apparels (woven garments and knitwear decreased to 3.85% from 4.49% and food
period of last year. The shortfall of remittance
products) continued to occupy a very large inflation increased to 7.13% from 5.38%.
was mainly due to the decrease of oil
share about 81% of total export earnings and revenues, increase of digital hundi (using EXCHANGE RATE
registered slight increase in receipts from apps and software) and fiscal tightening in Recent exchange rate movement has
USD 28,094.2 million in FY16 to USD 28,149.8 the GCC countries. been consistent with maintaining export
million in FY17. Knitwear products showed competitiveness as well as encouraging
a growth of 3.0% in FY17 compared to FY16. Foreign Direct Investment (Fdi) remittance inflows. In FY17, BDT experienced
Consequently, export as percentage of GDP Foreign Direct Investment (FDI), 2nd a depreciation of 2.81% against US dollar
decreased to 14.0% in FY17 from 15.5% in largest component of financial account,
compared to 0.77% depreciation in FY16 due
FY16. Among the RMG export destinations of is recognized as one of the important
mainly to BB’s interventions in the foreign
2017, EU market accounts for 64% and USA components of Bangladesh’s foreign
exchange market to maintain stability as well
for 17.96% of total export. reserves. FDI inflows during FY17 increased
as to ensure external competitiveness.
by 22.52% and reached USD 2,454.81 million
Import from USD 2,003.53 million during FY16.
Import (fob) in FY17 stood at USD 43,491 Moreover, FDI inflows stood at USD 507.15 Monetary Policy
million achieving a higher growth of 9% million registering 3.24% growth during In FY18, Bangladesh Bank implemented
compared to USD 39,901 million in FY16, first quarter of FY18 compared to previous its monetary policy stance to achieve price
of which import by EPZ based import was quarter. stability, alongside supporting inclusive
USD 3190.7 million and USD 3286.9 in output and employment growth. The
FY17 and FY16 respectively. The import Balance of Payments (Bop) monetary program for FY18 takes into
in first half of FY18 stood at USD 2,5013.8 account the recent economic and financial
Bangladesh’s balance of payments (BoP)
million registering 19.71% growth from sector developments and will target a
recorded a surplus in FY17, despite
corresponding period of the previous year. monetary growth path aiming at keeping
unfavorable global economic condition.
Import of food grain recorded a significant GDP growth at 7.4% and average inflation
Overall balance recorded a surplus of USD
growth of 21.2% in FY17 mainly due to below 6.0%. The new monetary policy of
3,169 million compared to USD 5,036 million
increase of wheat import. Import of others second half of FY18 (MPS H2 FY18) has set
in FY16. The BoP surplus was supported
food items increased by 19.9% to 4,240.4 domestic credit growth unchanged at 15.8%;
mainly by financial account. Current account
million in FY17 from USD 3,536 million in whereas private sector credit growth target at
balance (CAB) showed a significant amount
FY16. Except negative growth of oil seeds 16.8% against a previous projection of 16.3%.
of deficit of USD 1,480 million during FY17,
(19%), all other items showed positive The public sector credit growth has reduced
mainly due to deficit in trade balance by USD
growth. Consumer and intermediate goods to 8.3% from 12.0%. The monetary program
9,472 million, CAB was a surplus of USD 4,262
increased by 4.5% to USD 2,1359.8 million in
million in FY16. The capital accounts surplus framework is based on the ceilings for broad
FY17 from USD 20,432.3 million in FY16. All
decreased to USD 314 million and the money and reserve money growth of 13.3%
items of capital goods and others categories
financial accounts surplus increased to USD and 12.0% respectively.
recorded a high growth of 11.2% to USD
4,179 million respectively in FY17. The CAB of
20,118.6 million in FY17 from USD 18,092.4
first half of FY18 has a deficit balance of USD BROAD MONEY
million in FY16. Settlement of import LCs
4,767 million, which was USD 543 million in According to MPS H2 FY18, Broad money (M2)
during July-December 2017 increased by
same period of FY17. The overall balance grew by 10.9% as of June 2017 and reached
9.17% and stood at USD 24.66 billion. On
showed USD 354 million deficit during Jul- 10.7% in December 2017; this rate is targeted
the other hand, fresh opening of import LCs
Dec 2017, which registered USD 2,265 million to grow at 13.3% in June 2018. The lower
during July-December 2017 increased by
surplus in same period of FY17. growth in broad money is driven by both net
74.76% and stood at USD 40.23 billion.
foreign asset (NFA) and net domestic asset
Remittance CPI INFLATION
(NDA).
Remittance is the second largest source of Annual average CPI inflation showed mixed
foreign currency earnings of Bangladesh trend in FY17. The headline inflation rate

Annual Integrated Report 2017

63
 INTEREST RATE growth pace in 2018. Private sector actual
The weighted average interest rates on credit growth has exceeded than target level
deposits gradually declined from a pick of to achieve the desired growth. Although
8.54% in FY13 to 4.84% in FY17 and finally inflation is in rising trend due to food prices
increased to 4.91% in December 2017. but this is still under control. The Executive
Similarly, following the downward trend, Committee of the National Economic Council
weighted average interest rates on lending (ECNEC) approved 13 mega projects worth
rate also gradually declined to 9.56% in FY17 BDT 124.16 billion marking a prospect for
from a pick of 13.75% in FY12; however, at investment opportunities and growth in
the end of 2017, this rate is lowered to 9.35%. business in FY18.
The intermediation spreads between lending However, there are a number of challenges
and deposit rates were above 5% up to FY14, for the Bangladesh economy for journey
which has gradually narrowed to 4.72% in in 2018. Overall balance of payments is
FY17 and 4.44% at the end of 2017. showing negative balance, which may widen
further due to heavy import growth and
CALL MONEY
weaker export performances and remittance
The weighted average call money rate in the
inflows. The upcoming National Election
inter-bank money market increased to 3.92%
expected to be held in the early 2019 may
in December 2017 from 3.62% in December
create uncertainty on investment climate of
2016. This rate is ranged from 3.68% to 3.93%
the country. Governance issue around the
during FY17. During the year 2017, total
banking sector is another big challenge for
lending volume of call money was BDT 16,684
the economy. Moreover, influx of roughly one
billion, recording average volume of BDT
million Rohingya from Arakan of Myanmar is
1,390 billion per month.
putting an upward demand for import of food
FOREIGN EXCHANGE RESERVE
and their alleged involvement in different
The gross foreign exchange reserve of BB
anti-social activities over the country is also
stood at USD 33.23 billion as of end of
challenge for the economy.
December 2017, registering positive growth
of 3.54%, compared to USD 32.09 billion Source
as of end of December 2016. This reserve Bangladesh Bank Annual Report 2016-2017
is equivalent to import liability of around 8 Asian Development Outlook 2017
months. At the beginning of FY17, foreign Scheduled Banks Statistics, Jul-Sep 2017
exchange reserves was USD 30.13 billion Bangladesh Bank Quarterly, Jul-Sep 2017
which grew steadily (10.89%) throughout the
year and touched the mark of USD 33 billion
on June 21, 2017 and reached USD 33.41
billion at the end of FY17.
SOVEREIGN RATINGS
Bangladesh achieves Ba3 (Moody’s) and
BB-(Standard and Poor’s) with stable outlook
for the 8th consecutive years. Stable real GDP
growth and strong external balances have
helped Bangladesh to achieve BB- rating
with stable outlook from Fitch Ratings for
the fourth time. In general, a credit rating
is used by sovereign wealth funds, pension
funds and other investors to gauge the credit
worthiness of Bangladesh, thus having a big
impact on the country’s borrowing costs.
OUTLOOK OF 2018
THE OPPORTUNITY & CHALLENGES
The year 2018 will be a turning point for
Bangladesh in many ways. Bangladesh will
prepare to graduate from the least developed
country status in 2018. Major economic
indicators performed at satisfactory level
in the outgoing year 2017. The economy is
showing prospect of maintaining the steady

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Banking Industry
Exploring 2017
Banking industry is considered as the nerve the extension of the tenure from six years to nine years. The Bangladesh Bank (BB), being
and artery of an economy. It plays a pivotal the central bank, exerts the supervisory controls over the banking sector. Besides, prudential
role for the development of Bangladesh guidelines for agent banking operation, loan classification and provisioning, amendment of
economy. The banking industry has seen a guidelines on credit card operations of banks, foreign direct investment promotion project
strong pickup in adoption of digital offerings. (FDIPP), promotion of cashless transaction and issuance of agricultural & rural credit policy
Technology based services are facilitating the & program for the FY 2017-18 were the key steps of central bank to strengthen sustainable
banking industry to reach remote customers. development of the banking industry.
In line with the continued political stability Banking Sector in Bangladesh
in 2017, the banking industry has sustained The Banking Industry has seen a rise in the deposit rate by the second half of 2017 while
a smooth growth through financial inclusion marking a weighted average deposit rate of 4.91% and lending rate 9.35% with a spread of
and business expansion. Banking sector 4.44% at the end of 2017. Total deposit of the banking sector in September 2017 stood at
has witnessed a sound operating profit in BDT 9,544.5 billion showing a point to point growth of 10.8%. Similarly total advances stood
2017 despite the downward pressure of loan at BDT 7,458.4 billion marking a point to point growth of 18.7%. Gradual increase of AD ratio
interest rate and growing classified loan. has become major concern for banking industry. Regulatory body has also specified the
Banking industry of Bangladesh entered boundary of AD ratio for banking industry as a pre-step to ensure the sound liquidity position
into the Basel III from Basel II regime since of commercial banks. As on 31st December 2017, banking industry has maintained BDT 2,596
January 2015. Now, the industry is gradually billion in total liquid assets by keeping BDT 866.96 billion as excess liquidity. At the end of the
preparing to adopt the full implementation year, call money rate slightly increased to 3.92% from the record low of 3.54% as the credit
of Basel III by the year 2019. The banking growth surpassed the deposit growth. The key profitability indicators - return on assets (ROA)
sector represents moderate to higher stability and return on equity (ROE) stood at 0.34% and 4.66% respectively as on 30th September 2017
despite the pressure to rationalize the AD as compared to 0.7% and 9.9% respectively recorded in 2016.
Ratio, unpleasant competition, and growing The banking industry has maintained a provision of BDT 399.7 billion against required
trend of non-performing loans (NPL). provision of BDT 463.1 billion, marking a shortfall provision of BDT 63.4 billion as of 30th
Regulation of the Banking Industry September 2017. At the same period, the average CRAR (Capital to Risk Weighted Asset Ratio)
Bank Companies Act 1991 and subsequent for banking industry was 10.6% when the CRAR for the private commercial banks, state banks
amendment in 2017 mainly guide the and foreign banks was 12.2%, 5.6% and 24.0% respectively. As of 30th September 2017, the
commercial banks in Bangladesh. The latest cumulative NPLs of the banks reached BDT 803.1 billion or 10.7% of NPL to total loans. This
amendment allows the number of directors ratio has slightly decreased to 9.3% at the end of the 2017.
from two to four from a single family and

MONETARY AGGREGATES Deposit, Advance & AD Ratio

Actual Program 12,000 80%
Item
Jun–17 Dec–17 Dec-17 MPS Jun-18 MPS 10,000 78%
BDT in Billion

Net Foreign Assets 11.5 0.5 4.7 5.5 8,000 76%

AD Ratio
Net Domestic Assets 10.7 14.4 15.9 16.7 6,000 74%

Domestic Credit 11.2 14.5 14.4 15.8 4,000 72%

Credit to the public sector -13 -9.3 3.8 12.1 2,000 70%

Credit to the private sector 15.7 18.1 16.2 16.3 - 68%

Sep-15

Sep-16

Sep-17
Nov-15

Nov-16
May-16

May-17
Jul-16

Jul-17
Jan-16

Jan-17
Mar-16

Mar-17

Broad money 10.9 10.7 12.9 13.9

Reserve money 16.3 13.3 12.8 12
Deposit Advance ADR (%)
Source: Monetary Policy Statement, Jan-Jun 2018
STRUCTURE OF THE BANKING SYSTEM IN BANGLADESH (UPTO September, 2017)
Deposit Advance
NPL
No. of Number of Deposits P2P Advances P2P CRAR AD Ratio ROE ROA
Type of Bank Ratios
Banks Branches (in Billion) growth, (in Billion) growth, (%) (%) (%)P (%)P
(%)
(%) (%)
State Owned Banks (SCB) 06 3,714 2,619 7.8 1,353 11.4 5.6 51.7 -19.4 -0.6 29.3
Specialized Banks (DFI) 02 1,407 284 12.9 233 1.0 -33.5 81.9 -8.1 -1.6 23.8
Private Banks (PCB) 40 4,562 6,228 12.0 5,602 21.7 12.2 89.9 7.5 0.7 6.0
Foreign Banks (FCB) 09 70 413 10.5 271 13.9 24.0 65.5 10.8 2.2 7.9
Total 57 9,753 9,545 10.8 7,458 18.7 10.6 78.1 4.7 0.3 10.7
Source: Bangladesh Bank Annual Report 2016-17; Scheduled Banks Statistics, Jul- Sep 2017; P = Provisional

Annual Integrated Report 2017

65
 Review of operations of
Bank Asia in 2017

Stable political as well as business Bank’s import increased by 18% and previous year. The Bank is standing on
environment leads the economy to grow stood at USD 2,156 million (Tk. 181,468 sound footing where strong capital base
moderately but still the banking industry million) in 2017 where in 2016 it was USD is playing a key role for smooth business
had to pass another challenging year in 1,824 million (Tk. 148,724) million. Export growth. This strong capital base helped the
respect of excess liquidity pressure, rising increased by 13% and reached USD 1,457 Bank to maintain a very satisfactory Capital
non-performing loan, declining interest million (Tk. 118,172) million which was to Risk Weighted Assets Ratio (CRAR) of
rate on loans and advances, lower rate on USD 1,286 million (Tk. 103,139 million) in 14.89%.
T-bill/bond and so on. Yield on advance of the previous year. Inward remittance in
the bank declined by 0.83% in 2017 and 2017 showed a growth of 23% and reached To maintain the increasing demand of
came down to 9.03% from 9.86%. Bank’s USD 654 million (Tk. 51,778 million) customers for innovative services and
total assets reached Tk. 288,997 million compared to USD 532 million (Tk. 41,665 a balanced distribution of network, the
in 2017 compared to Tk. 253,196 million million) in 2016. Although bank’s core Bank opened 9 new branches in 2017. The
in 2016 with a growth of 14.14% and income increased, investment income whole network of Bank Asia now consists
total capital reached Tk. 32,914 million exhibited negative growth for reduction of 116 branches, 4 SME service centers, 5
from Tk. 24,775 million with a growth of of yield on treasury bill/bond. Operating Islamic windows, 132 own ATMs and more
33%. Deposit reached Tk. 207,041 million profit and net profit after tax of the bank than 7,500+ shared ATMs, 1 Brokerage
compared to Tk. 191,273 million with a stood at Tk. 6,688 million and Tk. 2,048 Company in Bangladesh and 2 exchange
growth of 8.24% and Loans and advances million respectively. The Bank did much houses located in UK and USA. The Bank
was 20.72% higher than the preceding year better in restraining growth of classified is also operating 2 branches of BA Express
and stood at Tk. 197,504 million. loans and the year ended with CL ratio USA Inc. in New York since 2014. All the
to 4.38% in 2017 compared to 5.41% of operations of the Bank are interconnected
and integrated through state of the art
networking technology.

Corporate & Large Loan

Considering the increasing economic Corporate & Large Loan Division is the Department, General Finance Unit, and
growth of our country, Corporate & Large single largest business unit of the Bank. Syndication & Structured Finance Unit.
Loan Division of Bank Asia Limited is This division deals with customers having A snapshot of these three strategic arms
providing the best possible financial total funded limit of Tk. 200 million and of corporate business are as follows:
products & services with expertise and above or total exposure of Tk. 300 million
dedication to attain sustainable growth and above. In addition to that entire Export Finance: Export Finance, emerged
and development. The Bank has financed portfolio of Financial Institutions (FIs) as a stand alone department under
in major corporate business sectors, and export oriented industries are being Corporate & Large Loan, facilitates export
which are large scale manufactures handled by this division. oriented clients in a more resourceful
including food, beverage, RMG and textile, and proficient manner while identifying
construction, power plants, transports, This division comprises of three major business needs and devising a wide
institutions, trade services, housing, departments/units; Export Finance array of services for capital expenditure
utility services etc. and working capital engagement in the
special forms of back to back letter of
credit, packing credit, bill purchased
and discounted etc.
General Corporate Finance:
Two wings formed for proper and smooth
administration under General Corporate
Finance deal with all general modes of
finance spreading from
Bank Asia
refinanced Provita
short-term to long-term in nature
Chicks Ltd. under in the likes of demand guarantee,
Long Term Financial letter of credit, demand loan, loan
Facility (LTFF) of
Financial Sector against trust receipt, time loan,
Support Project of term loan, and lease financing etc.
Bangladesh Bank

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Directors’
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Syndication and Structured Finance: Arranged refinance of USD 7.41 million Signed an agreement with Bangladesh
Another department under Corporate under the Long Term Financial Facility Bank to finance export oriented
& Large Loan which deals with (LTFF) of Financial Sector Support Textiles & Textiles Products and Leather
arrangement of fund for large projects Project of Bangladesh Bank on account Manufacturing Industries under
of corporate clients therefore spreading of Provita Chicks Ltd. Green Transformation Fund (GTF) of
the risk amongst the partner FIs/Banks Bangladesh Bank.
and also offers agency services. Financed Euro 5.17 million under the
Export Credit Agency (ECA) to Engreen Entered into arrangement with
Major Activities in 2017: Sharishabari Solar Plant Ltd. for Bangladesh Bank on for two step loan
As on December 31, 2017, total loan establishing a 3-MWp (megawatt-peak) for Urban Building Safety Project (under
portfolio of C&LL was Tk.122,520 Grid-Tied SPV (solar photovoltaic) JICA/Bangladesh Bank Refinancing
million which is around 62% of the total independent power plant on 8.23 acres Scheme).
loan portfolio of the Bank. of land at Sharishabari of Jamalpur.
This is first of its kind power project Signed agreement with Bangladesh
Clients handled by the division ever established in Bangladesh which Bank for Green Finance under its
executed export worth Tk.106,720 has already gone to COD in 2017. refinance scheme.
million & import worth
Tk.144,593.52million in 2017.

Syndication & Structured Finance

Bank Asia has been operating in the earning scarce foreign currency through two Syndication deals worth Tk.67.10 billion
syndication loan market for than one exporting. SSFU provides financial in Refinery and Cement Sector. We are in
and a half decade. Our expertise in loan solutions to infrastructure, industrial the process of raising of Syndicated Term
syndication facilitated entrepreneurs service oriented projects, power projects, Loan of Tk. 64 billion as Lead Arranger
to successfully accomplish a number refinery plant, textiles, ceramics, pulp & and Agent for setting up a Petroleum
of significant projects to assist the real paper, telecom, steel, cement etc. The unit Refinery project by Bashundhara Oil & Gas
sectors of the economy. also plays a vital role to accommodate Company Limited. This would be the largest
Since 2000, Bank Asia’s Syndication & different types of large loans for the Syndication deal in the banking industry.
Structured Finance Unit (SSFU) C & LL has Bank’s corporate clients- i.e. Project Term
been extensively engaged in syndicate Loan (Local & Foreign Currency) including Besides, Bank Asia Ltd, is acting as Lead
activies, acting as lead arranger and agent BMRE of projects, Working Capital Arranger and Agent for Bashundhara
in 18 syndications totaling Tk. 12,015 Financing, Short Term Loan, financing Industrial Complex Ltd. to enhance
million for various projects, some of which under Long Term Financing Facility (LTFF), the production capacity of the existing
are import substitutes, have created Offshore Financing, Bridge Financing, cement factory (Ball Mill) at Madongonj,
substantial amount of employment investment in alternative product etc. Narayangonj. After the proposed expansion,
opportunities, and are saving as well as During the year 2017, we have launched total production capacity of the project shall
be 3,000,000 MT per annum having total
project cost of Tk.4,498.98 million, which
will be financed by Syndicated Term Loan
facility of Tk. Tk. 3,146.13 million.

We are committed that in 2018, our SSFU

will continue to work on deepening existing
relationships and sourcing new clients
for generating new income opportunities
and to offer more innovative value added
services for the changing macro-economic
landscape which will place more emphasis
upon loan syndication to support the
economy of the country.
Handover Ceremony of Feasibility Report by Bashundhara Oil & Gas Company Limited

Annual Integrated Report 2017

67
 Directors’
Report

CMSME Banking & Agri/Rural Credit

MSME Division and Agriculture Division the Electrical Products Manufacturing (CMSMEs). We worked on extending banking
has been restructured and incorporated Cluster. services to recognized or unrecognized
under Small Enterprise & Special Programs Partnered with Hishab Ltd. under SME clusters by adopting a 4-C approach:
Loan, Medium Enterprises and Agriculture the banner of “SME Digital Market Customer focus, Cost control, Cross sell
Department form the year 2015. Initiative” for–Using Mobile voice based and Containing risk. Throughout the year,
financial data record keeping and we financed 330 entrepreneurs in different
COTTAGE, MICRO & SMALL utilize the data for potential financing. CMSME clusters with the disbursement
ENTERPRISE FINANCING Participated in “Banker-SME Women amount of Tk. 175 mln. Currently the bank
Small Enterprise & Special Programs Entrepreneur Gathering & Product Fair- is actively working on developing and
Department presently deals with the 2017” organized by Bangladesh Bank. financing in the following clusters-
Cottage, Micro & Small Enterprise Participated in the “Entrepreneur-
business and in connection to that we Banker Match Making & Loan Electric & electronic cluster- Jurain,
are driving business by taking different Disbursement program with Central Muradpur, Kadomtoli, Syampur, Dhaka.
initiatives to boost up financing to this Bank” held at Tarail Kishorgonj, Handloom & Specialized Cloth Cluster -
sector all around the year. In 2017, we Maijdee Noakhali, Comilla and Jessore. Adhamdighi, Bogra
strongly focused on cottage & micro Organized 10 training season and Hosiery Cluster - Jurain, Kadomtoli, Dhaka.
enterprise financing, cluster financing, provided training to 430 officers of Bamboo & Cane Cluster - Rajanagar,
new entrepreneurship development the Bank on understanding SME Sirajdikhan, Munshigonj.
financing, promoting rural people as well business, aware the business need and Shitol Pati Cluster- Joynshar, Sirajdikhan,
as rural women entrepreneurship, creating assessment of finance of the CMSME Munshigonj.
business network for CMSE entrepreneurs customers and Digital SME loan Jamdhani Cluster - Moikoli, Tarabo,
and financing in untapped areas to the application processing. Rupgonj, Narayangonj.
unbanked new entrepreneurs. As we are the first financial institution RMG Cluster - Dolagaon, Nimtola,
in the industry to introduce TAB based Munshigonj.
As we are listing down our initiatives in Pottery Cluster - Ultapara, Noihati, Kaliakoir.
the year 2017, Bank Asia continued close digital SME & Agri proposal processing,
in 2017 we processed 1700 new Broom Cluster- Keranigonj, Dhaka
association with different MSME activities Card Cluster- Kaliakoir, Gazipur
like; proposals through this DIGANTA online
credit approval system Sports Ware Cluster- Bondor, Narayangonj

The SE & SPL Department of the Bank Apart from the above, the Bank arranged Financial Highlights of 2017
has arranged launching of 3 new different business meeting with the
products titled “Nilima”-for Women existing and potential clients throughout The Cottage, Micro and Small Portfolio
Entrepreneur, “Bahon”-for Commercial the year. stood at Tk. 7,010 mln compared to
Vehicle Finance and “Astha”- Special Cluster Financing previous year’s Tk. 5,441.18 mln with a
Current Deposit account for SME As a commercial bank, Bank Asia also growth of 28.8%
Entrepreneur. adopted full-fledged digitized cluster- Medium Enterprise Portfolio stood at Tk.
Created new partnership with SME based approach for financing cottage, 25,850 mln compared to previous year’s
Foundation for financing to the micro, small and medium enterprises Tk. 20,826 mln with a YOY growth of
Women Entrepreneurs and financing to 24.1%
4,394 no. of new CMSE borrowers were
added to the CMSE portfolio in 2017 with
a volume of 4,270 million
1,413 new customers were on boarded in
Mid Segment Enterprise with a volume of
Tk. 21,626 mln

MSME
Portfolio
in 2017
In Million Taka
Banker-SME
Women Trade 11,422.89
Entrepreneur Manufacturing 8,811.24
Gathering & Service 9,857.08
Product Fair-
WE 186.55
2017

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Agriculture/Rural Credit

Bank Asia Ltd. has contributed greatly in Agricultural/ Rural credit sector. FY 2016-2017 was a good continuation of target achievement
like every year. We have achieved 123.88% against our total disbursement target of Taka 2,100 million and distributed the credit facility
to 79,767 rural farmers. Bank Asia has superseded the given target of Agri credit set by Bangladesh Bank consecutively last three years.
Till to date, 500,890 number of farmers have received financial assistance from us.

Status of Agricultural/Rural Credit as on 31-12-2017 is given below:

Million Taka
Direct NGO
Particulars Total
Network Network
Disbursement
873.49 2,721.03 3,594.52
(from 01-01-2017 to 31-12-2017)
Outstanding (as on 31-12-2017) 624.17 3,458.48 4,082.65
No. of beneficiary 21,084 71,047 92,139

Besides target achievement in every sector of Agricultural credit in 2017,

Bank Asia emphasized to extend credit facilities in the following contemporary form

A-Card 10 Taka Account Partnership with different

The Smart form of We facilitated 2,140 borrowers international Organization
Agricultural credit was by disbursing Taka48.39 With the aim of attaining
propagated into 1,367 rural million and received refinance international level of
of Taka 45.50 million from agricultural/rural financing, Bank
farmers. Total Taka 22.00
Bangladesh Bank in the year Asia has cruised partnership
million was used through 2017. Bangladesh Bank has with different international
A-card in this year. appreciated Bank Asia Ltd. for organizations like USAID AESA
the contribution in this sector. project, USAID AVC Project, Swiss
Contact, NAFCO etc.

Apprication letter received by Bank Asia from Bangladesh Bank for significant contribution in
disbursing loan to 10 taka savings account holders
Poultry farm financed by Bank Asia

Annual Integrated Report 2017

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Report

Mid-segment Enterprise Financing

Currently, most of the big loans given out single borrower exposure. The industry strategies have been formulated to meet
by the banks are at high risk of failing. outstanding on medium enterprise loan the challenges to reach the goal of medium
Therefore it is imperative that banks is Tk. 814,830 million in our country.Our segment business of our bank. Bangladesh
move away from big loans to maintain bank’s present ME portfolio is Tk. 25,850 Bank encourages banks extending loans to
financial stability and reduce loan defaults. million as on 31.12.2017 which is holding this preferential sector for more financial
As such it is wiser to focus on small and 3.17% market share. Presently the market inclusion. Bank Asia also echoed the same
medium enterprises. Presently our Mid- gap is Tk.706,731 million which denotes a preference.
segment Enterprise (ME) is dealing with significant prospect to grow up in medium
all branches’ credit proposals with credit segment.A robust but pragmatic budget
limit up to maximum Tk. 300 million as a has been set for the year 2018 and effective

The business position of Mid-segment Enterprise (ME) as on December 2017:

million taka
Year end position 2016 Yearly Budget 2017 Actual December, 2017 Budget Vs Actual Net Growth 2016 Vs 2017 Growth % over 2016

20,826 25,792 25,850 100.22% 5,024 24%

Credit Administration
The function of Credit Administration Departmental Activities in 2017
Department (CAD) is to ensure quick,
smooth and safe running of the i. Systemized 187,493 jobs including changes of limit, terms & conditions, changes
of interest rate, installment size, number of installment modification, allowing
operations against the most critical of EOL / L/C, time extension of composite limit along with deferral
functions of loans and advances
extended to the borrowers. Its main ii. Checked of 163,044 major documents against 12,131 borrowers
objective is to support and control iii. Monitored 27,552 accounts (Past due loans) and reviewed 8,108 expired loans
the extension of all credits centrally accounts for regularization
by systemizing the credit facilities and
iv. Regularized 332 deferral documents out of 579 documents of all branches
security documents as per terms and
conditions of sanction letters, working v. Downloaded CIB reports of 41,804 borrower & uploaded 68,257 accounts through
with critical CIB operation, regulatory online system and against which we have realized Tk. 2.24 million as CIB charges
reporting, monitoring expired loan, vi. Correction of CIB database against 630 borrowers from Bangladesh Bank
deferral documents and checking copies
vii. Submitted 279 statements to Bangladesh Bank and other bodies
of major security documents. As the (monthly/quarterly /half yearly/yearly) through conventional and RIT after checking
bank is growing in terms of number
and size of loans, diverse products and Planning for 2018
clients, complex process and procedures 1. Implementation of collateral security database against loans & advances and separate
for compliance requirements, module for updating information as per Bangladesh Bank instruction
particularly in relation to reporting and
2. Conversion of CIB ftp server to MISDB for smooth service (CIB Report) to the
maintaining prudential standards, the Branch / Agri / SME center
role of credit administration department
is challenging and crucial. 3. Up-gradation of core banking system for CIB information
4. Introduction of SOD request through MISDB for faster service to branch
5. Inclusion of major documents in MISDB as a part of online documentation and
Deferral reporting through MISDB

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Directors’
Report

Sectoral Distribution of Credit

The Bank’s loans and advances portfolio increased to Tk. 197,504.14 million achieving a growth of 21%. Sector wise distribution of
loans and advances is as follows:
Million Taka

2017 2016
SL.
Sectors/Sub-Sectors
No Million Taka % of Funded Loan Million Taka % of Funded Loan

1 Industries
Agriculture and Jute 4,074.80 2.06% 2,340.58 1.43%
Cement - 0.00% 517.00 0.32%
Chemicals 1,632.80 0.83% 1,983.39 1.21%
Electronics 3,794.80 1.92% 2,549.37 1.56%
Food & Allied 11,966.50 6.06% 12,282.27 7.51%
Paper 8,648.30 4.38% 7,739.05 4.73%
Readymade Garments 22,666.40 11.48% 18,153.01 11.10%
Real Estate 4,732.80 2.40% 11,992.02 7.33%
Steel 6,225.20 3.15% 9,475.07 5.79%
Textile 20,274.90 10.27% 13,617.37 8.32%
Others 33,457.63 16.94% 13,313.31 8.14%
Subtotal 117,474.13 59.48% 93,962.44 57.43%
2 Infrastructure
Power 2,023.40 1.02% 50.52 0.03%
Telecom 348.50 0.18% 453.30 0.28%
Construction 5,280.50 2.67% 5,758.25 3.52%
Transport 2,823.90 1.43% 2,359.10 1.44%
Sub total 10,476.30 5.30% 8,621.17 5.27%
3 Commercial Lending 34,740.50 17.59% 32,044.40 19.59%
4 Export Financing 11,620.46 5.88% 12,668.20 7.74%
5 House Building Loan 1,072.53 0.54% 923.36 0.56%
6 Consumer Credit Scheme 9,425.51 4.77% 7,076.44 4.33%
7 Small & Medium Enterprise 4,945.19 2.50% 3,957.23 2.42%
8 Staff Loan 1,323.51 0.67% 1,329.10 0.81%
9 Credit Card 1,600.31 0.81% 1,252.44 0.77%
10 Non-Banking Financial Institution 4,825.70 2.44% 1,775.00 1.08%
Total 197,504.14 100.00% 163,609.78 100.00%

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 Directors’
Report

Credit Risk Management

Policy development is regarded as an indispensable task of Credit Risk Management Credit Rating & CRG
with a view to ensuring sustainable and performing assets development of Bank Asia CRM Department through its rigorous
Limited. It is widely known that nature of business is changing with the advancement of persuasion and enforcement helps branches
technology and arrival of different needs from different customers. CRM Department plays to ensure credit rating and credit risk grading
a vital role in formulating cutting-edge policy to capture new business and adjustment of of the valued customers. Credit rating and
existing policy for making ease to existing business. credit risk grading give the true outlook of
loan applicants. These two are prerequisite
Major Policy Update in 2017 for better portfolio development and
the department has the glory to ensure
Review of Policy Guidelines-Credit Review of the responsibilities of the
Risk Management of Bank Asia Ltd. Chief Risk Officer (CRO) and Chief significant loan customer having credit
Implementation of Bangladesh Credit Officer (CCO) rating and CRG.
Bank’s guidelines on Credit Risk Deferral policy for security/support Shift of Business Delegation
Management (CRM) towards documents To pick up the pace of the proposal
restructuring of credit operation Guidelines for allowing LDBP facility processing while maintaining all due
system of Bank Asia Limited favoring Trading Concern diligence, delegation of business power has
Policy on financing to the Modification of existing SOD (Earnest been entrusted amongst some of the CRM
proprietorship concern alongwith Money) Financing Policy
KYC for proprietorship concern executives by the Management for the first
Modification of existing Commodity
Financing Policy time in Bank Asia Ltd.
Process Automation
To get the leverage of advancement of
Issuance of sanction Information Technology, CRM Department
The department has been performing of Bank Asia Limited has taken sole
Risk Assessment:
sole responsibility for issuance of sanction responsibility of business process
Credit Risk Management Division has
advice combining security details, different automation. With the revelation of
been on its strong footing to take
obligatory covenants, and general effectiveness of the automation process,
calculated risk while doing sustainable
guidelines for loan disbursement. every department has welcomed the move,
business at the same time. Regimented
assessment process as well as robust appreciated it for faster communication,
Credit monitoring gradually embraced the change and
monitoring system has been ensured
Off-sight credit supervision has become adopted it for preserving sanction for
towards streamlining the portfolio.
very essential to check and understand timeless period. Automated departmental
whether the approved loan is performing activity report, account conduct analysis of
up to expectation. CRM Department borrower, ID-wise loan details of borrower,
periodically review bank’s loan portfolio
Risk Assessment in 2 017 which includes but not limited to corporate
and customer performance report have
already been included with a view to
loan account, mid-segment loan account, extending all possible support to the user
1,168
and SME loan account. The department of the system. However, CRM Department
also extends support to the branches having proper instruction and guideline
by helping them develop effective loan of top management is still on the move to
monitoring strategy. make the service worthwhile for the bank.
564

Shift of business delegation

158 from 2016 to 2017
45 40 30 2017
2016
Mid-Enterprise Corporate Small Enterprise Islamic Wing Agricultural Syndication
819
EC/Board
777

1,384
Management
1,082

2,966
HOC 5,111

2,493
CRM
165

Bank Asia Limited

72
Group Finance MIS
With a view to ensuring safe, secure, Financial Statement Monthly business unit wise
Regulatory Reports

62
stable & effective banking, Group Finance of performance tracking 1000+
Bank Asia is operating with utmost efficiency and Monthly profitability analysis- 12
professionalism. Group Finance team oversee all financial Daily position -260
activities of it’s three subsidiary companies. The major
functions of Group Finance
in the year 2017 Tk. 5,000 million
Regulatory Reporting-ISM, FPM,
Issuance of 7 Year Floating & CDLC Reporting
1 year return submitted Rate Non-Convertible
1 year assessment finalized Subordinated Bond-3 40 reports to Bangladesh Bank
2 years High Court writ and of Tk. 5,000 mln Provided daily support to 116
branches for smooth reporting
VAT
reference application filed
1 year writ application win Conducted 2 trainings regarding ISS

Rating
1 year Tribunal filed
1 year VAT audit
finalized with LTU VAT Bank Asia 1st Mutual Fund
Bank Budget CAMELS Rating-half yearly Bank Asia launched an open-end
Employee Fund
Management
147
Branches and
Entity Rating-Yearly
2 Bonds Rating- Yearly
Mutual Fund of Tk. 1,000 million

Total fund Tk. 2,080.9 mln Departments Investment

CL Monitoring Fresh Investment Tk. 264 mln.
Total Income Tk. 231 mln
Awards Identification of Regular CL
280 Letter distribution to
3 for Annual Integrated Report 2016 respective branch for necessary
1 for Sustainability Report 2016 action Interest Rate Monitoring
28 peer banks
Deposit and advance rate analysis
8 Business Conferences Payment T-bill , T-bond rate analysis
Performance analysis in
comparison with the respective Processed Monitoring of Product wise deposit
inclusion & exclusion
budget of the branches, divisions,
departments & units 14,387
9 Publications
bills

(annual-semiannual-quarterly)
Finance

Budget Preparation based on

MIS Financial Control
Supervision of integrated information
commanding areas potentiality
Individual field wise and branch wise
and Variance calculation
monitoring of performance parameters
Monitoring & control
Supervision of Central Database for
Financial Forecast
Financial Analysis
Large Credit MIS-Database
Management
Yearly Tax planning, return submission,
and provision
Attend hearing with tax officials and
Financial and ISM, FPM & CDLC face Tax/VAT audit Payment scrutinizing
Strategic Reporting Monthly VAT/ Quarterly Tax return Monthly operating expenses
MIS database management, system analysis and monitoring
Planning development and maintenance submission
Tax and VAT Deposit to Govt. Cost optimization mechanism
Providing data for preparation of ex-chequer development
Financial Statements, major regulatory
reporting, management reporting and
Financial Capital other divisional reporting
Reporting Planning & Sensitivity, movement and potential Tax & VAT Financial
Management analysis on major business parameters Planning and Control
along with industry growth for Management Process
decision-making and strategy setting

Quarterly, semi-annual and annual Implementation of Basel-III capital Branch wise performance tracking
Financial statements (solo & accord and reporting to Bangladesh with budget
consolidated) Bank and management
Monthly performance review of Capital planning and capital raising Employee
bank’s different business units Capital utilization/ optimization training Fund Investment
Regulatory reporting to Bangladesh to Branches and business units Management
Bank, DSE, SEC, CDBL & others

AIR 2016 Investment and fund management New capital issue (Bond) & Management
Sustainability Report 2016 Facilitate final settlement of operation
Corporate Outlook 2016 Publications Financial statement preparation Facilitate final settlement
Business Review 2017 Feasibility analysis of all investment
Quarterly Financial Statement offers of Bonds, Preference Shares,
SAFA Award – 2nd prize for Corporate Mutual Fund and Pre-IPO private
Governance placement
ICAB National Award-3rd position Own portfolio management/activities
Awards
Certificate of Merit-4th Position for Regular supervision of functions of Bank
Integrated Reporting Asia Securities Ltd., BA Exchange UK and
Best Sustainability Report for Overseas BA Express USA
category

Annual Integrated Report 2017

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 Directors’
Report
Islamic Banking
With the commitment of providing high standard of Shariah complied product & financial
services, Bank Asia Islamic Banking was commenced in 2008. At present, Bank Asia is Key Activities in 2017
operating 5 Islamic Banking Windows in three divisions of the country. Up to December
2017, our deposit reached to Tk.13,863 million, investment (credit) to Tk.11,906.40 million Islamic Banking arranged ‘Islamic
and profit to Tk.416 million with a growth of 27%, 18% and 38% respectively compared to Deposit Campaign 2017’ from all
that in 2016. branches/Islamic Windows of the
Bank.
All of our Islamic Banking activities and products are strictly monitored by the Board and
Management and guided by Shariah Supervisory Committee of the Bank. Our Shariah Conducted extensive marketing
Supervisory Committee consists of 9 members including qualified Faqih (expert on Islamic law), campaign in the surrounding
elite Islamic Scholars and professionals of the country having experience in Islamic Banking. areas of the branches, briefed
Islamic Banking products, services
To calculate profit on Mudaraba deposit, Bank Asia developed a unique profit distribution & policies to the officials of the
module based on Income Sharing Ratio (ISR), the first of its kind in Bangladesh. In this branches to spread out Islamic
module Bank offers an income sharing ratio to the Mudaraba depositors rather than Banking all over the country which
offering a provisional or fixed rate. The actual profit is calculated every month on the basis
resulted in covering online customer
of income earned for the same period. This module has already been recognized as a
base over 15,000 (active account
better Shariah compliant and justified profit distribution module than that of other Islamic
only) with deposit amounting to
Banking operators in the country.
Tk.4,500 million at the year-end
Under the permission of Bangladesh Bank, we are now offering more diversified deposit of 2017.
and investment products to meet the growing needs to the online customers through
all outlets of the bank. To make the venture successful, our Islamic Banking conducted During last year, we have started
several training programs, both on-the-job & off-the-job, to all the concerned officials of the to book Investment client from
bank. We hope that through the expanded network, our Islamic Banking would flourish some of our conventional branches
exponentially. through Online under linked Islamic
Windows.
In November 2017, we have started our Islamic Agent Banking activities through 25 piloting
outlets. Our Islamic Agent Banking is using separate software for conducting its business Islamic Agent banking operations
activities. Till December 2017, we covered 71 Agent points in 12 districts. We are going to have also been started during the
offer our diversified deposit and investment products to the Islamic banking customers year that opens our avenues to
through all of our Agent points covering all districts in 2018. We hope that this would create popularize our Islamic Banking at
stronger brand image of Islamic Banking throughout the country and would contribute the root level of our economy.
more in the overall profitability of the Bank.
Through Hajj services operation,
Islamic Banking extended their
support to Hajj pilgrims in their
pre- registration and final
registration processes.

Islamic 13,863
10,873

Banking 11,906
10,129

(Million Taka)

Deposit
Investment
Profit
6,028

Business Review Meeting of Islamic Banking

5,090

4,539
4,067
3,495

3,477

301

416
155

134
68

2013 2014 2015 2016 2017

Soft Inauguration of Islamic Agent Banking

Bank Asia Limited
74
Directors’
Report
Treasury Operations
In banking business, movement or transformation ASSET LIABILITY MANAGEMENT USD/BDT Tk. 80.55 at May’17 end. Afterwards, the
of the components in the balance sheet is an The year 2017 was a challenge for Treasury as in the upward journey was relatively flatter before it shoot
ongoing process which has a resultant effect on second half, the loan growth did not match with up since early Nov’17 and reached to yearend high
the profitability and overall strength of Bank. inelastic & sticky pricing.Bank successfully maintained USD/BDT Tk. 82.70. However, the effective rate was
Bank Asia Treasury plays an important role all ALM regulatory limits within limits. Throughout higher as fund was traded through cross currencies.
by identifying and measuring those risks and the year, changes in market liquidity and interest Over the year, treasury maintained bank’s net open
minimizing or hedging those risks using various rates may expose bank to the risk of losing money. position and FC liquidity in a prudent manner to
financial tools for stabilizing the balance sheet Asset Liability Management (ALM) has therefore manage exchange rate risk involved in commercial
and maximizing profit for bank. Therefore, in the become a key financial and risk management transactions of on-shore and off-shore banking
process, treasury operates through the integrated discipline that manages both on/off balance sheet units.
efforts of Money, FX, and ALM to achieve the position to maintain a risk reward profile for creating
desired goal. stakeholders’ value.
Falling interest rate spread, popularity of FC loans Treasury portfolios
MONEY MARKET & FIXED INCOME
Surplus liquidity and flat market scenario of early
amongst corporate customers were evident especially holds 25% of Bank’s Balance sheet
in the first half of the year.Afterwards, loans and
2017 moved reverse path since June’17. Due to advance started to grow in the second half but was
well below ADR limit. TREASURY PRIORITIES FOR 2018
Corporate asset liability Islamic division
However, IDR of islami In the context of current market scenario with
SME asset protfolio
Retail asset liability
wing increased above cautious movement of regulators and narrowing
FI/other exposure limit due to comparatively market liquidity along with wider scope of
Market small portfolio; though openness of Bangladesh economy, Treasury is
Liquidity
Risk Risk due to active involvement prepared for big leap forward for risk addressed
in deposit procurement, expansion of it’s business horizon in holistic
it came down below approach through combined effort of Treasury
Other Risks
Equity & - Credit risk the limit. At the end of and all business units. Accordingly the needful
Commodity - Concentration
risk 2017, Bank successfully are sorted out to accomplish the board and
Price risk - AML risk
Operational achieved healthy deposit management vision.
Subsidiaries risk etc.
Offshore Unit
mix by reducing high cost
BA Securities
BA Exchange UK deposit to 48% at year
BA Express USA
end from 51% previously. Popularizing
fixed income
Volatile big corporate investment
deposit is now only amongst
customers
5.50% of total deposit; Diversification Own
of Treasury account FX
top 10 loan account Portfolio trading
BALANCE SHEET RISK OFF BALANCE SHEET holds only10.82% of
total loan. Under the
GROUP TREASURY circumstances, Treasury’s
OPERATIONAL SCOPE 2018
primary objective was Empowering
ALM process
Forward Value added
services &
TRANSFER
to mitigate the balance & procedures new avenues
MM & FIXED PRICING FX CORPORATE FX TRADING sheet gap in cost effective in Bank in corporate
business
manner, maximizing NII,
and managing BASEL Knowledge Enhanced
liquidity standards of LCR, development rapport with
external &
programs &
GLOBAL FX EXTERNAL REGULATORY NSFR, leverage which regulatory internal
stakeholders
& MONEY MARKET ENVIRONTMENT RELATIONSHIP have also become key discipline

concern of management
and regulators around the world. Throughout the
credit growth fueled by import finance in capital year, treasury took proactive approach and remained
machinery, industrial raw materials, agricultural a strong hand of ALCO for asset liability position,
food items contributed in mopping up excess commitment of bank, market liquidity, and transfer
liquidity in the market. Our money market and pricing rate for profit centres. Bank’s Balance sheet is
fixed income desk was very active throughout the now in sustainably strong position and ready for an
year and with the view of falling term structure, excelled take off.
invested fresh fund in primary &secondary market
of bills at laddering methods to maintain SLR and FOREIGN EXCHANGE
LCR at optimum level. Viewing the investment We know Bangladesh Bank prepared a list of top
opportunity in other money market products, 10 import financing bank in the industry during the
treasury extracts advance money from holding first half of FY 2017-18. Bank Asia is one of them.
with some capital gain realization based on Throughout the year, import volume significantly
duration rather waiting for maturity. Treasury surpassed the export and remittance business.
ensured optimum duration of investment and This resulted negative current account balance and
brought the investment position down and depreciation of local currency. The year started
shifting the portfolio to placement with Banks due with USD/BDT Tk.78.70 and gradually moved up to
to demand for money in interbank.
Annual Integrated Report 2017
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 Directors’
Report

International Division
INTERNATIONAL TRADE
International Trade is one of the challenging Import and CENTRAL TRADE SERVICE UNIT (CTSU)
areas of banking operations yielding higher Export CTSU is working as a service centre of the Non-
income for a bank. Globalization has made Million USD AD Branches of the bank for trade services, i.e.
it very dynamic and at the same time very import, export, guarantee, inward and outward
Import
risky to operate. With the growing number remittance, LC advising and transfer and trade
of customers and changes in the pattern of Export advisory services. Day by day it has reached
International Trade, Bank Asia is providing to almost all the Non-AD branches (currently

2,156
the best quality services among the private serving 90 branches) with its quality services

1,824
commercial banks in Bangladesh. Bank Asia and became a comfort centre for the non-AD
possesses experienced professionals having Branches.

1,607

1,457
sound educational background engaged both

1,378

1,286
in AD branches and in Head Office for catering 1,324

1,135
the foreign trade needs of the customers. The Activities in 2017

1,009
Bank has a stretched and expanded global Processed 3,370 nos of Import LC
890
network reaching every corner of the world for (including 319 nos of BTB LCs)
extending all sorts of foreign exchange services amount Tk. 21,736.76 million.
to the customers. Thus the Bank is growing Processed 3,701 nos of Export Bill (local/
steadily and sustainably in the International foreign bills) amount Tk. 6,010.02 million.
Trade arenas over the time. Processed remarkable nos. of inward
remittance (2,780 nos.) which accounts
FOREIGN TRADE AND GUARANTEE Tk.1,318.17 million.
2015
2014

2016

2017
2013

In 2017, the total Import business of the Bank

Outward remittance stands 702 numbers
was USD 2,156 million registering a growth
(including advance TT for Import nos 80)
of 18.21 % over the Import Business of 2016
and total amount Tk. 1,200.60 million.
(USD 1,824 million). Total export business
of the Bank in 2017 was USD 1,457 million Membership Agreement with CCR Manager, Advised and transferred total 4,494 nos.
which was 13.36% higher than that of 2016 a worldwide Fintech Company to manage its of Export LCs.
(USD 1,286 million). Bank Asia has issued credit line in efficient and completive way in Processed & issued 75 nos. of Bank
guarantees against foreign counter guarantees order to provide more value added services to Guarantee worth Tk. 5,761.13 million.
amounting USD 126 million in 2017 favoring its trade clients. Visited 58 Nos of Non-AD clustering
different Government Authorities, Ministries, Branches and their customers/factories
NOSTRO ACCOUNTS across the country for foreign trade
Autonomous Bodies, Corporations, Private
At present, Bank Asia is maintaining 31 nostro business encouragement purpose as per
Companies and Multi National Companies etc.
accounts in major international currencies CTSU’s ‘Branch Visit Program-2017’.
viz.: US Dollar, Pound Sterling, Swiss Franc,
FOREIGN CORRESPONDENTS
Japanese Yen, Australian Dollar, Canadian Plans for 2018
Bank Asia has continuously developed strong
Dollar and Euro & Dollar accounts under Boost up all the non-AD branches for
correspondent relationship with internationally
Asian Clearing Union (ACU), with reputed grabbing more foreign trade business.
reputed banks to facilitate its foreign trade
international banks, ensuring effective foreign
business. As of December 31, 2017 the number Visit all the active clustering branches
currency management as well as timely
of foreign correspondents stood at 727 in 165 and their customers/ factories.
payment of foreign currency commitments.
countries of the world. Organize region-wise workshops/
SWIFT OPERATIONS seminars for the FEX Officials of Non-AD
Our excellent reputation in meeting our
Bank Asia has become a member of SWIFT Branches.
commitment along with our strong financials
in 2000 to ensure smooth, reliable and Adoption of technology and make our
have enabled us in securing credit lines (both
secured financial transactions for its retail and bank paperless/green banking.
funded and non-funded) from International
corporate customers. Over the years, our expert Set up dedicated desks for inward
Finance Corporation (IFC-private sector arm of
SWIFT team has introduced many innovative remittance and FDI.
World Bank Group), Asian Development Bank
features in its existing SWIFT system. In the
and other world renowned DFIs/Banks.
last quarter of 2016, our SWIFT operation
Bank Asia is the first bank in Bangladesh to unit has introduced SWIFT Alliance Message
arrange Supplier’s Credit with Europe based Management 7.1.10 which enables all branches
AKA Bank. Besides, preliminary relationship to be linked up with SWIFT uninterruptedly
building with DEG (Deutsche Investitions- with more than 10,000 Live Institutions in 251 “World’s Best Trade
undEntwicklungsgesellschaft) known as countries around the world. we have installed Finance Provider -2018”
“German Investment and Development nSMART as Middleware Software procured from in country category
Corporation” and renowned development bank Nazdaq to facilitate Sanction Screening, Nostro announced by Global
Reconciliation, interfacing with SWIFT as well as
FMO (Nederlandse Financierings-Maatschappij
different foreign exchange modules of CBS. It is
Finance, a renowned
voor Ontwikkelingslanden N.V.) known as
“Netherlands Development Finance Company” noteworthy to mention that the President and financial magazine
has also been initiated. Managing Director of our bank has been elected
as SWIFT Chairperson in Bangladesh.
In year 2017, Bank Asia has signed a

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ONLINE PAYMENT GATEWAY SERVICES (OBU) in Chittagong Export Processing Zone (CEPZ). OBU acts as a unique solution for the banks around
PROVIDER (OPGSP) the globe to carry out international banking business which involves foreign currency denominated
Freelancers earn foreign currency by exporting assets and liabilities taking the advantages of low or non-existent taxes/levies and higher return on
nonphysical forms of services such as data investment. . In 2017, Off-shore Banking Unit has made a cumulative profit of USD 2.47 million which is
entry, data process, offshore IT services, 8.50% higher than that of 2016 (US$ 2.28 million).
Business Process Outsourcing etc. To meet
the banking needs of these freelancers in Major Automation Works
Bangladesh, Bank Asia has established strategic Bulk Data Process for Bangladesh Bank Online and regulatory monthly reporting
alliance with PAYONEER Inc. USA and Payza,
Automation of Nostro A/c Reconciliation
Canada which are among the largest OPGSPs.
Automation of FEX Business Monitoring
Through this service, freelancers can receive
their earnings very quickly and easily. In 2017, PRC Automation
we have earned remittance of USD 30.62 million EDF Module up gradation
through ‘Payoneer’ &‘Payza’ which is 124.41% Automation of Export Bill Discounting of OBU operations
higher than that of 2016 (USD 13.65 million). Implementation of New Bangladesh Customs Tariff HS Code etc.
Automation for updated Trade Finance Dash Board
OFFSHORE BANKING Automation for Intimation and Notice to branches regarding their overdue liability position etc.
With a view to catering the banking SWIFT modernizations as per International Standard
requirements of non-resident customers, Bank
SWIFT Security Attestation
Asia has established Offshore Banking Unit

Foreign Remittance
Major Accomplishments in 2017

45
Remittance has always been an important Bangladesh Bank Remittance Award 2016
sector for the Bank considering the fact Two remitters sent highest volume of
that makes up the 2nd largest volume of Foreign Remittance through Bank Asia

654
foreign exchange earnings for Bangladesh. in 2016. For that, they were awarded
Since its inception, Foreign Remittance prestigious “Bangladesh Bank Remittance
Department (FRD) showed continuous Award-2016” in 2017 organized by
growth with increased volume over the Bangladesh Bank where Bank Asia was also
years.In 2017, FRD remittance inflow stood praised.
USD 654.48 million against budgeted USD
450 million, 23% higher from previous
year’s volume of USD 532.10 million. Tie up with Continental Exchange
Despite negative growth of the country, Solution (RIA)
FRD registered the positive growth. Executed drawing arrangement with
Round the year, FRD managed to keep the Continental Exchange Solution (RIA),
momentum of inward flow of remittance USA,the 3rd largest Exchange Company for
cross border remittance processing across
going while maintaining profit equation.
the globe. Inward
By end of the year, net profit stood at Remittance 654
Tk. 35 million, way above the budgeted Million USD
figure of Tk. 5.3 million. Recognition from UAE Exchange for 536 552 532
partnership support
Bank Asia’s position in terms of This year, UAE Exchange, parent concern 440
remittance collection among all of Xpress Money (XM), awarded Bank Asia
Banks in Bangladesh for contributing strongly in processing
volume generated by XM.

In 2017 8th Disbursement of remittance through

Agent Banking Network
This year, FRD utilized the strength of 201 3 201 4 201 5 201 6 201 7
In 2016 9 th growing network of Agent Banking of Bank
Asia to reach remittance to remote corners
of the country.

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Retail Banking
Retail Banking Division offers Retail Loans, Credit cards and Retail deposit products for individual customers. The division
focuses on developing innovative financial products and services, giving highest priority on developing technology driven
products for the ease of the customer. The division has taken steps to mobilize low-cost deposits which are keys to offering
lower lending rates. Retail Banking strives to achieve sustainable growth with a vision to become market leader at near future

Consumer Finance

Despite stiff competition in the market, Consumer

Finance under Retail Banking Division achieved a
remarkable success in 2017 with positive growth
of 33.21% compared to 2016. This department
launched tab based solution for faster processing
of loans. Like every year, Consumer Finance
participated in REHAB fair 2017 for the promotion
of Retail Products.
ACHIEVEMENT OF CONSUMER FINANCE IN 2017
Loan portfolio reached BDT 9,425 million in 2017
which is 33.21% higher than 2016
Classification rate came down to 2.97% which is
lowest in last 5 years
Personal loan was redesigned and loan limit
enhanced to cope up with market
Arranged Retail Loan campaign ‘‘Raise the Bar’’
and ‘’Champions Cup’’ for the AROs & Branches
to drive Retail loan business

Performance
Portfolio
Classification

5.33%

4.71%
425
9,

3.54%
3.26%
2.97%
481

075
5,

7,
073
4,
326
3,
2013

2014

2015

2016

2017

Bank Asia staff giving services at REHAB Fair 2017

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Cards
Bank Asia Credit Card Department 7% special discount offer on electronic items in selected renowned brands like
launched its commercial journey in the RANGS, TRANSCOM electronics & RAHIM AFROOZ during Eid
year 2007. Since then the department
has passed couple of successful years
and created a strong position in the
competitive market of the country.
Bank Asia Credit Card is offering various No. of New Card
attractive value added services and Card Portfolio
diversified products for all range of Classification
customers.
11,
309
HIGHLIGHTS OF 2017 13.4%
Operating profit grew by 24% from last
11.6%
year
Overall portfolio outstanding grew by 10.3% 10.5%
28% 7,
165
New card acquisition rate increased by 8.7%
58% from last year 5,
789
Classification rate came down 5,
213
significantly and classified amount
came down in absolute term 3,
495
Cash back campaign on foreign
currency transaction was launched
Buy One Get One (BOGO) offer for 1,
600
952 1,
063 1,
148 1,
252
Platinum credit card holders at
renowned restaurants like Radisson
Blu, Dhaka, Four Points by Sheraton,
Dhaka Regency, Six seasons etc 2013 2014 2015 2016 2017

Internal Control & Compliance

The business of Banking is a diversified and to which the company is exposed or in which Division (ICCD). As per approved risk-based
complex financial activity which involves it is engaged. audit plan, the ICCD completed the audit
high risk. The issue of effective internal and inspection tasks of 119 Branches, 05
control system, corporate governance, Bank Asia Limited has established an Islamic Banking Windows, 30 Corporate
transparency, accountability has become appropriate and effective internal control Office Divisions/Departments including
significant to ensure smooth performance of environment through the Board of subsidiaries and 81 Agent Point Outlets in
the operations of the Bank. Directors, Management, organizational and 2017. Besides, ICT/IS Audits on 14 Branches &
procedural controls and an independent Corporate Office Divisions/Departments and
A sound internal control system plays audit mechanism in order to ensure that the Anti-money Laundering Audits/Inspections
an important role in contributing to the Bank is managed and controlled in a sound on 21 Branches were also conducted.
effectiveness of the banking operations. and prudent manner. The Bank identifies
Internal Control is the process, affected its weakness through internal control The Senior Management Team (SMT) of
by a company’s Board of Directors, system and takes appropriate measures the Bank reviews the overall effectiveness
Management and other personnel, designed to overcome the weaknesses. The Board of the control system of the Bank on a
to provide reasonable assurance regarding of Directors of the Bank has established yearly basis and provides feedback to the
the achievement of objectives in the an Audit Committee to monitor the Board of Directors on the effectiveness
effectiveness and efficiency of operations, effectiveness of internal control system of the of internal control policy, practice and
the reliability of financial reporting and Bank. The Audit Committee meets the senior procedure. Internal control team conducts
compliance with applicable laws, regulations management periodically to discuss the comprehensive internal audit of the internal
and internal policies. Internal Controls are effectiveness of the internal control system of control system of the Bank. The significant
the policies and procedures established the Bank and ensure that the management deficiencies indentified by Internal Control
and implemented alone, or in concert with has taken appropriate actions as per the team are reported to the Audit Committee of
other policies or procedure, to manage and recommendations of the Bangladesh the Board.
control a particular risk or business activity or Bank’s Inspection Team, External Auditors
combination of risks and business activities and the Internal Control and Compliance
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Information and Communication Technology

Technology and digital initiatives remain major concern of information technology to manage the leaders’ databases and
an integral part of the Bank’s strategy driven industries especially for financial development information to produce point
with a core focus on enhancing customer institutes. Securing a financial transaction in time needs of information called “Future
experience and efficiency in processes. is very important for the sustainability of a Leader Application Software”.
The Bank continues to invest in advanced Bank. The image of a bank may be ruined
technologies to provide a secure, superior, due to breach of cyber security. In order to Business Metrics
seamless and uniform service experience to thwart the external and internal threats, we Business Metrics is especially a unique
customers across all channels. The year 2017 have deployed reputed security solutions system among banking systems for loan
was a successful year in light of the following with sophisticated equipment. To buildup tracking to streamline and automate the
achievements: awareness regarding cyber security, we loan application, underwriting, approval
have launched training programs and also process, and associated loan document
Green Datacenter sent emails continuously to make everyone management. Automated pipeline reports
IT Division has established a New Green concerned realize about the significance of track the entire loan approval process
Datacenter and IT infrastructure for adapting cyber security. in master credit files. The system of loan
latest technologies and responding quickly in approval is fully integrated with all CBS
fast changing market scenario for providing Islamic Banking through Agent Banking applications, document preparation systems
uninterrupted services and business Bank Asia is the pioneer of Agent Banking and other applications. This integrated loan
continuity, minimizing risks. in Bangladesh. Presently we have deployed tracking software is revolutionizing the way
Islamic Agent Banking system to provide banks manage loan approval processes and
Oracle Multitenant Database Islamic banking through the Agent Banking workflows.
Bank Asia has implemented Oracle 12c channel. Through this system, clients will
Enterprise Database with Multitenant receive Islamic banking products and CRM Automation
feature which helps us to easily consolidate services specially a/c opening, deposit and We have developed Electronic sanction
multiple databases, without changing any withdrawal. The unbanked may avail Islamic archive for 6 departments; namely: CRM,
applications. This architecture delivers us all banking services from the agent point. CMSE, Islamic Window, SAMD, CFC &
the benefits of managing many databases Agricultural wing. The total number of
like conventional, Islamic, Offshore and Central Day-end sanction archived during 2017 is 14,300.
Agent Banking are brought into as one At Present, Branch End-of-Day processes are Different credit analysis tools have been
container, yet retains the isolation and being run centrally which bring control over developed for credit departments for in-
resource prioritization of separate databases. the branches. Earlier the branches had the depth analysis of Credit performance of the
opportunity to close their branches without customer. Some of the tools are Account
My Family App responding to entries originated from conduct analysis, Id-wise loan details &
ICT Team has undertaken a remarkable other branches including corporate office. customer performance report.
initiative by developing a Standalone Social Moreover, there was no time bound to close
Networking & Office Automation App “My the branch but restriction is imposed as a Foreign Exchange Business Automation
Family” for sharing individual thoughts to result the branch personnel are bound to We have developed a module in the MISDB
make a better tomorrow together. Through complete their function within the stipulated to track foreign exchange business which
this application the users will get all contact time frame. is helping the management for effective,
details of employees which includes mobile monitoring of the business. With the
number, email ID and posting details. OTHER PROJECTS development of new module, the time and
With this app, all office circulars can be resource have been reduced, shortening
uploaded to view all users. Moreover, instant FLDP Application Software correspondence between branches
messaging can also be done through this Banking industry has become very which has enabled the bank for real time
apps. challenging in recent years. Due to rapid monitoring and supervision.
growth of banking operations through
CBS Review and Vulnerability expansion of network, there remains
& Penetration Test leadership gap that constrains success
Ernst & Young (EY) has carried out CBS review and growth of many banks. Contemporary
and VA & PT to check the future compatibility Bank Managers must be prepared to
and strength of the current CBS. Based on grow business, manage loan portfolio,
their recommendation we are gradually professionally guide subordinates
implementing the control function. In and tactfully implement decisions of
addition to this a separate review for mobile management by complying all requirements
apps was also carried out by Risk Associate. of regulatory authorities. Considering this,
we have developed a software system
Cyber Security
The cyber security has recently become the

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Alternative Delivery Channel (ADC)

respective Bank accounts, Debit/Credit ATM Service
cards, EFT etc. on behalf of the Online Through our ATM (Automated Teller
Banking payment. We have implemented Machine) customer can access withdrawal,
the system with KGDCL (Karnaphulí, Gas Balance inquiry and mini statement
Distribution Company Limited) & MetLife facility as well from other bank ATM round
Alico (American Life Insurance Company), the clock 24/7. Our total 63% of cash
ICMAB (Institute of Cost and Management transactions of Bank Asia are done through
Accountants of Bangladesh), ICAB (The its 132 own ATMs and more than 7,500+
Institute of Chartered Accountants shared ATMs all over the country. Our bank
of Bangladesh) for different types of is planning to invest continuously in a bid
payment collection. More than 1.2 million to increase and widen its ATM network
beneficiaries of MetLife Alico is getting
significantly.
facility to pay their different payments
through our branches and Agent Outlets all

30,100
over the country. Now Bank Asia facilitates

29,767
to pay their payables through the internet
based online service and offline payment

25,502
at any Bank Asia Branches/Agent outlets as
well by their Debit/Credit card.
E-commerce & Utility Bill Payment:
Bank Asia has taken more initiative to
expedite ‘e-Commerce’ facility for its
valued customer where Bank plays as
payment partner and Bank account holder
Alternate Delivery Channel (ADC) is a can shop/purchase online through internet
distribution channel strategy used for banking, Debit Card or Credit Card with
delivering financial services without low cost anytime from anywhere. Currently
relying on bank branches. Bank Asia has Bank Asia account holder is facilitating
implemented many alternative delivery e-commerce transaction such as e-ticket ADC
channels such as ATMs, POS devices, Debit purchasing of bus, train, airways, cinemas Transactions
Cards, Internet Banking, Mobile App, SMS & movies, mobile flexi-load, hotel booking, (Million Taka)
Banking, E-GP Service, E-commerce/E- bill payment such as hospital bill payment,
payment solution, Exclusive Outlet to advertisement bill payment, passport
2015

2016

2017

receive Government Passport Fees and fees payment, WASA, DESA, qubee bill
Contact Center service. ADCs ensure payment, computer accessories & service
the smooth flow of regular transactions
related payment, e-shopping etc. by the
and provide banks with higher profits
debit/ credit card and internet banking of Debit Card
with lower operational expenses and
Bank Asia. More than 336,061 VISA debit cards are issued
transaction costs. Through these
channels bank can get faster access to against Savings and Current account to
the competitive market and customers facilitate ATM, POS transactions at all ATMs
can enjoy instant access to all the bank (7,500+) in Bangladesh to access their account
products through the following 24/7 24X7 in 365 days. Card holders are able to
service channels. purchase in VISA enabled POS machines
(35,000+) in various merchant locations all
Online Payment System Cash over Bangladesh. Our Debit Card Operation
or E-Payment Solution Transactions includes new issuance, replacement,
Bank Asia has developed the solution Branch activation and PIN request are automated
which verifies and processes with a
Transactions 37% which reduced debit card issuance time to 2-3
verity of secured transaction instruments ATM days from 7-9 days as well as saved 150,000
to Payment of Member/Student fees Transactions 63% pages and 20,000 courier service delivery cost.
of different institutions, Residential &
Industrial Gas Bill & different payment of
renowned insurance company using their

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Bank Asia SMART APP E-Procurement System

336,061

Bank Asia has a strategy to serve the Bank Asia has been providing banking
280,527

valued customers with modern and services for e-Government Procurement

240,555

innovative banking products and (e-GP) through our Branches. In the

services at affordable cost. Bank Asia has meantime, customers have received
introduced modern technology based around 31,229 services from our bank
banking app “Bank Asia SMART APP” with their utmost satisfaction. This online
which is an integrated internet and mobile platform ensures digitalization of different
banking solution designed to enable to Government procurement project enabling
offer Customers the widest capabilities equal access to the Bidders from all over
across the internet and mobile channels. the country while ensuring efficiency,
Debit Smart Banking offers vast banking services transparency, and accountability in the
Card and manage customer’s accounts, pay public procurement process of the country.
growth bills, change password, balance enquiry, Currently 56 branches have been registered
view statement, fund transfer, EFTN, utility in e-GP system.
2015

2016

2017

bills payment, standing instruction, stop

NATIONAL PAYMENT SWITCH
cheque, view cheque status, mobile talk-
time recharges facilities for all Telco in BANGLADESH (NPSB)
Passport Fees Collection Bangladesh. The Bangladesh Bank has introduced
The Government of the People’s Republic National Payment Switch Bangladesh
of Bangladesh has introduced Online Till end of 2017 total Mobile App user of (NPSB) IB in order to facilitate interbank
Banking Payment systems for MRP & MRV Bank Asia is 17,799 which is increasing electronic payments originating from
Project. For ensuring digitalization of day by day. It is noted that more than different channels like Automated Teller
the government’s online MRP and MRV 1, 13,257 number of transactions where Machines (ATM), Point of Sales (POS),
project, the Bank has opened 18 exclusive BDT amount 425 million (approx) have Internet Banking, Branchless Banking
passport fees collection booths as per done through this Mobile App. and Agent Banking. The main objective
department of immigration & passport of NPSB is to create a common electronic
office instruction under the Ministry of PUSH PULL (SMS) BANKING platform for the switches in Bangladesh.
Home Affairs, GOB. We received more than Short Message Service (SMS) is a popular The system is meant to facilitate the
3, 65,087 number of passport payments communication protocol allowing expansion of the card-based payments
where BDT amount 144 crore (approx) the interchange of short text message and promote real time payment, Utility
from clients through all our branches/ between mobile phone devices. Based on Bill payment, DPS installment, Credit Card
Agent Outlet and ADC channels. this easy and popular technology Bank payment, loan Payment, e-commerce/m-
Asia launched its first generation Mobile commerce, and Customer save cost & time.
Internet Banking Banking facility. Customers can access To facilitate following real time transaction
Bank Asia’s Internet Banking (My Banking) their account using M-banking from all from one Bank to another schedule Bank
is user friendly & Secured. Bank Asia’s mobile phone operator in collaboration of Bangladesh.
internet banking module allow clients to with SSL anytime from anywhere of
get a clear state of their financial position the country. All they need to do is send CONTACT CENTER
and transfer fund to any account within a simple SMS to “6969” and they can Centralized Contact Center solution
the bank as well as other banks anytime instantly access their account, get their is also available through this number
from anywhere in the world. Our clients account information, make fund transfer 09617016205 in addition with the
are also able to enjoy Mobile Talk-Time and pay bills. Bank Asia is also providing existing short code 16205 used round the
recharge facilities for all Telco within transaction alert message on debit clock 24/7 in full fledge to address the
Bangladesh using Internet banking. We transactions to make them aware and to business needs and queries. This number
have ensured international standard of prevent fraudulent transactions. Our 2nd (09617016205) is also available from
security shields for the Internet banking generation mobile banking facility will abroad and overseas customer can get our
to prevent any unauthorized access. enable small savings, withdrawn, utility bill banking service queries (24/7) through this
Internet banking employs encryption payment, foreign and domestic remittance number. Contact Center systems enable
and firewall to protect transactions and to the doorstep of maximum clients at to manage our resources better, serve
queries through internet. To make more minimum cost. clients with greater efficiency which is also
secure, we have already introduced dual helping us to reduce the cost as well as
factor authentication (2FA) through OTP improve the service quality of bank.
for all internet based transactions. Now the
total Internet Banking user of Bank Asia is
65,000

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EBEK Operation & Social Payment

Bank Asia limited is the pioneer in digital getting the services under this project as student stipends and RMG worker wages
financial inclusion in Bangladesh by beneficiaries. Bank Asia provides online payments, food security allowances (cash
implementing Ektee Bari Ektee Khamar banking services through this EBEK project payments), teachers salary etc.
(EBEK), a government project for the to unbanked people with good reputation
poor, ultra-poor and landless people in Bangladesh. Over the time we have made partnership
of Bangladesh focusing on Poverty with Social Welfare Department under
eradication and reducing poverty level It is mentionable that Bank Asia model Ministry of Social Welfare and providing
to 10% within 2021. Government wants of financial inclusion, management, services to Senior Citizen, Widow and
to help the poor people by encouraging financial transitions for EBEK obtained 1st Disabled beneficiaries. We will start full
savings, providing grants, engaging and Prize (E-Business and Financial Inclusion district coverage of Kishoreganj for Safety
monitoring their economic activities category) in Manthan Award in partnership net payment where almost 133,500+
as a group (Samitee) in each village of with World Summit Award, Department beneficiaries will get banking service
Bangladesh. Bank Asia started online of Information Technology, Govt. of India, from their own union. We have another
banking service support for EBEK and various other stakeholders like similar prestigious partnership with UNDP under
beneficiaries from June 2012. Honorable organizations engaged in promoting LGED Ministry named SWAPNO where we
Prime Minister of Bangladesh has digital content inclusiveness in the whole have covered 2 districts and 76 unions
inaugurated the online banking (Bank Asia of South Asian & Asia Pacific nation for for disbursing the daily ‘woman worker
Designed, Developed and Implemented) development. wages payment’ from their union. ‘Cash
services in 2013. By operating EBEK for work’ is another prestigious program
The implementation of EBEK project gave for Bank Asia which is run in partnership
project Bank Asia opened new window us an on hand experience and learning
to intensively work for the rural people, with Ministry of Disaster Management and
which staged us with the development of Relief.
especially for the hardcore, Ultra-poor Agent Banking, marking as the pioneer
and distressed people and make a strong in Bangladesh. With the experience from Moreover, we have started World’s another
relationship with local administration, EBEK operation and Agent Banking, Bank largest Non-Government funded mega
philanthropist, Social and local leaders Asia has become capable enough to project named SHOUHARDO III with CARE
(UP Chairman’s, Upazilla Chairman’s and provide services to all government projects Bangladesh where 168,000 beneficiaries
local elites). like Social Safety net Programs (senior will be receiving banking service from 8
Bank Asia is now operating EBEK Banking citizen allowances, disable allowances, districts.
services in 35 districts encompassing widowed or divorced women allowance,
252 Upazilas and 1,629,286 people are payments of freedom fighters allowance,
wages of road maintenance workers,

Account opening through Digital Systems and allowance Cash disbursement among Land slide affect-
disbursement at Ishwaripur UDC, Shyamnagar, and Satkhira ed people in different Hill tracts district under
UNDP Project by EBEK Operation team

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Agent Banking
Agent banking is comparatively a new in agricultural, SME & Retail category
concept of financial inclusion that help Cheque book/Debit card/Bank POS facilities for Agent Banking customer
the formal banking sector reach out to the E -commerce services through Agent channels in remote Areas
marginalized people of the society. Bank
School Banking facilities for the children in view to make them acquainted with the
Asia earned the glory of being pioneer
banking services and develop the habit of minimizing financial wastages.
in this field to bolster financial inclusion
across the country. Financing in renewable energy sectors as a green banking initiative
Islami Banking for the target population through Agent Outlets
Bank Asia has been investing and
Bank Asia security services through Agent Banking channel
expanding the agent network and
collaborating with NGO, and development Agent Banking service through Post-E-Centers, Union Digital centers,
organizations. Bank Asia has set the Farmer centers, NGO offices and Retail chains
milestone in agent banking, through Bank Asia made a unique Agent banking module with technology based banking concept
registering 300,000 accounts by securing ensuring appropriate security with real time banking for customers. Agent outlets are
a deposit base of Taka 2.65 billion. distinctly branded with bank Asia Agent Banking logo to provide products and services of
During the last two years, Bank Asia Bank Asia. Agent Banking transactions are on real time basis and integrated with banks
has conducted 4.4 million transactions core banking system. Customers get instant information of transaction through mobile
worth Taka 72 billion, and these figures SMS and system generated printed money receipts.
are giving hope to other players in the AGENT BANKING COVERAGE 2017
scheme to pursue a future where agents,
instead of branches, will be the key service Sln Particulars No. of Outlets Coverage
delivery point. Bank Asia has recently 1 Individuals 282
been concentrating on different sectors
2 Passport 16
for facilitating financial inclusion which
includes: 3 Institution 49 62 (District)
4 UDC 1,144 298 (Upazilla)
Insurance for low 5 Post Office 6
income group
Total Outlets 1,497

Agro & Farming

AGENT BANKING PERFORMANCE 2017
Social Safety Net
Value Chain
Payment Beneficiary Account & Deposit status
Sln Account Name No. of Accounts Deposit Volume (Tk.)
1 Savings 251,431 1,338,359,552
School Banking RMG workers
2 Current 17,721 381,073,160
3 DPS Account 29,028 386,227,000
4 TDS 2,411 528,444,881
5 School Banking 7,354 16,886,551
Bank Asia’s Agent Banking facilitates:
6 10 Taka 4,002 3,069,423
Secured banking services to the un-
banked population with modernized Total 311,947 2,654,060,566
banking approach TRANSACTION DETAILS 2017
Inward foreign remittance as the
Sln Transaction Type No. of Transaction Amount (Tk.)
largest Agent Banking channel in
Bangladesh 1 Deposit 950,433 25,751,519,175
Payment facilities for utility bill 2 Withdrawal 641,801 14,569,057,030
payment, passport fee payment and
3 Fund Transfer 598,752 21,905,348,356
other collection services
Social safety net payment by latest 4 Foreign Remittance 277,210 8,626,254,524
innovation through NFC (near field 5 Palli Bidyut 1,547,699 793,000,029
communicator) technology
6 Passport Fee 434,539 1,676,981,580
Lending facilities for rural customer
at the most reasonable interest rate Total 4,450,434 73,322,160,694
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LOAN DETAILS 2017

Sln Loan Type No. of Loan Accounts Disbursed Amount (Tk.) Bank Asia Agent Banking has been
promoted by JICA for introducing
1 SME 1,877 611,157,000 innovative social program in Japanese
2 Agri 209 51,267,000 market.
Accomplished pilot project with
3 Retail 754 264,386,700 Swisscontact and Metlife Foundation
Total 2,840 926,810,700 for financial inclusion of RMG workers.
According to the project 3750 numbers
of RMG workers have received financial
literacy and 650 numbers of accounts
have been opened for RMG workers.
Through A- card, 1,401 numbers of loans
have been disbursed of amount 19.6
Bank Asia and million.
Pran-RFL Group Bank Asia, pioneering in agent banking
joined hands to
facilitate banking
services in Bangladesh and Western
services by setting Union, an international money transfer
up agent banking company, has joined hands and launched an
outlet inside
Pran-RFL’s Daily
innovative service to distribute international
Shopping and Best remittances to the grassroots people across
Buy outlets the country through the Bank’s Agent Banking
digital platform.
Products Services School Banking: In 2017, 4,815 numbers
of accounts (cumulative account no
Current Deposit Account Core Services
7,392) have been registered under school
Savings Bank Account Account Opening
banking platform with a deposit of Tk.
Short Notice Deposit Account Deposit & Withdrawal from account
13,808,126(cumulative deposit volume Tk.
School Banking Solution Fund Transfer within bank and to any bank in
16,836,551).
Smart Junior Saver Bangladesh
Bank Asia signed an agreement with United
School Banking Account Inward Foreign Remittance payment
Purpose funded by Coca Cola Foundation
School Fee Collection Utility Bill Payment
to leverage the impact of Woman Business
Payroll Banking for Teachers Balance Inquiry
Centre (WBC) by linking them to formal
Term Deposits Account Statement (mini)
financial services and empower the woman
Remote Banking (EBEK) Insurance Premium Collection
entrepreneurs towards the sustainability.
10 Tk. Accounts Passport Fee Collection
Access to Information (a2i), Mastercard
Current Account (Astha) SME Loan Processing
and Bank Asia entered into a tripartite
Agricultural Loan Processing
Memorandum of Understanding (MOU), in
Retail Loan Processing
an endeavour to offer financial services to
Repayment of Loan Installment
rural unbanked people of Bangladesh and
Disbursement and Payment of Social Safety Net
make digital payment services accessible to
Salary Disbursement Solution
grassroot people.
A-Card for farmers
Partnership with Bluenumber, SME
Mobile Top Up
Corporation limited, United purpose, PRAN-
Insurance Product Service in life and health category
RFL group, Unnayan Shamonnoy, Pragati Life
Alternative banking facilities: Insurance, Cloudwell for facilitating Agent
Debit/NFC Card Banking service through different channel.
Agent Banking Mobile Apps (SMART Apps) Piloting of Agent Banking services through
Cheque Book the retail store” Daily Shopping” established
Bank POS by Pran-RFL group.
Partnership opportunity with the largest
Collaboration approach for gaining capabilities throughout the year 2017 telecom operators to facilitate Agent banking
Collaboration with UNDP to implement shared Digital Financial Inclusion project with an services through the service outlets of the
initial focus on Safety Net Payment. operators.
Collaboration with Post Office to facilitate Agent Banking Services through 6 e-post centers.

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Payment Service Department (PSD)
Executing all Inter-bank payments smooth BEFTN UNIT:
and fast, yet secured and compliant, Apart from strengthening our Inward Foreign Remittance service, PSD successfully
has been the focus of Payment Service distributed bulk payments as dividend warrants and salary payments on behalf of
Department since inception. Decentralized corporate clients and enlisted companies in capital market. Individuals are also enjoying
Outward and Centralized Inward model BEFTN facility through branches, net-banking and Smart App. BEFTN unit handled
in all units is the key-feature of PSD average 4,860 transactions daily, worth Tk. 30 crore. Upcoming Multi-session will enable
operation. Customized automation, us to credit beneficiary accounts with other banks within same day, while multi-currency
employee-friendly modules and end-to- FC transaction is also under process.
end dual authentication enabled PSD to
keep pace with the evolving challenges of RTGS UNIT:
technical revolution in national banking Bank Asia has the pride to execute first ever RTGS transaction in Bangladesh. Further-
arena in 2017. Inclusion of Agent Banking more, PSD has enabled all branches, Islamic wings and Agent Banking for RTGS. This
and Islamic Windows in all unit operational rapidly growing payment mode has seen daily average transaction over Tk. 20 crore.
updates are result of continuous process
PERFORMANCE OF PAYMENT SERVICE DEPARTMENT
development and intent to extend service
to all Bank Asia customers. 2016 2017 Annual
UNIT Transaction Tk. In Transaction Tk. In Growth
FUNCTIONAL ORGANOGRAM Billion Billion
BACH 1,424,339 926 1,546,324 1,071 16%
BACH BEFTN
BEFTN 928,996 54 1,204,811 74 37%
RTGS 6,046 20 25,026 54 170%
PSD
MICR UNIT:
RTGS MICR
An array of diversified MICR instruments like SB & CD for conventional banking, MSA, AWC
& MSND for Islamic Wing, three types of card cheques, Payment Order and FC Cheque
PSD executed on an average 11,200 for OBU unit is being delivered by PSD. Daily average of delivered instruments stand over
transactions daily, which is 15% higher 25,000 leaves. Also, we have plans to introduce FC Cheque and FC Demand Draft early in
than 2016, daily average volume stands at 2018.
Tk. 4.84 billion which is 17% higher than
previous year.
27.00
BACH UNIT: 25.74
Majority workforce of PSD is involved in Revenue
BACH operation, handling around 6,235 Contribution
transactions daily, worth Tk. 432 crore. (Million Taka)
Accuracy of departmental work is reflected
in PSD issued settlement claims being less 11.23
than 30% against received claims from
other banks. Besides operation, PSD is
capably advancing towards the new era of
BACH-II project of Bangladesh Bank, which
will enable our clients to do FC cheque
transactions through Automated Clearing. 2015 2016 2017

ACHIEVEMENTS TRAINING & DEVELOPMENT STRATEGIC PLANNING

(i) Expansion of RTGS service to all (i) PSD nominated 13 employees to (i) Implementation of BACH-II will be
branches, participate 24 trainings. the prime focus in 2018.
(ii) System (hardware, software & (ii) PSD arranged 3 day-long trainings (ii) Attract customers towards BEFTN
connectivity) readiness for BACH-II for 115 employees of various & RTGS through visibility at all
project upgrade, branches. branches.
(iii) Module customizations executed (iii) PSD provided hands-on training at (iii) Arrange trainings and workshops
for man-power requirement PSD premises to 5 employees of 2 to build awareness and enhance
minimization. branches. knowledge base.

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People Management Division (PMD)
PMD of Bank Asia is working relentlessly to promote innovation, cultural diversity and a congenial working environment to stimulate
organizational sustainability. The goals of 2018 that Bank Asia Limited persevers to achieve are going to be facilitated by PMD committing
to ensure corporate values such as togetherness, mutual respect, integrity etc. PMD focuses on building capabilities using employee
management and set strategies that align with organizational goals for aiming to create Bank Asia as a “preferred employer of the choice”.

Based on the above mentioned systemic perspective, PMD provides Bank Asia Limited with complementary, diverse and innovative
competencies which will be developed by stimulating sustainable individual behavior. PMD persuades employees to move forward to
establish corporate values in terms of customer centricity, quality, responsible citizenship, building the leadership. PMD helps to establish
the Bank Asia culture and climate in which employees have adequate competencies and commitment to serve our customers better.

Functions:
Human Resource Planning Performance Appraisal PMD follows a people friendly approach in its day to
Creating venture teams with a Encouraging Risk taking operation in achieving Bank’s corporate mission and vision.
balanced skill-mix Demanding Innovation The key functional areas of the division are depicted in the
Recruiting the Right People Generating or adopting new ideas
Voluntary Team Assignment Peer Evaluation following diagram:
Frequent Evaluation
Auditing Innovation Process
Planning &
Sourcing
Effective Practices of
Human Resource Management
Reward Systems Organization
Freedom to Research Compensation
Development
Freedom to Fail Human & Benefits
Freedom to form teams Career Management Resource
Freedom to run Businesses Empowering People Management
Balancing Pay and Pride Leading by Example
Dual Career Tracks Continuous Education
Promoting from within
Recognition Rewards Employee
HR
Balancing team and individual rewards Relations &
Operations
Compliance

Strategic Focus:
PMD moves further and pursues a strategic and coherent
approach in managing human resources. In particular,
Principles PMD has established some principles and based on those,
some competencies are cultivated in our employees that
Demonstrate respect is incorporated with regular HR functions increases overall
and recognition of
scope for development. Graphically,
others
the process can be summarized as
Development
Principles Value different points follows:
of view Succession Plan
Principle for Mutual
Recognition Encourage open and Programs for Training
frank communication Recruitment
Mutual Understanding Teamwork
Stimulate participative
Respect to Plurality decision-making and Organization of Lectures
resolution of problems and role play in order to
Trust in teams stimulate understanding
Performance Evaluation and reflection
Integrity
Integrity
Cross Cultural View
Value cooperative
leadership style Reward System

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BANK ASIA INSTITUTE FOR TRAINING Employment
& DEVELOPMENT (BAITD) Transparent and stringent recruitment process,
BAITD is committed to impart training to increase knowledge, develop recognizing and allocating sufficient time for recruitment
skill and bring change in attitude of manpower in individual, task and established confidence in interviewer and interviewee
organizational level. BAITD organizes need-based training program to cope as both the parties have the opportunity to express and
up with changes and introduction of new concept, idea and technology for understand views, ideas, expectations and objective of
achievement of business strategy of Bank Asia Limited. Over the year 2017, each other. Bank Asia generally conducts two types of
BAITD offered 78 trainings for 56,818 MH maneuvering 2,460 personnel recruitment. One is fresh hiring and another is lateral
denoting a growth of 34.48%, 38.69% and 8.51% correspondingly with its hiring. For the fresh hiring, Bank Asia generally engages
facilities of 3 Classrooms with the capacity of 64 participants, 1 dining, 1 highly illustrious consultancy institutes to conduct the
library with more than thousands of collection, 1 computer lab having the assessment professionally. To recruit proven leaders as
capacity of 24 PCs, 2 floors for dormitories with a capacity of 28 people, 1 lateral entrants, Bank Asia sets customized committee
gymnasium and a common room. which is responsible to identify the best among the bests.

BAITD envisages to offer 137 trainings for 75,456 MH to 3,711 personnel Employee Distribution in Branch & Corporate Office
in the year 2018 only at its 75% rated capacity. We have about 6% growth in number of employees from
1,970 in 2016 to 2,087 in 2017.
New Focus by BAITD For 2018
1. Inclusive Banking (Agent Banking) 71% 71%
2. The Winners’ Manual
3. Enhancing Service Quality in Banks
4. Disaster Recovery Management
5. IT Security & Fraud Prevention
in Banks

Employee Reinforcement 29% 29%

In the year 2017, a total of 239 employees vis-a-vis 212 in 2016 were Total Employee
recruited to strengthen the human capital of Bank Asia. New workforce Distribution
supported the continuous expansion of the Bank’s activities. They also
Corporate Office
supported to reduce Domain Gap.
Branch
2017 2016

239
212

145
135
Employee
104
Reinforcement
67 Corporate Office
Branch
Total
2017 2016
Provided 44th foundation training to the officers of Bank Asia

Regional Distribution
Regional Distribution of Employees of Employees
Employees of Bank Asia Limited are deployed in all over
the country depending on the business potentiality as well Dhaka 74%
Chittagong 17%
as banking service scarcity. High concentration has been
Sylhet 3%
given to Dhaka and Chittagong areas since both the regions
Rajshahi 2%
are considered as major business areas where service
Bogra 1%
scarcity still exists. Other regions were also considered Khulna 2%
as important and new workforces were deployed based Rangpur 1%
on need.

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Gender Distribution by Position Age Distribution
In a total of 2,087 employees, overall Bank Asia has a relatively younger segment in its overall employee pool
male female ratio stands at 76:24 and where 58% of the employees fall in 31-40 years age bracket.
non-executive segment has the highest
concentration of female employees.
2% 1% 2%
Male 8%
Female 19% 16%

8%
67%
55% 58%
51-60
76%
41-50
92% 24% 25% 24%
31-40
30 & Below
Male Female Total
24%

Accounts
The Accounts Department of Bank
3#.2,.(/(-)(2,0
Asia is entrusted with the charge !"#$%&'()* 4)-)#5#,)60!"#7-"#'*0 !-95#,)0!"2.#66(,:0
of facilitating financial control, !"##$%&'()*$$*+,%-./012%3($4% <!=3>#=+*$?%!=38
payment processing, regulatory -,'0;22<<##7(,:*0
5($6%5(''*)6"(3,%784%9:%;#3 @))(A36%=3+%@))(A36%
reporting, user access control, @A6?('"H=6"(3%-I/-G.%3($4%J"##
B"6?%(6?*'%!=38$C%-9 02/:G9%3($4%(K%6'=3$=)6"(3
fixed asset schedule management, 8#))#"60(66&#'*% =2&.>#"0?-(,)#,-,.#
continuance of reconciliation, !'=3)?*$DE*F='6;*36$,%0GG
process controlling and so on.
+(,-,.(-/012,)"2/ 3#.2,.(/(-)(2,0-,'0
4&67#,6#012,)"2/ !-95#,)0!"2.#66(,:

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3#-""-,:#'C3#-//2.-)#'*%. G##</903#72")6*0I. 3(:>)6052'(E(#'*0O/:O:%P$*'$
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K('%--O%!'=3)?*$%*=)? H&-")#"/903#72")6*0-2 8(5()0K,>-,.#'*0::G%QE$
3#.)(E(.-)(2,*%784%-I-%;#3

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12,)"2//(,:01>-")0 3#72")(,:
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!'=3)?LB"$*%R&XY%
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?-,-:#5#,) !"2.#660F#J#/275#,)

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Research & Strategy

To guide Bank Asia management with an Banking Industry Analysis of Q3’17 Loss Making Branch Study
unbiased, scientific and objective view of This analysis was mostly a secondary R&SD conducted a research combining both
the market, Research and Strategy Division conclusive research focusing on top-5 banks primary and secondary techniques to identify
(R&SD) was formed in October 2015 by performance vis-a-vis Bank Asia. This report the key reasons for making loss and guide the
on-boarding some of the seasoned banking highlighted scope of improvement for the respective branches in developing strategy to
industry research specialists that is involved bank (global level) at the same time helped to be financially viable in shortest possible time.
with new avenues of business and improving underline strategies for the upcoming years.
existing business and modus operandi. In Branch/Outlet Feasibility Study
the year 2017, R&SD undertook twenty nine Branch Wise Market Aligned Budget R&SD visited twenty two (22) locations to
(29) research projects and produced sixty one R&SD significantly contributed to branch find out business opportunities and barriers
(61) reports covering market scenario, peer budget exercise for the year 2018. and helping the top management in taking
banks analysis, performance diagnosis of By combining the insights from the informed decision to establish branch in most
Bank Asia vis-à-vis major competition to gain aforementioned three (3) studies, R&SD feasible areas.
competitive edge. suggested a SMART and market aligned
budget for all the branches. Call Center Service Quality Assessment
MAJOR RESEARCH PROJECTS IN 2017 of Bank Asia
Study on Micro Finance and Small To track service quality performance including
Command Area wise Key Business Business Models of Competition Banks areas of improvement of Bank Asia’s call
Performance: Bank Asia vis-à-vis and new Business Model for the Retail, center, R&SD conducted a comparative
Major Competition CMSME & Agri and Agent Banking research. Based on the findings several
The objectives of this study were to identify Ban Asia is focused on financial inclusion and immediate, midterm and long term initiatives
key competitions’ different business serving the un-served. On that note, R&SD were taken including different types of
performance, gauge size of the command area has pointed out scope of doing business in trainings.
in terms of different business indicators, track micro, cottage and small business segment.
movement of BA branches market share in the Therefore, two (2) separate researches Division/Department-wise Key
respective command area, identify the areas were conducted on different institutions to Performance Indicators (KPI)
of improvement and provide branch wise explore their modus of operandi, resources, To measure each divisions performance
suggestion. and business performance. Utilizing these quantitatively and further objectively, R&SD
insights, R&SD prepared a business model for conducted a 360 degree research. While
Market Potentiality of Branch, Agent Bank Asia to serve these segments utilizing conducting the research, different local,
Banking and Credit Card its existing channels (both branch and agent multinational and global companies KPI
The objective of conducting market banking). measurement was scrutinized and several
potentiality study was to explore the one to one and mini group discussions with
maximum business opportunity of the the divisional/departmental heads were
respective channels and credit card. conducted to finalize the KPI of respective
department.

Logistics and Support Services

Logistics support is the vital functional MAJOR ACTIVITIES IN 2017 University (BSMMU) under CSR
area of the Bank which builds necessary In 2017, Bank Asia opened up 09 (nine) program.
infrastructure and provides essential new branches and completed the Construction work of 12 storied own
establishment to effectively operate the conversion process of 02 (two) SME Building Complex at Kawranbazar,
Bank in order to achieve the goal. In a Service Centre to full fledge Branch, 01 Dhaka is going on full swing.
banking business environment, integrated (one) Collection Booth and 09 (nine)
logistics support services is a management Construction work of 10 storied own
new ATM booths at different places of Building Complex at Sukrabad, Dhaka
function that provides plan, design the country.
and support of business operation for is going on full swing.
infrastructure development, procurement, Vertical extension of Dormitory
inventory, warehousing, distribution, (2nd floor) for Nurse’s Hostel at
transportation, customer support etc. Bangabandhu Sheikh Mujib Medical

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Anti Money Laundering
Money Laundering is being employed by of new accounts, monitoring transactions, Anti Money Laundering Department (AMLD),
launderers worldwide to conceal the proceeds reporting of Cash Transaction Report (CTR) and Corporate Office always arranges and conducts
earned from criminal activities. Money Suspicious Transactions Report (STR),if any. AML workshops to train all the employees of our
Laundering is an offence in most countries, AMLD, Corporate Office has independent audit Bank and about 98% of total employees (Branch/
including Bangladesh, treat as a top priority to team that conduct audit in all the Branches Corporate Office) obtained AML & CFT related
combat. Although it is not an offence that causes throughout the year to find out lapses/ training. As a result, officials become aware and
death, serious injuries, or violation of freedom irregularities. They will also help the Branches to conscious regarding AML & CFT matters.
of an individual, it enables organized crimes rectify the lapses on the spot, wherein exist. Anti Money Laundering Department conducts
to cause damages to countries’ economy and Chief Anti Money Laundering Compliance Officer Audit & Inspection independently at least once
security. It also hamper social, political, and (CAMLCO) of our Bank has been participating in every year for all the Branches, SME Service
cultural development of societies worldwide. To in the CAMLCO Conference every year which Centers and Islamic Windows of our Bank to
address these emerging challenges, the global would be organized by the Bangladesh Bank. identify lapses/irregularities related to account
community has taken various initiatives against Mr. Mohammad Borhanuddin, Deputy Managing opening, preparation and update of KYC and
Money Laundering and Terrorist Financing. All Director & CAMLCO and Mr. Md. Murshid-Al-Amin, other related issues, preparation of accurate
financial sectors today are investing more in SVP & DCAMLCO participated in the CAMLCO Transaction Profile (TP) which is commensurate
technology and staff development to ensure Conference 2017 at Sylhet. with the account holder’s source of fund
a robust defense. In this connection, Central and to build up the knowledge about AML
Compliance Committee (CCC), Bank Asia Ltd. Bank Asia has been arranging District Level
& CFT issues/matters. Moreover, Anti Money
has developed a software named AML Solution AML related training as lead bank for officials of
Laundering Department has been meeting
with the help of Era Info Tech, a sister concern of all schedule Banks operating in the district(s)
the queries of foreign banks under US Patriot
Bank Asia Ltd. Without checking United Nations selected by Bangladesh Bank since the year
Acts. The Department also responds to the
Security Council Resolutions (UNSCR) lists any 2007. In the year 2017, Bank Asia arranged
account queries of Bangladesh Bank, Income
account cannot be opened and any transaction 03 (three) district level training programs as
Tax Office, National Board of Revenue (NBR),
cannot be conducted. If found anything lead bank at Narayangonj, Munshigonj and
VAT, Central Intelligence Unit, Customs & Bonds
suspicious Branch inform to AMLD immediately. Chittagong.
Commissionerate Office and Anti Corruption
To fulfill the recommendation of Financial Commission(ACC) office.
Action Task Force (FATF) as well as instruction
provided by BFIU, Bangladesh Bank, Bank Asia
has identified, assessed and took effective action
to mitigate their money laundering and terrorist
financing risks. AMLD has assessed ML & TF risk
considering the customers, products, delivery
channels and geographical positions and also
assessed some regulatory risks i.e. risk arises
from non-compliance of AML & CFT measures.
The Chief Anti Money Laundering Compliance
Officer (CAMLCO)and Deputy CAMLCO
at Corporate Office and Branch Anti
Money Laundering Compliance Officers
(BAMLCOs),BAMLO(s) at Branches, who
independently would make the bank compliant
on AML& CFT matters. The regulatory
requirements are being complied with and Bank Asia organized training program as a lead Bank on “Prevention of Money Laundering and Combating Financing on Terrorism”
for officials of all commercial bank’s operating in Chittagong District
the guidelines are being followed for opening

Capital Strengthening
Bank Asia is always committed to ensure million in April 23, 2017. Upon the issuance
sustainability in doing business including of this 7 year floating rate non-convertible
capital adequacy to support healthy subordinated bond as Tier 2 capital of the
growth of business and ensure compliance bank the CRAR (Capital to Risk weighted
with the Basel III capital accord in line Asset Ratio) reached to 14.89% as on
with Bangladesh Bank roadmap. In this December 31, 2017 against required 10%
context, Bank Asia successfully closed which is the highest capital base over the
its third subordinated bond of Tk.5,000 last 5 years.

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Branch Operation
In 2017, 2 (two) new tasks have been added Information Circulars on different regulatory Program 2017 where BOD is assisting in
under Branch Operations Division – i) issues as well as Bank’s internal policy. During choosing the best suitable location for
Monitoring of daily activities of Branches the year 2017, BOD has issued 61 PA numbers new Branch premises. Besides, along with
through IP Camera and ii) Monitoring of from Branch Operations unit. Research & Strategy Division and Retail
employee attendance as well as reporting to From the wing of ‘Central Customer Service Banking, BOD is regularly visiting prospective
senior Management through Bio-attendance & Complaint Management Cell (CCS & CMC)’, locations around the country to choose best
system. BOD has handled 78 complaints during the premises for upcoming Branch opening.
Sanchaypatra related operation has been period, and resolved those very sensibly & Moreover, Branch Operations Division is
increased significantly in 2017. More than efficiently. In this regard BOD has guided the monitoring CASA Account opening trend
Tk. 1,879.36 million worth of different kind branches for the improvement of institutional of the Bank on daily basis and as a result
of Sanchaypatra have been issued through & individual ethical standard, to ensure better a number of Branches have succeeded in
Dhaka based Branches from January 2017 customer service quality and to demonstrate keeping the Low/No cost deposit ratio within
to December 2017 and also realized Tk. customer awareness program. 50%. BOD also monitors the performance
656.10 million from Bangladesh Bank being Under Branch Expansion Program 2016 of loss making Branches and suggests
the encashment proceeds and earn around and 2017, 09 (nine) new Branches has been remedial measures and report to the senior
Tk. 6.29 million as sales commission. Issued opened in 2017 and new 7 (seven) Branches Management.
a total number of 359 Instruction and will be opened Under Branch Expansion

Recovery
With an aim to keep our asset portfolio well The major functions of Special Asset Management Division (SAMD) among others is to ensure
performing, it is essential to ensure recovery of classified (SS/DF/BL) or written off loans and filing of suits, if situation demands. So
recovery of loans & advances within providing all possible support for recovery of such classified (SS/DF/BL) or written off loans
acceptable percentage as well as set applying all possible means including filing of suit is the prime responsibility of the Division.
timeframe. It is only possible if a proper Through vigorous recovery initiatives taken by SAMD with the help of branch and corporate
regimented vigorous recovery drive and office, Bank Asia has notably reduced CL% from 5.41% to 4.38% in 2017.
constant monitoring & follow up of the million taka
borrowing customers both from On-Site and
Sl Particulars Year 2016 Year 2017
Off- Site basis are ensured. It becomes very
hard to run the business when the ultimate 1 Cash Recovery Against Classified Loans during the year 1,860.49 2,504.96
discomfort comes in the form of write-off 2 Cash Recovery from Written off loan during the Year/Period 31.81 34.65
like no collateral, partial/defective collateral,
discontinuation of business, dead/terminal Total 1,892.30 2,539.61
disease etc. adds to non recovery if the loans
& advances turns into a classified (SS/DF/BL).
Suit Position Million Taka
Total
Decree Recovery
Artha Rin Suit Artha Rin Suit Artha Rin Suit Recovery from Recover
obtained & Ex. from N.I Act
filed settled finally running Artha Rin Suit from
Frequency running Case
cases
Running Settled
Nos Value Nos. Value Nos Value Nos Value
Suits Suits
As on
297 13,558.77 80 1,660.00 217 11,898.76 129 5,576.31 77.87 949.03 - 1,026.90
31.12.2016

During 2017 65 11,215.36 21 1,106.62 - - 20 288.78 262.90 9.61 81.89 354,40

As on
362 24,774.13 101 2,766.62 261 22,007.51 135 5,158.47 340.77 958.64 81.89 1,381.30
31.12.2017

Significantly we have achieved sound compliance position in the industry. As per last Bangladesh Bank’s Comprehensive Audit report,
there are no remarkable irregularities with our SAMD’s end.

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RISK BASED CAPITAL social and ecological arena. Bank Asia Bank Asia has effectively managed to
ADEQUACY strongly believes that sustainable growth of reduce energy in its in-house management
The Bank has formed a strong capital base an entity is nothing but a counterfeit ideology utilizing maximum natural day light, energy
by way of various capital enhancement without being communally responsible savings bulbs, green computing based data
initiatives with a view to promote more in business conduct and contribute to the center and installation of solar panel in 11
integrated management of market and society. That is why Bank Asia is always branches; reduced paper use with rapid
counter party credit risk and also operational committed to be a proud development use of automated reporting systems, e-mail
risks. As per Pillar-3 revised RBCA (Risk Based partner of its communities where it belongs and e-statement, SMS Banking, e-transfer,
Capital Adequacy) guidelines of Bangladesh and make the communities grow up through A-card which saved Tk. 5.99 million in 2017;
Bank, all scheduled banks have to publish continuous and balanced CSR activities. resource wastage reduced through careful
their capital adequacy disclosure framework and efficient management of internal
for market participants i.e. stakeholders as a Like previous years, Bank Asia spent an resources. Bank Asia also contributes to CO2
key information about the bank’s Minimum amount of Tk. 183.83 million for several CSR omission eliminating long distance travel
Capital Requirement (MCR) under pillar I of activities this year. A significant amount with the use of electronic communication
Basel III and exposure to various risks related was given to three regular programs - technologies like e-mail, video conferencing
to capital adequacy to meet probable loss of Higher Study Scholarship, infrastructural in communicating and held meeting with the
assets. Details of required disclosures both in development of different institutes and executives of 120 branches (including SME) all
qualitative and quantitative form are laid out support to the flood and cold affected over the country.
in a separate segment. people. Other CSR programs include
environment, sports, health, art & culture, External green banking activities include
CORPORATE GOVERNANCE disaster management. The pace of CSR financing to infrastructural development
Corporate governance is a concept referring contribution is expected to accelerate in of renewal energy generation and carbon
to the ideal mode of ensuring firm’s the future with long term vision. In depth omission projects like import and install
accountability to its various stakeholders CSR activities of the bank are available of solar home systems, CNG conversion
through a strict system of internal controls in Corporate Social Responsibility (CSR) projects, bio-gas, Urban Building Safety
and procedures, guided by the hon’ble Board segment. Project, Effluent Treatment Plant (ETP) &
of Directors and alligned to related rules and Hybrid Hoffman Kiln (HHK) in brick fields;
regulations of various regulatory bodies. GREEN BANKING avoiding financing to environmentally
The corporate governance of Bank Asia sets Bank Asia believes in eco-friendly and harmful projects like tobacco related
top priorities in the fairness, transparency, socially responsible banking system which business. By principles, Bank Asia thoroughly
accountability and responsibility on its top drives the whole nation towards a healthy considers the effect of its financed projects
most priority. Our disclosures on status of environment. In order to protect/balance the on environment. In 2017, the Bank disbursed
compliance on BSEC and Bangladesh Bank environment, Bank Asia is spreading its wings Tk. 37.54 million to Winter Dress Ltd. which
guidelines demonstrate strong compliance by introducing both in-house and external involves in treatment of liquid waste, Tk.
culture of the Bank. In recognition of that Bank Green activities towards supporting Green 1,090 million funded limit and Tk. 588
Asia has garnered SAFA Best Presented Annual Economy. non-funded limit to Triple Apparels Limited
Report Awards 2016, First Runner Up under which has LEED Certificate (a certification by
SAARC Anniversary Awards for Corporate Energy efficient in-house Management USGBC for environment friendly construction
Governance Disclosures. Bank Asia was through reduction of energy and resources as well as efficient use of energy and
awarded Third prize for Best Presented consumption such as reduction of use water). Bank Asia also financed of Euro
Annual Reports for its Annual Integrated of paper, maximum use of day light and 5.17 million under the Export Credit Agency
Report 2016 under Corporate Governance environment friendly business activities (ECA) to Engreen Sharishabari Solar Plant
Disclosures. The details of corporate by financing to renewable energy and Ltd. for establishing a 3-MWp (megawatt-
governance practice of Bank Asia are carbon offset projects, brick fields using peak) Grid-Tied SPV (solar photovoltaic)
discussed in a separate segment ‘Corporate Hybrid Hoffman Kiln (HHK) and tunnel independent power plant on 8.23 acres of
Governance’. Kiln Technology, CNG conversion projects, land at Sharishabari of Jamalpur. Moreover,
effluent treatment plant etc. are of prime Bank Asia draws attention and creates
CORPORATE SOCIAL focus of the Bank. For a sustainable economy awareness of its stakeholders on different
RESPONSIBILITIES Bank Asia plays crucial role in financing environmental issues each year through its
Bank Asia always streamlines its efforts to environment friendly projects led by green Sustainability Report. There are other green
look beyond short-term quantitative gains banking that believes in social responsibility. banking activities played by the bank which
and concentrates on issues that make the Bank Asia practices responsible and careful was covered in detailed in environmental
institution socially responsible. It gives all banking system focusing on a safe and sound performance segment.
out efforts towards sustainable balanced environment which is a must for healthy
growth. We are committed to social and existence of human beings in the globe.
environmental well being and strive to ensure
sustainable balanced growth in economic,

Annual Integrated Report 2017

93
 Directors’
Report

Bank Asia Securities Limited (BASL)

Bank Asia Securities Limited (BASL), a identified throughout the years. Besides, throughout the year. Total Operating profit
majority owned subsidiary company of unusual price hike of ‘Z’ category shares, stood at Tk. 254.73 million as on December
Bank Asia Limited started it independent manipulative stock trading of new listed 31, 2017. Number of total active clients
commercial operation from April 17, 2011 stocks and lack of enlistment of strong large reached at 6,113 in December 2017, which
having 07 outlets across the country with a capitalized and multinational companies were 5,197 in December 2016 representing
paid up capital of Tk. 2,000.00 million. were the major concerns of the market. a growth of 17.6%. Margin loan outstanding
Bangladesh Capital Market witnessed The prime index of the Dhaka Stock stood at Tk. 5,074.11 million in December
a bullish trend throughout the year in Exchange, DSEX started the year with 2017, which was Tk. 5,380.14 million in
2017. The trend of the bull market revived 5,036.05 points on January and ended the December 2016.
investors’ confidence and derived from year with 6,244.52 points with increase of
strong year-end earnings, higher dividends 1208.4 point. Total Market capitalization of Total Active Clients
coupled with positive economic outlook. Dhaka Stock Exchange stood at Tk. 4,228.94
Both institutional and individual investors billion as on December 31, 2017, from Tk. 6 ,113
were seen active in injecting fresh funds in 3,412.44 billion as on December 31, 2016 5 ,197
the market because of low returns from the representing a growth of 24.1%. The daily 4 ,810
deposits of banks during the period. The average turnover in 2017 was Tk. 8,748.38
bullish market helped investors in recovering million against Tk. 4,944.28 million in 2016.
the losses they had incurred during the Foreign investors’ turnover on the DSE also
market crash of 2010 and 2011 that was increased by 30.48% to total at Tk. 114,476.3
continued by around three years. The market million in 2017 compared with that of Tk.
surge was mainly lead by the banking stocks 87,733 million in 2016.
with an average 51% upside but the banks’ BASL has been continuing the position
poor financial health amid irregularities and of DSE’s Top-20 in terms of daily turnover
growing number of default loans was well 2015 2016 2017

BA Exchange Company (UK) Limited

Banks in the UK have been under heavy Despite the different setbacks in the whole With the prudent directives of the Board and
scrutiny by regulators. Rightly or wrongly sector in the last few years, we have managed Management, hard work of our counter staff,
they seem to have taken a blanket approach to recover our business from the severe unique marketing, improved service process
on this and have focused on cash based downfall in the year 2017. We had the best making us one of the most preferred choices
businesses and Money Service Business year so far since our operation in the UK of remittance partner by expatriates living
(“MSB”) where they perceive the sector in having number of transaction increased by and studying in the UK. We are also going to
general to be poor. They have not bothered 27.42% & volume 23%. introduce soon our mobile apps to make the
to look at individual case by case scenario transfer even convenient. So our continuous
unless it is a household name such as The main challenge we face now is retaining endeavor will be deployed to improve service
Western Union or MoneyGram. They have business with competitive pricing. Brexit excellence further and convenience of our
therefore ceased provision of services to our caused the Sterling to fall sharply against customers.
sector. Due to this approach the MSBs have Dollar by almost 20% which is slightly
4,228

been severely suffering to keep the channel recovered by the end of the year but inflation
2016 939

open. However, few other bank-owned is increasing since then and will continue
companies have become the agent throughout the year ahead. So we need to be
of large MSBs. pro-active rather than reactive.
Profit/Loss
2017
2015

BA Exchange predicted that the future of The ATM installed at BA Exchange premises (in £)
money transfer would be cashless gradually for our customers since February 2015 is
and therefore we introduced Online bringing in a steady revenue and we are in
Remittance Module (ORM) in March 2017 so pro-tracked talks with a third party in relation
that people can send money online from to a potential new business stream.
anywhere within the UK from the comfort
(73,710)

of their home or on the go and can pay by The agreement with Western Union is working
their card. Apart from that the merchant well in sending money globally and will bring
facilities are working well and we now have in non-Bengalis and we are also attracting the
approx. split of 50:50 by value, between cash sale of Foreign Currency, though this is very
and merchant takings, which should help to passive.
reduce our risk.

Bank Asia Limited

94
Directors’
Report

BA Express USA Inc.

BA Express USA Inc. was officially launched FUTURE PLANS ADDITIONAL STATEMENTS
in 2014. Now it has two branches, one Increase selling Volume Additional statements in the Directors’
in New York and the other in Brooklyn. Reduce operating expenditure Report prepared under section 184 of the
Through these 2 branches, BA Express Generate minimum critical volume (i.e. Companies Act, 1994 (Act No. XVIII of 1994)
USA Inc.serves its customers by remitting USD 3.41 million monthly) to reach ‘no is described in a separate segment.
their hard earned money throughout loss no income’ state
the year. To provide easy, low-cost and Expansion of collection and OUR GRATITUDE AND THANKS
convenient remittance opportunity for distribution channels We want to continue on doing the best
the Bangladeshi community residing in Introduce FinTech company based and ensure prolonged development in
New York BA Express received remittance payments to accelerate transaction the economy, society, lifestyle and thus
of USD. 36.26 million in volume through pace and increase overall volume every sphere of our country in line with
73,671 number of invoices in 2017. our vision. Our sustainable banking
Operating loss stood at USD (124,639) in EVALUATION OF QUARTERLY REPORTS operation is attributed to our prudent
2017 which was USD (205,967) in 2016. The Board of the Directors evaluates Board of Directors, effective Management,
the quarterly reports every year. The enthusiastic and skillful employees and
Remittance Management prepares the financials and trust bestowed upon us by our valuable
Year Invoice submits to the Board for approval. The clients and shareholders. We would like
(Million USD)
Board examines the financials with due to convey our earnest gratitude to the
2015 64,973 34.44 Bangladesh Bank, Ministry of Finance,
diligence in order to ensure the financial
2016 63,944 29.49 statements are fairly stated. Thereafter Bangladesh Securities and Exchange
2017 73,671 36.26 the Board approves the financials with Commission (BSEC), National Board of
recommendation in various aspects such Revenue (NBR), Government and other
as reducing non-performing loan, increase concerned authorities for their guidance,
INITIATIVES IN 2017 of profitability and other key issues for valuable suggestion and continuous
Established agency arrangements with improvement of financial performance. support. Our Board of Directors,
34 agents across New York Management and staffs of the bank are
Incorporated new agents to increase devoted to achieve the priceless goals of
remittance volume the bank and to maximize shareholders
value through combined efforts and
strengths.

On behalf of the Board of Directors

Major Gen. Mohammad Matiur Rahman (retd.) Ms. Romana Rouf Chowdhury
Director Director

Annual Integrated Report 2017

95
 risk
analysis and
integrated
strategy backed
business model
corporate
governance,
compliance and
remuneration
report
financial
statements

Bank Asia Limited

96
 Our Approach to
INTEGRATED
REPORT
An Integrated Report (IR) is a concise
communication about how an
organization’s strategy, governance,
performance and prospects lead to the
creation of value over the short, medium
and long term and aims to cover a vast area
of the business activities in sustainability
framework. Unlike Annual Report that merely
deals with past information IR reflects on how
nonfinancial considerations have influenced on
financial decisions as well as overall strategy
of the business over a period of time.

Our IR gives a clear indication of our business

model, strategic focus, resource allocation and
future outlook to help the stakeholders evaluate
the Bank’s intrinsic value creation capability. In our
fifth Integrated Report to the Bank’s stakeholders we
focused more on risk and opportunities through risk
management disclosures, corporate governance, and
sustainable banking initiatives with a view to highlight
Bank’s overall performances of 2017 and discuss the
key factors that are material to its present and future
value creation. We identify that we must effectively
manage our resources and relationships to ensure
attractive returns on our investment over the long term.
We have also tried to keep this report concise, consistent
and complete, including all material matters, both positive
and negative in a fair way and without material inaccuracy.

Since inception, Bank Asia has been directed with the vision
of making a poverty free Bangladesh. Our mission, goals are
set based on the vision and continuously driving for the well
being of the people. Keeping this in mind, we are expanding the
base of our sustainability business frame
work through contributing in building the
society, strengthening governance issues,
value creation for our shareholders and
responsible business complying environmental
issues. Stakeholders have become
more concerned about the company’s activities
whether it is earning by doing ethical business.
sustainability report
By the journey of preparation each year IR gives us new covering economic,
insight on how to improve the report for the stakeholders environmental,
and tried to make it more informative and accessible. Here
we welcome any feedback on its ideas, design, content and
human resource &
comments can be directed to social aspects
arteam. ba@bankasia-bd.com

Annual Integrated Report 2017

97
 Deposit and
Advances Strategies
Industry Advance
Industry Advances
Industry Growth % DEPOSITS STRATEGIES
Million Taka Taping different government agencies
e.g. Foreign Missions, Roads & Highway,
LGED, Bangladesh Bridge Authority
etc, and also other different corporate
houses, e.g. Foreign Air Lines, Telecom
19%
10,020,051 17%

companies etc. and maintaining regular

intense social interaction with different
15%

segments of the society.

14%
14%

8,564,146

Cross Selling of different products

7,225,471
4,821,218 11%

including retail to corporate customers. Backward linkage industries to be

6,256,340
5,481,388

targeted which will provide a good

Exploiting the growing rural deposit
source of SME business through
basket by setting- up smaller size low
availing the benefit of supply chain
cost rural branches and establishment
management.
of most important channels like EBEK
(Ektee Bari Ektee Khamar), Agent More priority to export oriented
Banking etc. industries to help increase forex flow,
2018 (E)
2014
2015

2017
2013

2016

earn through multi channel which will

Offering cash management services, i.e.
help increase no cost fund of the Bank.
collection of institutional accounts and
Industry Deposit effective use of EFTN service to ensure Special attention will be given to
Total Deposit fast & secure cash service. expand SME credit portfolio to achieve
Growth % relatively higher yields and also to
Rigorous CASA campaign, Hajj deposits
reduce adverse effects of large volume
campaign and so on.
16 % defaults.
Exploit mobile banking services to tap
13% Risk Management techniques should
huge low ticket domestic remittance
11%
10%

apply to ensure strong internal control

and mobile wallet to facilitate retail
13%

13%

over business operation.

shopping.
10,280,590

Identifying probable problem accounts

9,261,793

ADVANCES STRATEGIES through Early Warning System (‘EWS’)

8,402,682

New emerging sectors like power, and taking appropriate care of those
7,450,231

ship building, ship breaking, jute yarn, and formulating exit plan,
6,588,516

ceramic, pharmaceuticals industry etc. where necessary.

5,807,093

to be more focused. Disbursement of loan to high yield

Existing thrust sectors like agro based generating business segments
industries, leather, frozen food, textile commensurate with calculative risk and
2018 (E)

industry to be more focused. maintain high quality asset portfolio.

2013
2014
2015
2016
2017

Bank Asia Bank Asia

Loans & Advances Deposit
Loans & Advances Deposits 37,959
Growth Amt
Growth Amt 234,955
197,504 31,533 207,041 245,000
28,958
163,610 37,451
29,236 191,273
23,428
136,396 140,869
116,809 33,894 110,062
10,293 169,827
104,911 27,213 95,131
92,329
21,445
82,820 12,431 133,489
11,518 12,582 19,587
15,769
9,509 12,398 14,931
3,316 11,898
79,504 8,765
86,366 7,380
50,268 42,435
54,833
39,975

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 (E)
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018(E)
Bank Asia Limited
98
Import and
Export Strategies
Country Position Vs
Bank Asia Position
Percentage %

23.02%
20.72%
18.53%

18.20%
15.79%

13.33%
10.22%
8.24%

4.51%

4.84%
4.42%

4.05%

3.91%
3.69%
3.01%
2.24%
2.28%

2.31%
2.26%

-0.56%
Deposit Advances Import Export Remittance

Country growth (Dec-17 over Dec-16)

Bank Asia growth (Dec-17 over Dec-16)
Bank Asia Market Share-Dec-17
Bank Asia Market Share-Dec-16

IMPORT & EXPORT STRATEGIES

Arranging credit lines for foreign currency from international agencies to facilitate international trade business
particularly import clients at a competitive rate and the country as a whole will get benefit of building foreign
exchange reserve.
Marketing for not only established business houses but also the potential clients having strong entrepreneurship
spirit to grow.
Garments sector will be more focused where tested and potential clients will be in the portfolio basket under the
regime of calculative risk return trade-off.
Emerging ship building and ship breaking sectors will explore new opportunities which the Bank will tap for increas-
ing international trade.
Industries having backward linkage will yield better opportunity and reduce risk exposure.
Focusing on service export sectors like IT and Education. Bank Asia
Export 132,715
Bank Asia 26,329
Import
Export 118,172
Growth Amount
Import 103,139
Growth Amount 17,513
220,268 89,275
Million Taka
43,040
181,468 77,647
15,033 14,543
38,800 71,969
148,724 5,798 30,953 13,864
32,743
16,393 106,746 129,930 4,738 11,628
99,414 110,738 19,738 66,478
74,795 5,678
11,767 5,490
110,418 18,794
7,332 57,282
67,378
50,985 25,155
3,992
(546)
(8,317)
(11,004)
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 (E) 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 E

Annual Integrated Report 2017

99
 Future
Orientation
The year 2018 would be characterized of our export. European Union (EU), a to national grid by 2018 will see a rise
by ample opportunities and challenges major RMG importer of Bangladesh, in national productivity and rise in
ahead. Bank will set strategies to over- is continuously putting pressure demand for credit.
come the hurdles and make the best use of on RMG manufacturers on different 4. Envisioned Padma Bridge is
opportunities to be in winning position. issues like work environment, child anticipated to be completed at the end
labor, minimum wage etc. Risk on of 2018 that will hook up 21 southern
CHALLENGES
cancelation of GSP for these reasons districts of Bangladesh to the capital
1. Overall spread in banking industry
would hamper our export growth. Dhaka resulting in the lofty growth of
narrowed down to 4.72% in 2017 from
9. Inward remittance of Bangladesh saw economic activities and in so doing
4.85% in the preceding year and this
the six-year lowest in last FY16-17 that increased demand for investment.
would continue in 2018 for which the
has a little growth in running fiscal year. 5. Completion of Dhaka-Chittagong
profitability of the bank may reduce.
This sluggish flow of remittance can be four-lane project at the mid of 2017
2. Bangladesh has been ranked 183rd
an obstacle to achieve projected GDP has abridged transportation time of
according to ‘Doing Business Report’
growth 7.4% in FY17-18. export-import goods appreciably and
conducted by the World Bank in
10. Incessant CRAR deficiency of State- so transportation cost and lead time
2017 compared to 177th in 2016. This
owned Banks has made banking which push up export-import oriented
indicates business environment and
sector riskier, annihilates depositors’ manufacturers to the extension of their
facilities deteriorate in Bangladesh
confidence, shrinks deposits and businesses that calls for increased
compared to previous year that may
creates liquidity crisis. Government demand for financial assistance of
create a negative impact on both
subsidiary to these banks with public bank.
local and foreign investors to invest in
revenue is a trade-off between 6. Bank Asia’s ongoing financial inclusion
Bangladesh.
economic development and loss program like “EBEK’’ & “Agent Banking”
3. The upcoming National Election
compensation. can create generous opportunities that
expected to be held on the early 2019
11. Growing trend of non-performing loan present in the geographically dispersed
which may raise the risk of political
(NPL) in recent couple of years backed segment of Bangladesh.
unrest situation that eventually would
by political patronage, nepotism of 7. Agent banking has registered an
impact the investment climate of the
internal people and board members is outstanding growth in recent years
country.
a big threat to the sustainability of the which covers unbanked people in
4. Trade Deficit has been alarmingly
banking sector in Bangladesh. banking sector. Such a good sign
rising in 2017 hitting USD 9.47 billion,
12. Mammoth capital expenditure in will boost up economic activates
the highest in last 5 years, putting a
gigantic Padma Bridge without external contributed by people who remained
pressure on the foreign reserve that
finance and other big projects like the unbanked for decades.
would cause further devaluation of
Metro Rail project, Dhaka Elevated 8. Recent outbound in communication
local currency and thereby increase the
Express, Rooppur Nuclear Power Plant and information technology like
import cost.
with partial external financing can smartphone and availability of internet
5. With higher demand placed for credit,
reduce national savings and reserve facility makes the banking sector
demand for deposits is spiraling up
fund which may lead an adverse more attractive. Bank Asia aligns with
indicating a dearth in the availability
economic situation. advanced technologies introducing
in supply of deposits, resulting higher
SMART Banking, Diganto, My Family
borrowing rate, marking higher costs
OPPORTUNITIES app, Online Credit Approval System
for Banks.
1. Bangladesh has registered as the 5th (OCAS), Online CIB which will facilitate
6. Over dependence on fuel based
largest Fish producer in the world quick and uninterrupted automated
electricity generation might see a rise
by producing 2.1 million tons of customer servicing.
in the cost of electricity marking a
fishes in 2017 marking a remarkable 9. GDP of Bangladesh saw an expansion
pumped up cost budget that will make
growth in the production of fisheries of 7.28% in FY16-17 and has been
business environment a bit stiffened.
and expansion of agricultural stance revised with a range of 7.80% to 8.0%
7. Influx of roughly one million Rohingya
marking a promising move for for future years which will open up
from Arakan of Myanmar has twisted
investment and development. more economic opportunities in future.
a severe problem for Bangladesh
putting an upward demand for import 2. The Executive Committee of the
of foodstuffs, involvement in different National Economic Council (ECNEC)
anti-social activities to fulfill basic approved 13 projects worth Taka
needs, disturbing social peace being 12,415.79 crore marking a prospect
spread out over the country. for investment opportunities and
8. RMG has been contributing a lot to growth in business through improved
the economy of Bangladesh for the communication and commutation.
last four decades, approximately 80% 3. Addition of 4,676 megawatt electricity

Bank Asia Limited

100
Strategic
Focus
Improved performance through seamlessly with a view to managing core mapping bank’s carbon foot print,
capacity building and employee risks of the Bank, optimizing the revenue efficient energy use, environment
productivity revitalizing efficient service streams (profitability), expediting credit friendly projects like ETP, Zigzag and
delivery, organizational effectiveness, approval process that will help achieve HHK technology, plants nursery, biogas
strong public relations and customer goals, make smart business decisions, and horticulture projects etc.
satisfaction equipping employees overcome work place challenges and
with expertise, necessary skills and PROMOTING FINANCIAL INCLUSION
learn new skills.
knowledge properly addressing One of the strategic priorities of Bank
employee motivation, satisfaction, CUSTOMER SATISFACTION Asia is to promote financial inclusion
health and morale to improve employee Bank Asia is sincere to create higher for combating poverty which the
productivity altogether culminate customer satisfaction and loyalty by Bank firmly believes to achieve by its
performance of the Bank. its brand enhancement programs, deposit services, agricultural credit
personalizing banking, creating program, small enterprise financing for
BUSINESS KPI’S brand ambassadors, Online product productive new off farm employment
Bank Asia has chosen some financial innovation, measure and reduce of ‘missing middle’, Solar home system
and non-financial key performance customer effort, creating differentiated projects with NGO-MFI partners, foreign
indicators (KPIs) that are important customer value proposition, conducting remittance of poor migrant workers
for its future success. Financial KPIs: customer satisfaction survey for channeling through partner MFIs,
Proportion of SME portfolio, loan loss identifying client expectations as well domestic remittance distribution,
rate, Cost Management, Net-operating necessary actions to be taken for service mobile operation through mobile
Income Growth, Operating Income improvement. banking, EBEK project for the ultra-
Mix, Cost to Income, Shareholder poor people and agent banking for the
GOING GREEN IN THE
Returns. Non-Financial KPIs: Employee underserved population.
FUTURE OF BANKING
engagement, Brand perception,
Bank Asia firmly promotes green GIVING BACK
customer satisfaction, IT performance
banking to reach its long term strategic Bank Asia believes in giving back
&system reliability, number of CASA
objective to be a green, triple bottom to the community and it will
customers, proportion of non-interest
line bank where every decision will continue to promote education,
income, distribution outlet outside
be taken with both financial and fulfill its commitment to community
Bank’s own netw environmental considerations in mind. health, disaster management,
The Bank’s green banking initiatives clean environment, sports, art and
BUSINESS KRI’S
includes Online & paperless banking, culture.
Bank Asia has chosen some forward
reduction of green house gas emission,
looking key risk indicators (KRIs) to
focus on emerging risk to recover,
improve or maintain its performance.
Bank Asia is committed to create Human Office equipment Floor space
Resource allocation area
good risk culture that includes clear Resources (tk.) (sq. ft.)
guidelines,clear responsibilities and risk Business Head 1 570,290.45 329.53
awareness programs to identify. KRIs: Branch Banking Services 1,480 844,029,860.29 487,712
Emerging impediments to financial Chairman, MD's & DMD's
performance, regulatory status, Asset 6 3,421,742.68 1,977.21
Secretariat
growth outpacing capital growth,
HR Planning & Manning 32 18,249,294.28 10,545.12
increase in SMA in the bank’s geographic
location or customer cluster, increase in Operations Support 77 43,912,364.35 25,374.19
approvals of credit proposal exceptions, Finance Function 15 8,554,356.69 4,943.02
increase in percentage of interest only Treasury Function 15 8,554,356.69 4,943.02
loans to total loans, significant changes
Loan processing & supervision 250 142,572,611.54 82,383.72
in funding mix period to period.
International Operation 60 34,217,426.77 19,772.09
MENTORSHIP PROGRAM FOR Information Systems 108 61,591,368.18 35,589.77
BRANCHES Board Secretariat 2 1,140,580.89 659.07
Bank Asia implemented zonal 41 23,381,908.29 13,510.93
Internal Audit & Compliance
mentorship concept involving Senior
Total 2,087 1,190,196,161.10 687,739.33
Management to monitor branches

Annual Integrated Report 2017

101
 Our Activities and Values
EXTERNAL
FACTORS

Value Creation Activities Actively make progress against our By offering unique products to our
strategic priorities to achieve our clients to support their business
To support economic growth, through vision requirements, including commodity,
credit, investment capital, trade credit, foreign trade, debt and equity
finance and infrastructure financing Engage with stakeholders and instruments
we facilitate allocation of capital responsive to their concerns
VALUES THAT MAKES US STRONGER
Facilitate access to financial Entrench our code of ethics and
services, enabling socioeconomic values Efficient, skilled and experienced
development and personal wealth employees
Reduce our operational impacts and
creation, which are relevant to the Dedicated customer service
promote positive change
markets in which we operate
Proactive
Be an active corporate entity
Provide effective markets to
Team Work
encourage banking activities of BUSINESS ACTIVITY
customers and cli-ents through secure Commitment to the Shareholders
and reliable transactional systems By usingdeposited money placed by
customers and other surplus entity Integrity and accountability
and processes
to facilitate lending to the customers Highly efficient management
Enable financial protection and with proper utilization of existing
diversification through risk transfer Sustainable commitment
capital by minimizing risk through to the society
approved regulatory environment
To ensure customers have safe as well
as convenient access to their savings By accelerating investment and build BANK ASIA’S VALUE
and funds we deploy and maintain up capital through offering quality CREATION ACTIVITIES
the integrity of banking infrastructure banking facilities and knowledge- The outcomes of the roles we play in the
based services to our customers course of our business activities, and
Build and maintain a good
governance framework to protect and By maintaining economic stability the ways to ensure that value creation is
enrich value creation through proper control of money maintained, are illustrated below:
market

Growth of Tax
Amount Reinvestment
Employees (Taka in million)
(Taka in million)
6% 2017 4,678 2017
4,408 201 7
7% 2016 4,180 2016
4,349 201 6
4% 2015 3,197 2015
3,901 201 5

We recruit talented people By paying taxes, we Wealth is reinvested for

and train them so that they contribute directly to further growth of our
can increase the company’s governments to build business, which ultimately
value by giving their best stronger economies benefit our stakeholders
effort and labor.

Bank Asia Limited

102
 THE VALUE WE HAVE CREATED Entrench our code of ethics and values year. Using the available stocks of capital,
To support economic growth, through Reduce our operational impacts and we create value through our integrity
credit, investment capital, trade promote positive change of banking infrastructure. Ultimately,
finance and infrastructure financing we Be an active corporate entity the most significant outcomes of our
facilitate allocation of capital business activities are contribution to
Facilitate access to financial services, BANK ASIA’S VALUE socioeconomic development, which we
enabling socioeconomic development CREATION ACTIVITIES are achieving through profitability and the
and personal wealth creation, which The outcomes of the roles we play in the amount of dividend and tax of Bank Asia in
are relevant to the markets in which we course of our business activities, and 2017 was 12.50% (proposed) and
operate the ways to ensure that value creation is Tk. 4,408 million respectively. As the
Provide effective markets to encourage maintained, are illustrated below: Basel Capital Accord (Basel) requires banks
banking activities of customers and to allocate financial capital to meet capital
clients through secure and reliable THE VALUE WE HAVE CREATED requirements, so we facilitate allocation of
transactional systems and processes Being a financial institution engaging capital to support economic growth and in
Enable financial protection and in banking activities, we are a part and 2017 our reinvestment amount was
diversification through risk transfer parcel of economy and facilitate at a Tk. 4,678 million. In addition, we had Tk.
To ensure customers have safe as well fundamental level of economic growth 5.99 million as environmental savings
as convenient access to their savings and social development of the economies and as financial inclusion we are serving
and funds we deploy and maintain the we serve. 1,629,286 beneficiaries through EBEK
integrity of banking infrastructure project and 311,947 account holders with
Build and maintain a good governance We always believe that one of our greatest a growth of 145% through Agent banking
framework to protect and enrich value strength is Human Resource and for program. To protect and enrich value
creation quality and value added service to the creation, we build value based culture and
Actively make progress against our stakeholders, we frequently arrange maintain strong systems and governance
strategic priorities to achieve our vision training and development programs to frameworks.
Engage with stakeholders and our employees. We have also made 8%
responsive to their concerns growth in employment creation from last

Environmental
Savings Beneficiaries A/c of Agent
(Taka in million)
of EBEK Banking
5.99 201 7 1,629,286 2017 311,947 2017
5.88 201 6 1,266,930 2016 132,353 2016
5.00 201 5 1,147,125 2015 50,960 2015

Our commitment gradually With an aim to serve the Provide banking services to
increasing over the years for unbanked people, Bank Asia geographically dispersed poor
maintaining eco friendly successfully operating EBEK segment of the society through
environment which is (Ektee Bari Ektee Khamar) Agent banking since 2013
essential for our survival project since 2012

Annual Integrated Report 2017

103
 Capital Input Stage

Capital is one of the Financing and funding arranged from

valued depositors and shareholders
most vital factors Financial in the form of deposits, equity and
Capital resinvestment that are used in
making loans, advances and
of production. investment

Banking industry
belongs to service People involved in planning, executing,
monitoring and controlling business on
sector where human Human whom Bank Asia has investment to
build up leadership skills and
Capital competencies for the purpose of
capital is the most making an industry competitive and
customer oriented workforce
valuable asset. Bank
Asia has enriched
its capitals in every Valuable resources, business

form whether Manufacturing processes and technologies used in

providing effective, efficient and
Capital innovative services to our customers
financial capital,
human capital,
manufacturing Aggregate value of intangible

capital or intellectual Intellectual

intellectual resources like brand
image, enriched knowledge and
competencies of employees,
capital to ensure Capital innovative research and development
team, market reputation that offers a
competitive edge to Bank Asia
future growth and
prospects
The relationship of Bank Asia with its
Social and stakeholders like business partners,
regulators, customers, voluntary
Relationship organizations which help build
Capital and maintain a strong social
reputation and trust

The stock of both natural and

Natural biological resources gifted by

nature but preserved by
Capital ourselves like air, water, minerals,
soils, fuels and living things

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104
 Output Stage
Value Added Stage Performance Stage (For Stakeholders)

Bank Asia provides diverse forms of

deposit schemes with attractive
Deposit Tk. 207,041 million
deposit rates and makes assessment
in terms of risk exposure, capital Loan & advance Tk. 197,504 million Customers
adequacy, loan provision and Profit earned Tk. 2,048 million
regulators’ instructions in advancing
loans and making investment Bank Asia always shows a positive
response tworads customers and
innovation in customer services and
thereby loan, deposit and profit of the
Bank increased in by 21%, 8% and 32%
respectively compared to previous year.

Employees are motivated and 2,087 employees engaged in Bank Asia

supported to participate in both 239 new employees recruited during
internal and external training on
different issues throughout the year
the year
Profit per employee Tk. 3.2 million
Shareholders

BA tries to generate risk-adjusted return

for its shareholders. BA has proposed a
12.5% dividend in 2017, NAV per share
increased to Tk. 21.33 compared to
Tk. 19.29, EPS increased to Tk. 2.07
compared to Tk. 1.57 from the last year
Bank Asia focuses on a skilled and
competent employee force, strong 116 branches
internal business process platform, 63% of cash transactios through ATMs
NPL ratio came down to 4.38% from
output based infrastructural facility
in all the branches, a number of to 5.41% Employees
diversified products

Total 239 new employees recruited and

61,095 manhours training with provided
to both existing and new employees
during the year where 260 claims of
Tk. 2,654 million agent banking deposit insurance received for Tk. 8.99 million
Introducing and expanding product
1.62 million beneficiary of EBEK project
portfolio, reducing service waiting
Ever expanding Alternative Delivery
time, conducting customer service
quality survey, Bank Asia creates a
Channel (ADC) Government &
Non-interest income increased by 24% Regulators
market reputation
where expenses increased by only 12%

Bank Asia complies with all the rules

and regulations of regulators i.e. BB,
BSEC, MoF, NBR, and relevant laws.
Total 4,408 million tax and VAT paid
by the Bank in 2017
Bank Asia builds relationship with
customers providing smooth and
innovative services, contributes to Spent an amount of Tk.183.83
our society through CSR, helps million for the overall betterment of
government paying corporate tax the nation Local Communities
and collecting VATs, supports
regulator for financial stability.
Bank Asia always plays an active role for
the growth of its community in eduaction,
health, disaster management, environ-
ment, sports, art & culture. CSR activities
for the year 2017 comes to Tk. 183.83
million compared to 109 million in 2016.
Bank Asia tries to create a public
awareness on the preservation of Net savings from reducing energy
natural capital, reduction of wastage and resource consumption for the
and keep the environment free from year 2017 was Tk. 5.99 million
pollution through its Sustainability having a positive impact on
Report which conveys a message profitability of the Bank
to our stakeholders .

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105
 Risk
Management
Report
The table below gives an overview of the
locations of our risk disclosures.

RISK MANAGEMENT FRAMEWORK

Page: 111-113

RISK MITIGATION METHODOLOGY

Page: 114-119

DISCLOSURE OF RISK REPORTING

Page: 120-125

Bank Asia Limited

106
Annual Integrated Report 2017
107
 From Chief Risk
Officer’s Desk
Policies
The bank is committed toward adopting
Board approved policies for managing
each risk type. These policies aim to
articulate responsibility for managing each
risk and requirements for measurement
and reporting.
Risk outlook
While many other occurrences that
will have a substantial impact on risk
functions over the upcoming period are
unpredictable, we believe that at least key
trends are powerful and certain enough to
help paint a picture of the risk outlook of
the banking industry during the year 2018:
Impaired Credit Portfolio
In general the NPL against bank credit
tend to have positive correlation with loan
growth. Considering the aforementioned
scenario and prevailing industry wide
credit growth ratye, the overall NPL of the
banking industry is likely to be worsen.
The situation might overshoot (i.e. as
compared to 2017) due to expected
liquidity crunch which also likely to push
the overall lending rate in the upcoming
The year 2017, can be phased as a period of economic transformation for Bangladesh.
year. On top of above the upcoming
During the year the country has broken the long continued six percent economic growth
national election might echo the degree of
trend by achieving 7.28% growth (FY 2016-17). The result was primarily driven by various
credit risk.
achievements and challenges. Being an integral part of the economy, the banking
industry also shared identical experiences. In addition to that the financial service Growing Regulatory Compliance
offering of Bangladeshi Bank(s) is becoming complex to sustain in an intense competitive Recent pattern of intense competition
environment. Altogether the competitiveness along with the complexity of the banking is triggering various illegal and unethical
industry is triggering various uncertainties resulted to multidimensional material risks. behavior in the overall banking operation
As such risk management practice is mounting in the highest priority list for banking as a result the likelihood of bank collapse
operation. The tendency of risk management is further boosting due to rigorous vigilant is mounting. In connection with the above,
of regulatory authorities i.e. Bangladesh Bank, Bangladesh Security and Exchange the demand of regulatory compliance
Commission and other stakeholders. Being an active part of countries’ banking industry, is increasing both domestically and
Bank Asia Ltd., has undertaken an active approach to risk management and remained internationally and bank might face
consistent in forming a best-in-class capability. The core motto of risk management challenges to meet the requirement in
practice at Bank Asia Ltd. are, well understand the materials risks of the bank and Strategy various regulatory aspects.
formulation for active risk mitigation.
Trending Client’s Expectations
Risk Management Framework In the coming days, customer
The risk management framework of Bank Asia Ltd., has duly articulated the approach expectations and technology are expected
of implementing enterprise wide risk management. The framework has duly defined to cause massive alteration in banking and
the responsibilities of each stakeholders from respective position. The process related give it an entirely different profile. In the
to formulating risk strategies, setting risk appetite, key performance indicator of risk international survey outcome indicates
management activities and overall supervision process are all part of the bank’s risk the tech-savvy younger generation will
management framework. be major revenue generator to bank by
2025 which is a clear indication of shift in
Strategy and Risk Appetite
targeted client group. Apart from client
On yearly basis the Board of Director sets the broad business/operation strategies
profiling, the banking industry will be
of the bank and in line of that the Board also articulate the Risk Appetite Statement.
required to adopt rapid decision making
Subsequently the entire risk management operation of the bank is derived focusing on
practice along with individual client wise
the risk appetite statement. The aforementioned feature ultimately helped the bank to
pricing for acquisition of quality client
adopt such a risk management practice which by nature is practical and sensitive to
base.
trending macro-economic position.

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Risk Management Report

Changing Technology
The technological trend will not only
affect client behavior but also expected
to mold the overall risk management
operation. Particularly the introduction
of concepts like Big Data, Block Chain,
machine learning etc. is likely to change
the shape of risk/data analysis and
Management Information System (MIS).
The clients are thriving toward technology
based banking services, the vast popularity
of online account opening; mobile banking
and other online based banking services
are direct result of the same. This shift of
technology in one end enforcing the banks
of this territory to seriously think about
revaluation of current banking operation
in view of technology, on the other hand,
inviting cybercrime.
Management of Operational Risk
During the last decades the management
of financial risks has advanced in the
banking industry of Bangladesh but
the non-financial risks resulting from
various operational lapses has remained
unattended. The tremendous increase in
fines, damages, and legal costs related to
operational and compliance risk over the
past years is ultimately forcing banks to
pay much more attention to these risks.
Bank’s Readiness
During the upcoming year, among other
areas of risk, bank will extend majority
focus in addressing capital optimization,
credit risk, technology risk and operational
risk. In addition to that bank has already
initiated the development process of
Internal Credit Rating System (ICRS). Upon
successful implementation the bank will
be able to assess optimum level of capital
requirement and take capital benefit
under Basel Accord. In addition the bank
will also be eligible to migrate to advance
approach for credit risk assessment, which
is popularly known as Internal Rating
Based Approach (IRB). Apart from above,
the adoption of Capital Rationing will be Diagram
initiated from ensuring precise level of Credit Approval
capital rationing. System of
Bank Asia

Md. Sazzad Hossain

DMD & CRO

Annual Integrated Report 2017

109
 Statement on Non-Performing
Loan (NPL) Management
One of our core business priorities is to TOTAL CLASSIFIED LOANS COUNTRY VS BANK ASIA (In Billion)
curb non-performing loans by maintaining Bank Asia Country
quality assets. In this regard, Bank Asia’s 2017 2016 2017 2016
credit approval process has been framed CL Amount 8.64 8.85 803.10 621.8
to unveil and assess the unforeseen CL Ratio (in %) 4.38% 5.41% 10.70% 9.2%
inherent risk so that assets quality will not
deteriorate in the long run. Additionally, NPL BY BANKS TYPE (In Billion)
early warning system gives us alarms so Types of Total Classified Required Provision Provision
that precautionary actions taken against Banks Loan Provision Maintained Maintenance
vulnerable assets. Above all, proper Ratio (%)
monitoring and strong recovery drive from SCBs 385.20 220.90 145.30 65.80
branch and corporate office help maintain DFIs 55.20 27.80 28.8 103.60
quality assets of Bank Asia. From 2016
PCBs 339.70 197.40 208.20 105.50
Debt Collection Unit under SAMD (Special
Asset Management Division) was formed FCBs 23.00 16.90 17.50 103.60
for further recovery drives of written off Total 803.10 463.10 399.70
Source: Bangladesh Bank, Quarterly (July-September, 2017) Vol XV, No 1
loans. Executives of Corporate Office got
involved in recovery campaign alongside NPL & Recovery Status of Bank Asia In the year 2018, our strategic
with their normal desk activities as an The Bank ended the year with planning will be as follows:
innovative idea that resulted in ahuge NPL 4.38%Non-performing loan or classified 1. Strong Supervision, follow up and
recovery in 2017. loan which was amounted to Tk. 8,642 monitoring for the NPL accounts as
million compared to Tk.8,847.33 million well as rescheduling & restructured
STRATEGIES FOR NPL MANAGEMENT & compared to 2016. We have Tk.8,581.81 loans to be ensured both by on-site
RECOVERY PROCESS million under stay order where a and off-site basis
The recovery strategies are formulated significant portion of classified loans 2. In every NPL prone branch, a recovery
based on analysis carried out by the came from the vacated of stay order from unit must be formed and a weekly
following four units of the Division: Honorable High Court. feedback to be taken by SAMD
Recovery Unit Off-site (Non-Legal) At the end of 2017, the Bank’s write off 3. Proper monitoring, follow up &
Recovery Unit On-site (Non-Legal) loans was Tk. 7,261.47 million against supervision in pre-classification stage
Debt Collection Unit (Write-off) 176 accounts compared to Tk. 5,122.92 should be ensured by C&LL, ME, CMSE,
Recovery Unit-Legal and million against 127 accounts in 2016. The CRM and other concerned departments
Recovery Unit MIS & Compliance. closing balance has increased due to 4. Adequate staff in SAMD and optimum
addition of Tk. 2,138.41 million as write utilization of manpower in SAMD to be
All the units are working on different area off loans as well as collection of Tk. 36.38 ensured
of recovery process towards achievement million from written-off accounts. 5. Appropriate Legal action to be initiated
of their time bound set goals. They are During the year 79.21% of rescheduled 6. Amicable settlement may be allowed in
also keeping good contribution in the loans remained standard, i.e. cash applicable sector
profitability of the Bank through recovery recovery and installment payments 7. A separate Recovery Unit for
of NPL vis a vis release of Interest Suspense of major rescheduled / restructured Chittagong Zone to be formed
kept suspended against NPL. borrowers were regular. It may also 8. Recovery Agent may be engaged in
be noted that the remaining 20.79% some special cases.
NPL STATUS OF BANKING INDUSTRY of rescheduled loans that were 9. Eligible accounts to be written-off as
OF THE COUNTRY downgraded to classified status per Guidelines of Bangladesh Bank.
TThe amount of classified loan in country constitutes 61.36% of total classified
increased to Tk. 803.10 billion in 2017 from We are optimistic that by deploying our
loans. Management has already
Tk. 621.72 billion in 2016.So, having growth above mentioned strategies, we will be
increased recovery initiatives from
of 19% despite huge rescheduling and able to keep the classified loan of the bank
those defaulted loans.
restructuring of loans. within 3.50% at the end of the year 2018.
The cash recovery against Classified
Furthermore, with the concentrated efforts
Loans and Written off loan during the
by our “Debt Collection Unit” we will also
Year/Period was one of the highest in last
be able to recover Tk. 300.00 million from
couple of years which was tk. 2.79 billion
the written-off accounts of the bank by this
in 2017 over tk. 1.89 billion in 2016 from
year. Bank Asia is putting all out efforts to
hard core rescheduled, restructured, B &
recover defaulted clients and stop fresh
L and write off loan accounts.
inclusion of CL. For success in that front,
management is further streamlining its
credit appraisal process.

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Risk Management Report

RISK MANAGEMENT FRAMEWORK

1. INTRODUCTION: measured only by adopting a strong risk methodologies/models to accurately
Effective risk management is management process by communicating calculate additional capital requirement
fundamental to the success of the concise risk management standards to on top of minimum capital requirement.
Bank. It is the architecture that all concerned officials through adequate
includes risk management principles, policies, directives, operating procedures 2. MAJOR COMPONENT OF RISK
a risk management framework and and training programs. MANAGEMENT OF BANK ASIA
a risk management process. The risk The Bank’s risk management framework
management is primarily consists of 1.1. B Risk Management Units is applied on an enterprise wide basis and
understanding material risks and handling of the Bank consists of three key elements:
those risks in a way best-suited to achieve Credit Risk Management and Client Risk Governance,
organizational objectives. Effective risk Rating Unit is primarily responsible for Risk Appetite, and
management has also given us so many finding out and recommending mitigation Risk Management Procedure
benefits like reduction of frequency for all credit risk related issues of the bank.
Major focus of the unit will be to ensure 2.1 Risk management framework
and severity of losses, safe and sound of Bank Asia Limited
banking practices and better returns to continuous understanding of any kind
The risk management framework is
stakeholders due to lower losses. of changes in risk parameter and review
combination of different global and
of credit related activities of the bank to
national rules, regulation and practices
The banking sector in Bangladesh plays measure the performance of existing credit
and risk management standards which are
a vital role in the financial system as it risk management tools. This unit is also applicable for overall risk management
has the capacity to supply credit and responsible for developing internal client of the bank. The primary goals of risk
liquidity to the entire economy, providing rating model and periodic credit related management are to ensure that the
payment services and thereby facilitating reporting of the bank management and outcomes of risk-taking activities are
financial transactions in the economy. Board Risk Management Committee consistent with the Bank’s strategies
However, in search of growth amidst and risk appetite, and that there is an
emerging risks, evolving risk function, stiff Market Risk Management Unit is primarily appropriate balance between risk and
competition and the government reliance responsible to identify, assess, manage, reward in order to maximize shareholder
on the financial sector as a main revenue report and any risk arising from Asset- returns.
source, banks were compelled to expose Liability mismatch, change in yield curve
themselves to a much higher level of risks and/or market volatility (FX or equity Effective risk management begins with
effective risk governance. The Bank has a
where systematic management of risks investment).
well-established risk governance structure,
become the key differentiator. Risks are
with an active and engaged Board of
created and amplified by certain events Operational Risk Management Unit
Directors supported by an experienced
that occur and such key events took place is primary responsible to manage any senior management team and a
during year 2017 driving the demand for possible operational risk resulting from centralized risk management group that is
improved risk management practices. people, process, system and external independent of the business lines.
Some developments necessitated the forces.
enhancement of risk management In line with global and national level risk
techniques, broadening of risk reporting Process Development and Review Unit management framework Bank Asia Ltd.
and building a strong risk management is basically a process reengineering unit. has own Risk management framework
culture within the banking and financial This unit will proactively review various for overall risk management of the Bank.
sector in Bangladesh. operational processes (regardless of Following are main elements of a risk
any specific risk) to identify any area of management framework that apply Bank
1.1. A Risk Management Approach development. Based on such identification irrespective of its size and complexity of
It is important not only fulfill regulatory the unit will take necessary steps to business:
requirements but also improve financial enrich the process i.e. through policy/ First and foremost, effective risk
and operational performance of the process development and eventual management framework demands
banks. Strong and integrated risk implementation, which can not only active involvement of the Board of
management is essential for the long-term safeguard bank’s asset but also contribute Directors (BoD) and senior management
sustainability of the bank’s business. The strongly towards profitability. in the formulation and oversight of risk
comprehensive risk management policies management processes. Accordingly, they
and sophisticated risk management Capital Management Unit should provide strategic direction and
processes are required for systematic is primarily responsible to ensure approve the overall business strategies
identification, measurement, monitoring execution of Pillar –II capital computation. and significant policies of the Bank,
and controlling of all business risks. More precisely the unit will develop including those related to managing and
Bank’s overall financial soundness can be taking risks, and should also ensure that

Annual Integrated Report 2017

111
 Risk Management Report

senior management is fully capable of Central Bank has issued a circular DOS#13, dated September 09, 2015. The major change
managing the activities that the Bank observations of that circular are:
institutions undertake Revision of organogram of Risk Management Division
Second, adequate Policies, Procedures, Enhancement of the role of Risk Management Division
and Limits need to be defined by the Setting minimum interaction of Head of RMD with various committees of the bank
Directors and senior management to The primary role of the division is to identify the gap in current operational process of the
tailor the risk management policies and bank and as prescribed structure in respective core risk guideline, facilitation of formation
procedures to the types of risks that arise and providing secretarial services to core risk management committee, facilitate
from the activities of the Bank recommendation and change implementation process regarding improvement in core
Third, adequate Risk Monitoring and risk areas.
Management Information Systems is
developed for effective risk monitoring BANK ASIA’S RISK MANAGEMENT STRUCTURE
and to identify and measure all material Board Risk Management Committee
risk exposures. Consequently, risk Design and implement Risk strategy and policy
monitoring activities must be supported Review, monitor and understand risk profile of the bank
by information systems that provide senior Review and recommend bank’s risk appetite, limit and tolerance level
managers and directors with timely reports
on the financial condition, operating
performance, and risk exposure of the Board of Directors
institution
Fourth, establishing and maintaining an
effective system of controls, including the Management Level
enforcement of official lines of authority
Executive Risk Management
and the appropriate separation of duties
Committee
such as trading, custodial, and back-office Supervisiory Review Process
Board Risk Management
is one of management’s more important Risk Management Division Committee
Committee
responsibilities. A properly structured Operational Level Core Risk Management Strategic Level
system of internal controls promote Committee
effective operations and reliable financial
and regulatory reporting, safeguards
assets, and helps to ensure compliance
with relevant laws, regulations, and bank
policies Review of Management level operational risk structure
Performance review and recommendation
Fifth, the Risk Management Function
Executive Risk Management Committee
institutionalized to supervise overall risk
Determining general principal for measuring, managing and reporting the bank’s risk
management at the bank. Ideally, overall
risk management function is independent Oversee the development, implementation and maintenance of the bank’s overall
from those who take or accept risk on risk management framework and risk appetite, strategy, principals and policies
behalf of the bank. To ensure bank’s Risk Management practices are in line with regulatory benchmark
and industry best practice
Establishment of Risk Management Ensuring appropriate knowledge, experience and expertise of lower-level managers
Division of Bank Asia Limited
and staff involved in risk management
As per Bangladesh Bank’s advised Supervisory Review Process Committee
all scheduled banks including Bank Ensure that the bank has an internal process to indentify and assess all relevant risks
Asia Limited formed a separate Risk of the bank
Management Unit through letter reference Vetting/recommending general principal for development of ICAAP document
no 1164/14 (Bank Asia) /2009-464, dated Ensure that capital is adequately allocated against the ICAAP outcome
June 10th, 2009. In order to comply Error free and timely reporting of ICAAP outcome to Strategic layer and BB
Bangladesh Bank requirement Bank Asia Core Risk Assessment Management Committee
Limited has formed a dedicated Risk Adoption of in-house core risk assessment methodology
Management Unit which subsequently Perform periodic assessment of Core Risk Guidelines’ implementation status
restructured and approve as Risk Review and approval of core risk rating and recommendation for improvement
Management Division (RMD) during 246th Extend supervisory support for implementation of committee’s resolution
Board meeting vide memo no. 6618/2013
dated 13th February, 2013.
In order to strengthening and updating
the risk management system of the bank,

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112
 Credit Risk

Market Risk Interest Equity risk

Rate Risk

Foreign Commodity
exchange risk Liquidity
risk Risk

Operational Reputation Strategic

Risk Risk Risk

Internal Control Money

& Compliance Risk Laundering Risk

Environmental
And Climate
Change Risk

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113
 Risk Management Report

RISK MITIGATION METHODOLOGY

The success of banking operation largely depends on choosing the best equation between risk and return. This implies that by nature
the banking operation is subject to various risks. However to ensure the sustainability, among all other factors creating value (i.e. return/
profit) is a basic requirement for any financial organization. Keeping the uncertainty factor in mind each bank need to adopt a risk
management framework that should be effectively enough to manage all material uncertainties to achieve the goal of the organization.

Monitoring &
Reporting Identification

Control Assessment

Prioritize

The process starts through defining what the organization wants to achieve and the external and internal factors that may influence
success in achieving those objectives. This step is called establishing the context and is an essential precursor to risk identification.

Risk assessment comprises the three steps of risk identification, risk analysis, and risk evaluation. Risk identification requires the
application of a systematic process to understand what could happen, how, when, and why.

Risk analysis is concerned with developing an understanding of each risk, its consequences, and the likelihood of those consequences.

Risk evaluation involves making decision about the level of risk and the priority for attention through the application of the criteria
developed when the context was established.

Risk treatment is the process by which existing controls are improved or new controls are developed and implemented.

Risk Appetite
Risk Appetite refers to the broad types and amounts of risks that a bank is willing to undertake in implementing its business strategy.
Setting the risk appetite is an exercise where Bank’s risk capital is allocated effectively and risk limits are set within the risk strategy of the
Bank. Thus, the risk appetite is set, covering overall group position of a bank ensuring main business units are in line with the business
objectives set by Board of Directors. Risk appetite statement includes qualitative and quantitative measurements, which are linked with
earnings, capital, liquidity and other relevant measures, as appropriate. Bank assures a balance between risk goals set and forecasts of
short to long-term strategy and capital planning. Thus, preparation of risk appetite statement is based on forward looking assumptions
to support achieving the Bank’s overall objectives.

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Risk Management Report

Board of Director
Reviews, challenges & determines

Capital & Liquidity plan All relevant risks

Strategy
Risk Appetite Qualitative &
Quantitative elements

Risk Limits
Ongoing monitoring of the business
• Business lines & Concentration
• Trends
• Economic developments

Risk Exposure
Aggregation

All relevant Risks

Setting & Monitoring Risk Appetite

1. CREDIT RISK:
Credit risk primarily triggers either from limit, consumer/ retail loan, personal
unwillingness or inability of a credit A. Operating Under Sound Credit loan etc.
borrower to serve its obligation, resulting Granting Procedure B. Maintaining and Appropriate Credit
economic loss to the bank. Credit risk Bank followed strictly specified policies, Administration Measurement and
arises from on balance sheet claims such as standard for granting credit by way of Monitoring Process
loan and overdrafts as well as off balance evaluating borrower: Bank established an appropriate credit
sheet commitments such as guarantee, Internal credit rating assessment administration measurement and
acceptance, letter of credit etc. Similar to External credit rating assessment by ECAI monitoring process to mitigate credit
most other banking institutes, in the case of Analysis of specific borrower repayment risk.
Bank Asia Limited, loans are the largest and capacity- review of financial statements Borrower follow-up and corrective
most obvious sources of credit risk. by way of analysis five key financial action
Bank’s credit risk management (CRM) indicators- Balance Sheet, Income Internal loan review.
specifically addresses the following areas: Statement, Net worth and Fixed Assets
reconciliation, Key ratios and Cash flows Timely identification of problem assets:
The CRM should be mainly responsible for: statements
Implementation of the credit risk Risk based loan pricing Documentation Weakness
policy/ strategy approved by the Credit growth increase after ensuring Failing to file collateral agreements/
board. optimum asset quality and without security agreements with appropriate
Ensure compliance with limits compromising bank’s standard of public departments
approved by the board excellence Transferring the collateral to another
Makings recommendations to the Credit facilities are allowed after country/state
board, for its approval, clear policies consideration of absolute due diligence Guaranties with expired dates Changes
on standards for presentation of credit Inherent risk in credit proposal are being in legal status
proposals, financial covenants, rating identified and mitigation steps are taken Unauthorized corporate/ partner
standards and benchmarks. Collateral is properly valued and verified signatures Collateral Deterioration
Deciding delegation of credit approving by concerned officer in periodically Changes of value in the marketplace
powers, prudential limits on large credit basis Rising interest rates decrease real estate
exposures, standards for loan collateral, Risk grading is being done in line with and investments
portfolio management, loan review the Bangladesh Bank guideline and Technological advances
mechanism, risk concentrations, risk bank’s own policy Rapid depreciation of equipment or
monitoring and evaluation, pricing of Credit delegations are specified for new/ inventory
loans, provisioning, regulatory/legal fresh limit, renewal or enhancement of Tax law changes (real estate)
compliance, etc.
Annual Integrated Report 2017
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 Risk Management Report

Natural disasters
Spoilage or mishandling of collateral.

Extended Credit and High Use of Lines of Credit

Borrower is at the top of line each month
Failure to meet financial covenants in loan agreement
Delays in payment of principal and interest Use of overdrafts/low balances in current account
Credit inquiries from other lenders
Change of accountants
Other Indications of Problem Loans
Delay in receipt of financial statements
Delay in management promises or
Adequate provision maintain

C. Ensuring Adequate Controls Over Credit Risk

Bank established a system of independent, ongoing credit review and the results of such review are communicated directly to the Board
of Directors and senior management. Detail on credit risk management is disclosed in CRO’s report page no. 108 and other part of
Annual Integrated Report 2017

Credit Management Procedure

Credit Credit Credit Post

Orientation Assessment Approval Monitoring

Pre-Assessment NPL
Recommendation Documentation
Processing Management

Source of Credit Risk

Credit Concentration: Single/Group Borrower, Sector, Total Exposure etc.
Credit Management Issue: Wrong selections of borrower,
inaccurate credit need assessment etc.

Credit Portfolio Analysis Past Due Monitoring

Client Rating Transition Matrix
Concentration Risk Analysis Credit Risk Status of Overdue Bill
EOL Monitoring etc. Management Reschedule Account Monitoring etc.

2. MARKET RISK :
Market risk is defined as the risk of losses against expected (fair) value of financial assets, liabilities and off-balance sheet items resulting
from absurd market condition (e.g. macro-economic factors). The underlying risk is also considered as non-diversifiable risk, i.e. risk that
cannot be avoided. In general market risk is often triggered by other forms of financial risks such as credit and market liquidity risks. For
example, a downgraded of the credit standing of an issuer (e.g. share) could lead to a drop in the market value of the securities issued by
the issuer. Furthermore, a major sale security by another holder could depress the price of the security.
2.1 Interest Rate Risk arising from mismatches in the interest rate profile of assets, liabilities and capital instruments including basis
risk arising from different interest rate benchmarks, interest rate re-pricing risk, yield curve risk and embedded optionality.

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2.2 Equity risk is defined as loses due to changes in market price of equity held by the Bank. To measure and identify this risk, marks to
market valuations of the equity instruments that are traded in secondary market are made. The minimum capital standard for equities is
expressed in terms of two separately calculated charges for the “specific risk” of holding a long or short position in an individual equity and
for the “general market risk” of holding a long or short position in the market as a whole.

2.3 Foreign exchange risk arising mainly from our strategic investments which are denominated in currencies other than the BDT. Foreign
exchange position is managed by treasury division. In the year ended 2017, Total Risk Weighted Assets for Foreign Exchange Risk is Tk. 1,136
million and capital requirement is Tk. 113.6 million.

2.4 Commodity risk is the risk of loss due to changes in spot and forward prices and the volatility of precious and base metals, and
energy products. A commodity is defined as a physical product which is or can be traded on a secondary market, e.g. agricultural products,
minerals (including oil) and precious metals. The price risk in commodities is often more complex and volatile than that associated with
currencies and interest rates. Commodity markets may also be less liquid than those for interest rates and currencies and, as a result,
changes in supply and demand can have a more dramatic effect on price and volatility. These market characteristics can make price
transparency and the effective hedging of commodities risk more difficult. For spot or physical trading, the directional risk arising from a
change in the spot price is the most important risk. However, banks using portfolio strategies involving forward and derivative contracts are
exposed to a variety of additional risks, which may well be larger than the risk of a change in spot prices. In the year ended 2017, Bank has
no Risk Weighted Assets for Commodity Risk.

Interest Rate Equity Price Foreign

Risk Risk Exchange Risk

Structure of market Market risk

Interest rate risk General market risk
portfolio management policy

Comparison of Structure of rate VaR (Value at Risk) Develop and

market portfolio sensitive asset and analysis on foreign implement separate
Status of dealers liabilities excahnge position, policy on market risk
limit equity and bond management
Classification on
Profit/loss against holding position
fixed and floating
market activities rate
Actual and required Impact regarding
provision shift of interest rate

3. LIQUIDITY RISK :
Liquidity risk is the potential for loss to an institution arising from either its inability to meet its obligations as they fall due or to fund
increases in assets without incurring unacceptable cost or losses. An institution short of liquidity may have to undertake transaction at heavy
cost resulting in a loss of earning or in worst case scenario; the liquidity risk could result in bankruptcy.
Banking organization like Bank Asia Ltd., where off-balance sheet exposure is significant or has strong dependency on corporate deposit
or experiencing step asset (i.e. primarily credit portfolio or investment book) growth is exposed to high level of Liquidity risk. Liquidity risk
should not be seen in isolation, because financial risks are not mutually exclusive and liquidity risk is often triggered by consequence of
other financial risks such as credit risk, interest rate risk, foreign exchange risk etc.
a) Funding liquidity risk: risk generates when bank will be unable to meet its current and future cash flow and collateral needs without
affecting its daily operations or its financial condition.
b) Market liquidity risk: risk generate when bank cannot easily offset or sell a position without incurring a loss because of inadequate depth
in the market.
Bank Asia assesses liquidity risk in ICAAP document under Pillar-2 by considering following key indicators:

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Regulatory Liquidity Indicators (RLIs):

Cash Reserve Requirement (CRR)
Statutory Liquidity Ratio (SLR)
Medium Term Funding Ratio (MTFR) General
Liquidity Macro Economic analysis
Liquidity Coverage Ratio (LCR) Pair analysis
Net Stable Funding Raito (NSFR) Analysis Interest rate analysis
Maximum Cumulative Outflow (MCO)
Advance Deposit Ratio (ADR)/
Investment Deposit Ratio (IDR) Fund Repayment Against Loan Portfolio
Management Undrawn commitment
Bank’s own liquidity monitoring tools Analysis Liquidity Profile
Wholesale Borrowing and Funding
Guidelines,
Liquidity Contingency Plan, lysis
Management Action Trigger (MAT) Regulatory Liquidity Indicatior ana ment
idit y strength assess
Ratio short term Liqu
essment
Computation of capital charge against Analysis Long term Liquidity strength ass
above key liquidity indicators, bank
maintained additional capital.
4. OPERATIONAL RISK:
Operational Risk refers to the risk of
loss resulting from inadequate or failed
internal process, people and system
or from external events. This definition
includes legal risk but excludes strategic
and reputational risk. Unlike other risk as Lack of adequate skill and Damage of physical assets Terrorism
knowledge Inadequate or obsolete Vandalism
faced by the bank, the operational risk Inadequate training and technology Earthquaks
development Lack of proper Fires
is inherent in most of the process and Improperly aligned compen- documentation Floods
sation schemes and incen- Lack or inadequate policy,
operations of the bank and cannot be tives procedure and controls
Inadequate human resource Poor information manage-
separated from other risks. Operational and segregation of duties ment system
Lack of understanding of Lack or inadequate
risk in a bank are the functions of the performance standard or contingent plans
expectations
bank’s overall environment and culture,
employee competence and integrity,
management strategies and philosophies,
extent and degree of process centric Process review and Risk Control Self Key Risk Indicator Operational Loss Data
approach to business, etc. reengineering Assessment
Audit Report review

5. REPUTATION RISK: Operational Risk Management

Reputation risk is the current or

prospective risk to earnings and capital
that arise from decline in the customer
base, costly litigation due to adverse affect the capital base if the driving forces of 6. STRATEGIC RISK:
perception of the stakeholders. It the risk turn worse. Banks assess reputational Strategic risk means the current or
originate from the lack of compliance risk in ICAAP document under Pillar-2 by prospective risk to earnings and capital
with industry service standards or considering following key indicators: arising from imperfection in business strategy
regulation, failure to meet commitments, Credit Rating conducted by ECAIs formulation, inefficiencies in implementing
inefficient and poor quality customer Internal fraud business strategy, non-adaptability/ less
service, lack of fair market practices, External fraud adaptability with the changes in the business
unreasonably high costs and Non-payment or delayed payment environment and adverse business decisions.
inappropriate business conduct. In a of accepted bills (foreign & domestic) Strategic risk induces operational loss that
nutshell, “reputation risk arises from the Quality of customer service. consequentially hampers the capital base.
failure to meet stakeholders’ reasonable
expectation of bank’s performance and Assessing above key indicators for all aspects In this context, strategic risk possesses a
behavior”. Reputation risk is a subset bank maintains additional capital for that/ significant space in the ICAAP of the banks,
of operational risk which can adversely those risk/risks.

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following aspects is considered:

CAMELS rating – optimum level (satisfactory)
Operating expenses as % of operating income- optimum level up to 45%
Classified loans as % of total outstanding loans- optimum level up to 5%
Classified loan recovery as % of total classified loans- optimum level minimum 20%
Written-off loans as % of total classified loans- optimum level up to 15%
Interest waiver as % of total classified loans-optimum level up to 5%.
7. INTERNAL CONTROL & COMPLIANCE RISK:
Internal control is the process, affected by a company’s board of directors, management and other personnel, designed to provide reasonable
assurance regarding the achievement of objectives in the effectiveness and efficiency of operations, the reliability of financial reporting and
compliance with applicable laws, regulations, and internal policies.

Bank’s senior management is responsible for establishing a compliance policy that contains the basic principles to be approved by the board
and explains the main processes by which compliance risks are to be identified and managed through all levels of the organization.

The board and management are accountable for the bank’s compliance, the compliance function has an important role in supporting corporate
values, policies and processes that help ensure that the bank acts responsibly and fulfils all applicable obligations.
8. MONEY LAUNDERING RISK:
Money Laundering Risk can be defined as the loss of reputation and expenses incurred as penalty for being negligent in prevention of money
laundering. The bank has a designated chief compliance officer at Head Office and Compliance Officers at branches who independently review
the transactions of the accounts to verify suspicious transactions.
The convergence of several remarkable changes in the world markets propelled Money Laundering to become a worldwide problem. Bank Asia
considers Money Laundering and Terrorist Financing Risk not only a compliance requirement of the regulatory bodies but also as one of its core
business values. The Board of Directors and the Management are firmly committed to combat Money Laundering activities.

Banking Regulatory
Crime Events Illegal Proceed Involvement Supervision Consequence

9. ENVIRONMENTAL AND CLIMATE CHANGE RISK:

Environmental and climate change risk refers to the uncertainty or probability of losses that originates from any adverse environmental
or climate change events (natural or manmade) and/or the non- compliance of the prevailing national environmental regulations. This is
a facilitating element of credit risk arising from environmental issues. These can be due to environmental impacts caused by and / or due
to the prevailing environmental conditions. Environmental and climate change risk can hamper the business stability of the borrowers in
respect of both- i) profitability and ii) reputation. Consequentially, the extent of risk for the banks will be higher. Sector Environmental Due
Diligence (EDD) Check List specified in Guidelines on Environmental Risk Management (ERM) issued vide BRPD Circular No. 01/2011 dated
30/01/2011 is use to determine this risk. For the loans under the sectors specified in the guidelines and which will have EnvRR of ‘High (H)’
was considered for the capital charge against this risk.

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DISCLOSURE OF RISK REPORTING
Risk management report addresses the sources of funding on an ongoing structural basis. Bank prepare LCR and NSFR and
disclosure requirements of Basel III pillar submit Bangladesh Bank on monthly and quarterly basis respectively.
3, and materials risk that effect bank’s
earning, capital and shareholders’ value Credit Risk Out of three approaches Standardized Approach, IRB and Advanced IRB,
and management action plan against that Bangladesh Bank adopted Standardized Approach. The capital requirement for credit
risks set out by Bangladesh Bank. Banks risk is based on the risk assessment made by external credit assessment institutions
prepared its statement regarding capital (ECAIs) recognized by BB for capital adequacy purposes. Banks assigned a risk weight
adequacy statement in line with pillar I of to all on-balance sheet and off-balance sheet exposures. Risk weights are based on
Basel III on quarterly basis and submitted to external credit rating (solicited) as mapped with the BB rating grade or a fixed weight
Bangladesh Bank by following month both specified by BB.
in solo basis and consolidated basis. Solo Market risk Out of two approaches Standardized (Rule Based) Approach and Internal
basis included Bank’s conventional banking, Models Approach, Bangladesh Bank adopted Standardized (Rule Based) Approach. In
Islamic banking and Off- shore banking. such approach, Bank maintained capital on for various market risks (interest rate risk,
Consolidated basis included Bank and its price, foreign exchange risk and commodity risk) which were determined separately.
three subsidiary companies i.e. Bank Asia
Securities Limited, BA Exchange Company Operational risk Out of three approaches i.e. Basic Indicator Approach, Standardized
(UK) Limited and BA Express USA Inc. Approach and Advanced Measurement Approach, Bangladesh Bank adopted basic
indicator approach. Under that approach, Bank calculated capital charge is a fixed
1. BASEL III APPROACH ADOPTED: percentage (15%) of average positive annual gross income of the bank over the past
Bangladesh Bank vide its BRPD Circular three years i.e. 2015, 2016 and 2017.
No. 18 dated December 21, 2014
implemented revised regulatory capital
framework for banks in line with Basel III 2017 2016
Sl Risk Category
in Bangladesh with effect from January Million Tk. % Million Tk. %
01, 2015. Implementation process period
A Credit Risk 200,778 91% 180,801 91%
of Basel III is Jan 2015 to Dec 2019 and full
implementation will start from Jan 2020. i On- Balance sheet 155,067 70% 138,407 69%
ii Off- Balance sheet 45,710 21% 42,394 21%
Basel III incorporated strengthening capital
framework, enhancing risk coverage, risk B Market Risk 3,519 2% 2,915 1%
based capital requirement with leverage i Interest Rate Risk - 0% 182 0%
ratio, reducing procyclicality and promoting ii Equity Position Risk 2,382 1% 2,107 1%
countercyclical buffers, addressing systemic
risk and introduce global liquidity standard. iii Foreign exchange 1,136 1% 626 0%
Under Basel III capital framework, bank has C Operational Risk 16,818 8% 15,775 8%
to maintain buffer capital 2.5% in addition Total Risk Weighted Assets 221,115 100% 100% 199,491
to minimum capital requirement 10%.
Leverage ratio express % of total tier I 2. PILLAR-I MINIMUM CAPITAL REQUIREMENT (MCR) CALCULATION:
capital (after related deduction specified The MCR is a Basel prescribed minimum capital assessment process against credit,
by BB) to total exposure i.e. on balance market and operational risk of the bank. The underlying assessment is a mandatory
sheet and off- balance sheet exposure (after requirement of the Central Bank and assessment are carried out on quarterly basis.
related deduction specified by BB) and also Regarding MCR calculation Risk Management Division of the bank will perform necessary
submit the information to Bangladesh Bank analysis to understand the trend of MCR of the bank, develop necessary model to predict
on quarterly basis. the overall MCR of the bank, place necessary recommendation for improvement.
To ensure strong liquidity base, Bank 3. PILLAR-II SUPERVISORY REVIEW PROCESS UNDER ICAAP:
also maintaining two liquidity standard Internal Capital Adequacy Assessment Process (ICAAP) Supervisory Review Process (the
i.e. Liquidity Coverage Ratio (LCR) and Second Pillar of Basel-III) of Risk Based Capital Adequacy framework is intended to ensure
Net Stable Funding Ratio (NFSR) having that banks have adequate capital to support all the risks in the business and at the same
more than ≥100%. LCR was introduced to time to encourage banks to develop and use better risk management techniques in
promote short- term resilience of bank’s monitoring and managing their risks. The key principle of the supervisory review process
liquidity risk profile by ensuring that it has (SRP) is that “banks have a process for assessing overall capital adequacy in relation to
sufficient high quality liquid resources to their risk profile and a strategy for maintaining their capital at an adequate level”.
survive an acute stress scenario lasting
for one month. NSFR was introduced to As part of Basel III accords, Bank has proactively developed a comprehensive Internal
promote resilience over a longer horizon Capital Adequacy Assessment Process (ICAAP) on yearly basis as stipulated by the
(1 year) by creating additional incentives for
bank to fund its activities with more stable
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Bangladesh Bank and submits accordingly. Division wise exposure

Upon adoption of internal format, the bank (geographic concentration)
will have the ability to perform risk assessment Group wise exposure
in line with the bank’s own strategy. Single borrower wise exposure
Top borrower wise exposure.
ICAAP is aimed at ensuring that the Bank Sector wise concentration
maintains an amount of capital for additional
risk that was not covered in Pillar I of Basel 2017 2016
III. SRP committee made dialogue with Sector
Million Tk. % Million Tk. %
Bangladesh Bank SREP committee and fixed
additional capital requirement. SRP-SREP Agriculture 4,075 2% 2,340 1%
dialogue stands for an exclusive meeting Industry 96,752 49% 81,490 50%
between the SREP team of BB and SRP team
of a bank. The objective of the dialogue is Constructions 5,281 3% 5,760 4%
to determine the adequate level of capital Power, Gas, Water and Sanitary Services 2,023 1% 50 0%
needed for a bank by reviewing the ICAAP Transport, Storage and Communication 2,824 1% 2,810 2%
and strategies of the bank. The intensity and Trade Services 34,741 18% 32,040 20%
frequency of the dialogue depends on the
Housing Services 13,883 7% 12,050 7%
level of complexity and magnitude of the
banks’ activities as well as the difference Banking and Insurance 7,179 4% 7,270 4%
between the capital requirements assessed Professional and Misc. services 30,748 16% 19,800 12%
by the bank and BB. Terms of reference of the
dialogue are: Total 197,504 100% 163,610 100%

Minimum capital requirement against

credit, market and operational risks Geographical concentration
Risks to be covered under SRP e.g.
2017 2016
residual risk, concentration risk, interest Division
rate risk in the banking book, liquidity Million Tk. % Million Tk. %
risk, reputation risk, strategic risk,
settlement risk, appraisal of core risk Dhaka Division 158,640 80% 124,470 76%
management practice, environmental Chittagong Division 28,007 14% 28,470 17%
and climate change risk as well as other
material risks. Khulna Division 3,348 2% 3,069 2%
Adequate capital against comprehensive risks. Rajshahi Division 3,562 2% 4,533 3%
Stress testing exercises and results.
Barisal Division 564 0% 308 0%
4. CONCENTRATION RISK: Sylhet Division 2,265 1% 1,902 1%
Concentration risk arises for invest most or
Rangpur Division 805 0% 667 0%
all of the assets to single or few individuals
or entities or sectors or instruments. It Mymensingh Division 314 0% 191 0%
indicates bank’s failure to diversify its loan Total 197,504 121% 163,610 100%
and investment portfolios, concentration risk
emerges. Downturn in concentrated activities
and/ or areas may cause huge losses to a
Single borrower wise exposure
bank relative to its capital and can threaten Particulars Million Tk.
the bank’s health or ability to maintain its core
operations. Total Capital 32,914

Bank assesses concentration risk in ICAAP A. Maximum outstanding exposure (35% of total Capital) 11,520
document under Pillar-2 in following two ways: Maximum Funded Limit (15% of total Capital) 4,937
4.1. Credit Concentration Risk: When Maximum Non Funded Limit (20% of total Capital) 6,583
the credit portfolio of a bank is concentrated B. For Export Financing:
within a few individuals or entities or sectors,
Maximum outstanding exposure (50% of total Capital) 16,457
credit concentration risk arises. Following
individual concentration is considered for Maximum Funded Limit (15% of total Capital) 4,937
credit concentration risk: Maximum Non Funded Limit (35% of total Capital) 11,520
Sector wise exposure C. Large Loan Limit (10% of Total Capital) 3,291

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Top borrower wise exposure

Outstanding (Million Tk.) 2017 Outstanding (Million Tk.) 2016
Sl. No. Name of clients
Funded Non Funded Total Funded Non Funded Total

1 S.A Group 3,566.44 - 3,566.44 3,372.53 78.65 3,451.18

2 Aman Group 3,241.23 1,004.39 4,245.62 2,759.15 844.42 3,603.57
3 Partex Group 3,181.67 845.71 4,027.38 2,183.25 580.43 2,763.68
4 AA Yarn Mills Limited 3,034.16 1,718.00 4,752.16 - - -
5 Max Infrastructure Ltd. 2,666.43 747.38 3,413.81 - - -
6 Basundhara Group 2,647.23 2,694.77 5,342.00 2,117.82 807.97 2,925.79
7 Pran RFL Group 2,423.02 3,247.29 5,670.31 1,227.67 1,892.52 3,120.19
8 Toma Group 1,939.27 1,908.13 3,847.40 1,392.43 1,416.86 2,809.29
9 Echotex 1,717.53 2,204.97 3,922.50 659.11 2,345.92 3,005.03
10 City Group 1,256.69 3,553.97 4,810.66 1,000.70 2,928.68 3,929.38
11 Summit Group 451.59 7,277.68 7,729.27 2,537.29 3,414.16 5,951.45
12 ENERGYPAC 997.37 2,635.04 3,632.41 - - -
13 Western Marine Group 1,860.00 1,951.00 3,811.00 1,561.14 2,986.42 4,547.56
14 Abul Khair Steel Industries Ltd - - - 1,157.08 3,511.78 4,668.86
15 Renaissance Group - - - 1,305.78 1,205.11 2,510.89
16 Dird Group - - - 1,732.18 1,005.08 2,737.26
17 Bank Asia Securities Ltd. - - - 2,450.00 300.00 2,750.00
18 Meghna Group - - - 0.48 3,391.79 3,392.27
19 Spectra Engineers Limited - - - 563.45 2,098.69 2,662.14
20 Thermax Group - - - 1,613.60 987.43 2,601.03
Total 28,982.63 29,788.33 58,770.96 27,633.67 29,795.91 57,429.58

interest rate, fall of security value etc.). The impact of this model is expressed through change
in overall CAR of the bank. Central Bank has advised all banks to perform stress testing on
4.2 Market Concentration Risk: quarterly basis. The outcome of stress testing is needed submitted to Bangladesh Bank upon
When the investment portfolio of a bank review of senior management and Board.
is concentrated within a few instruments
or any instrument of few companies or Bank Asia prepared stress testing report on quarterly basis and submitted to Bangladesh Bank
any instrument of few sectors, market within the end of following month.
concentration risk arises. Following
individual concentration is considered for Following risk factors are considered Risk of Stress testing are carried out
market concentration risk: assuming three different hypothetical
at the time of Stress testing
Instrument (financial securities) scenarios
wise investment a. Credit Risk
Sector wise investment in listed Increase of NPLs (Overall)
instruments Increase of NPLs due to default of
Currency wise investment of foreign a. Minor level shocks: These represent
Top large borrowers fall in forced
exchange portfolio. small shocks to the risk factors. The
sale value of mortgaged collateral
level for different risk factors can,
Assessing concentration of above Negative shift of NPLs Categories
however, vary.
Increase of NPLs in particular
indicator for all aspects bank maintains b. Moderate level: Shocks It envisages
2 (two) sectors
additional capital for that/those risk/risks b. Interest Rate Risk medium level of shocks and the level is
defined in each risk factor separately.
5. STRESS TESTING Simple Sensitivity Analysis
c. Major level shocks: It involves big
Duration GAP Analysis
The underlying tool is used to assess the shocks to all the risk factors and is also
c. Exchange Rate Risk
bank’s vulnerability to unexpected but defined separately for each risk factor.
d. Equity Price Risk
presumable change in various related e. Liquidity Risk
factors (e.g. increase in NPL, change in f. Value at Risk (VaR)
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6. MARKET DISCIPLINE 7 Years Floating Rate Non- Convertible Subordinated Bond of Tk. 3,000 million: The bank
In line with Pillar III of Basel III, Bank prepared raised successfully Tk. 3,000 million Tier 2 capital in the form 7 year floating rate Subordinated
market discipline statements on yearly bond on February 19, 2015 through private placement after obtaining required approvals from
basis and submitted to Bangladesh Bank general shareholders, Bangladesh Securities and Exchange Commission and Bangladesh Bank.
accordingly. Bank also disclosed market
discipline in separate Annual Integrated 7 Years Floating Rate Non- Convertible Subordinated Bond of Tk. 5,000 million: To support
report page no. 123 and bank’s websites healthy business growth and ensure compliance with the Basel III capital accord in line with
Bangladesh Bank roadmap Bank Asia has completed all formalities further issuance of
7. RISK MANAGEMENT PAPER Subordinated Bond of Tk. 5,000 million as Tier 2 capital on 23 April 2017.
Risk Management Report for different risk
related issues are prepared and presented 10. CAPITAL PLANNING
to top management and submitted to Bank’s capital planning is a dynamic, ongoing and forward-looking mechanism to
Bangladesh Bank. On the basis of said incorporate changes in a banks strategic focus, risk tolerance levels, business plans, operating
paper, awareness was created regarding environment, or other factors that materially affect capital adequacy.
different risks. Capital planning assists the banks Board of Directors and senior management to:
i. identify risks, improve banks understanding of overall risks, set risk tolerance levels,
8. RISK BASED AUDIT
and assess strategic choices in longer-term planning,
In parallel to generic audit function, ii. identify vulnerabilities i.e. concentrations and assess their impact on capital,
the necessity of adoption of Risk Based iii. integrate business strategy, risk management, capital and liquidity planning decisions,
audit is increasing. The underlying audit have a forward-looking assessment of the bank’s capital needs, including capital needs
function is an effective tool for effective risk that may arise from rapid changes in the economic and financial environment.
management. Where typical audit process
primarily aim to identify irregularities Capital planning considers both short- term and long-term capital needs and is coordinated
among transactions/events which has with a bank’s overall strategy and business growth, usually with a forecast horizon of five years.
already occurred, the risk based audit is Bank capital planning include following components:
used to validate that the internal control Identifying and evaluating risks
environment is functioning as planned. Setting and assessing capital adequacy goals that relate to risk
Maintaining a strategy to ensure capital adequacy and contingency planning
9. CAPITAL MANAGEMENT OF BANK Ensuring integrity in the internal capital planning process and capital adequacy assessments.
Bank’s capital management framework
serves to ensure that the bank (both in solo 2015 2016 2017 2018 2019 2020
basis and consolidated basis) are able to full imple-
Implementation process
maintain adequate capital level. The bank mentation
capital management objectives are to: Minimum Total
Maintain sufficient capital resources 10.00% 10.00% 10.00% 10.00% 10.00% 10.00%
Capital
to meet minimum regulatory capital
requirements set by Bangladesh Capital
- 0.625% 1.25% 1.875% 2.5% 2.5%
Bank in accordance with Basel III Conservation Buffer
requirements Minimum Total
Maintain sufficient capital resources to 10.0% 10.625% 11.25% 11.875% 12.5% 12.5%
Capital plus buffer
support the bank’s risk appetite
Cover unexpected loss of the bank and 3%
Leverage Ratio 3% 3% Migration to Pillar I
support the bank’s credit rating Readjustment
Ensure the bank holds capital in excess Liquidity coverage ≥ 100%
of minimum requirements in order to ≥ 100% ≥ 100% ≥ 100% ≥ 100% ≥ 100%
ratio (fr Sept)
achieve the target capital adequacy
ratios set by management and Net stable funding ≥ 100%
>100% >100% >100% >100% >100%
approved by the board, to maintain ratio (fr Sept)
minimum adequacy in stress situation.
11. CAPITAL RELIEF BY REDUCING RISK
Raising Tier II capital In the year 2017, the Board of Directors and the Senior Management of the bank emphasized
Subordinated Non- Convertible Zero rigorously on corporate borrowers credit rating to lower our risk profile as well as to reduce the
Coupon Bond of Tk. 599.99 million: capital requirement of the bank. As a result of strong persuasion & drive, the number of valid
Bank issued 6 Years subordinated bond rated borrowers of the bank increased significantly in the year 2017 over 2016.
for Tk. 599.99 million on August 14 2012
for Tier II capital. Out of that Tier II capital
outstanding stood at Tk. 92.59 million on
December 31, 2017. The bond will be fully
redeemed on August 14, 2018.

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Non Funded automated VaR system for Foreign

Claim Risk Funded Exposure Exchange has already been developed.
BB Rating Exposure
Nature Weight The said system is used by Treasury
Exposure RWA Exposure RWA
Department of the bank.
Claims on 1 0.20 17,436.43 3,487.29 8,656.75 1,731.35
Corporate 2 0.50 37,883.55 18,941.77 24,873.00 1,2436.5 Process Re-engineering: Risk
(excluding Management Division has already
3,4 1.00 27,115.57 27,115.57 6,074.23 6,074.23
equity developed a system based duration gap
5,6 1.50 - - - - platform of Stress Testing as well as a full
exposure) Unrated 1.25 25,452.11 31,815.14 18,430.73 23,038.41 automated database for calculating Risk
SME 1 0.02 - - - - Weighted Asset part of Basel III.
SME 2 0.40 541.58 216.63 371.82 148.73
In addition to the above Risk Management
SME 3 0.60 9,523.96 5,714.37 884.47 530.68
Division of the bank has designed policy
SME 4 0.80 2,043.96 1,635.17 558.92 447.14 document for Early Alert System (EAS),
SME 5 1.20 - - - - Surveyor Enlistment Process etc.
Claims on SME 6 1.50 - - - -
13. CONCLUSION
SME Unrated (Small
enterprise & <BDT 0.75 3,686.26 2,764.69 114.37 85.77 Bank Asia continuously followed
3.00m) international standard regarding managing
Unrated (Small risk as specified by Bank for International
enterprise & <BDT 1.00 5,198.95 5,198.95 258.21 258.21 Settlement (BIS) in its core principles of
3.00m effective banking supervision specially
following along with others:
Total 128,882.37 96,889.58 60,222.50 44,751.02
Principle 15 – Risk management process
12. BORROWER’S RATING
Principle 16 – Capital adequacy
As prescribed by Bangladesh Bank, all banks in Bangladesh assessing credit risk under
standardized approach of the Risk based capital adequacy framework (Basel III) where Principle 17 – Credit risk
External Credit Rating Institutes (ECAIs) duly recognized by BB performs borrowers rating.
According to Credit rating of individual borrower, Risk Weighted Asset (RWA) is calculated for Principle 18 – Problem assets, provisions
assessing the Minimum Capital Requirement (MCR) under Pillar-I of Basel III and reserves

Key initiatives of 2017 Principle 19 – Concentration risk and large

Internal ICAAP: Risk Management Division of the bank has developed an assessment exposure limits
model for ICAAP (Internal Capital Adequacy Assessment Process). Currently all banks Principle 20 – Transactions with related
are following the common model which is provided from Bangladesh Bank. Central parties
Bank has suggested that each bank should develop and practice the internal ICAAP
model. Besides an internal system based platform has already been developed for the Principle 21 – Country and transfer risks
assessment of residual risk. In present calculation of residual risk is fully automated.
Principle 22 – Market risks
Risk Appetite: Risk Management Division of Bank Asia Ltd. has developed risk appetite Principle 23 – Interest rate risk in the
and management action trigger (MAT) for the bank. During the year 2017, Bank Asia banking book
Limited has considered new areas under risk appetite statement.
Principle 24 – Liquidity risk
Internal Client Rating Model: As part of adoption of advance approaches under credit
risk, Risk Management Division has developed a model for SME Rating. The said system Principle 25 – Operational risk
is under review stage. Besides RMD has already created a system based platform for the
Corporate Rating. The global economy continues to be
volatile and under stress, and our continued
Audit Automation: Risk Management Division has already taken an initiative for audit commitment to sound risk management
automation. A system based database has already developed in line with the calculation has proved to be effective as reflected in
of residual risk of ICAAP.
our strong capital and liquidity position. We
Committee Level Meeting(s): Risk Management Division is primary responsible to address recognize that maintaining and continually
different types of risk issues to Management and Board Level Committee(s). Considering enhancing our risk management
the same a number of meeting have been conducted by Risk Management Division capabilities will be critical in the months
during the year 2017. ahead to ensure that the bank’s financial
VaR (Value at Risk) for Equity: Risk Management Division has developed an automated and strategic objectives are achieved within
system for calculating the VaR for Capital market exposure. It is mentionable that an approved levels of risk appetite.

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Annual Disclosure for the year ended December 31, 2017

The public disclosure of prudential information is an important component of Basel Committee on Banking
Supervision’s framework of capital measurement and capital adequacy, known as Basel III. Bangladesh Bank has
specified the standard of disclosure through Guidelines on Risk Based Capital Adequacy (December 2010) which
revised in Basel III Guideline on December 2014 with effect from January 2015. The standard aims to enhance the
transparency in Bangladeshi financial market by setting minimum requirement for the disclosure of information on the
risk management practice and capital adequacy.

In line with the Bangladesh Bank BRPD Circular no. 35 of December 29, 2010 as to Guidelines on ‘Risk Based Capital
Adequacy for Banks’ and subsequent BRPD Circular 18 dated December 21, 2014 on ‘Guideline on Risk Based Capital
Adequacy’, following detailed qualitative and quantitative disclosures are provided in accordance with the central
bank directions covering scope of capital adequacy framework, capital of the bank, risk exposure and assessment
methodology, risk mitigation strategies and capital adequacy of the bank.

To cope up with the international best practices and to make the bank’s capital shock absorbent ‘Guidelines on Risk
Based Capital Adequacy (RBCA) for banks’ (Revised Regulatory Capital Framework in line with Basel II) was introduced
from January 01, 2009 as a parallel run with BRPD Circular No. 10, dated November 25, 2002 (Basel I). At the end of
parallel run, Basel II regime started from January 01, 2010 and the guidelines on RBCA came fully into force with its
subsequent supplements/revisions. After that, Bangladesh Bank issued ‘Guidelines on Risk Based Capital Adequacy
(RBCA) for banks’ (Revised Regulatory Capital Framework in line with Basel III) vide its BRPD Circular 18 dated
December 21, 2014 that Basel III reporting start from January 2015 and full implementation will start from January
2020. Instructions regarding Minimum Capital Requirement (MCR), Adequate Capital and Disclosure requirement as
stated in the guidelines had to be followed by all scheduled banks for the purpose of statutory compliance.

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1. SCOPE OF APPLICATION:
Qualitative Disclosures
a) The name of top corporate entity in
the group to which this guidelines BANK ASIA LIMITED
applies

The consolidated financial statements of the Bank include the financial statements of i) Bank
Asia Limited ii) Bank Asia Securities Limited iii) BA Exchange Company (UK) Limited. and iv) BA
Express USA Inc.
Bank Asia holds 99.99%, 100% and 100% shares of Bank Asia Securities Limited, BA Exchange
Company (UK) Limited and BA Express USA Inc. respectively.
The bank has an approved disclosure policy to observe the disclosure requirements set
out by the Bangladesh Bank and International Financial Reporting Standards (IFRS) and
International Accounting Standards (IAS) as adopted by the Institute of Chartered Accountants
of Bangladesh (ICAB) into Bangladesh Financial Reporting Standards (BFRS) and Bangladesh
Accounting Standards (BAS) where relevant to the bank.
A brief description of these institutions are given below:
Bank Asia Limited
Bank Asia Limited (“the Bank”) is one of the third generation private commercial banks (PCBs)
incorporated in Bangladesh on 28 September 1999 as a public limited company under the
Companies Act 1994, governed by the Banking Companies Act 1991. The Bank went for public
b) An outline of differences in the basis issue of its shares on 23 September 2003 and its shares are listed with Dhaka Stock Exchange
of consolidation for accounting and Limited and Chittagong Stock Exchange Limited. At present the Bank has 116 branches, 4 SME
regulatory purposes, with a brief centers and 132 own ATM booths. The Bank has three subsidiary companies namely, Bank
description of the entities within the Asia Securities Limited incorporated in Bangladesh, BA Exchange Company (UK) Limited
group: incorporated in United Kingdom and BA Express USA Inc. incorporated in USA. The Bank has
also an Offshore Banking Unit (OBU) at Chittagong Export Processing Zone, Chittagong.
(i) that are fully consolidated Bank Asia Securities Limited
(ii) that are given a deduction Bank Asia Securities Limited, a majority owned subsidiary company of Bank Asia Limited
treatment; and was incorporated as a private limited company in Bangladesh on 04 August 2010 bearing
certificate of incorporation no. C-86230/10 dated 04 August 2010 under the Companies Act
(iii) that are neither consolidated 1994 having its registered office at Hadi Mansion (7th Floor), 2 Dilkusha Commercial Area,
nor deducted (e.g. where the Dhaka 1000 which has commenced its business on the 17 April 2011.
investment is risk - weighted)
BA Exchange Company (UK) Limited
BA Exchange Company (UK) Limited was incorporated as a private limited company under
United Kingdom Companies Act and registered with Companies House of England and Wales
vide registration no. 07314397 as a fully owned subsidiary company of Bank Asia Limited,
BA Exchange Company (UK) Limited launched its operation in London on 16 May 2011. BA
Exchange Company (UK) Limited attaches a fresh width to the Bank’s remittance operation
and expands its global presence for remittance services. Bank Asia stretched its business in
United Kingdom through its wholly owned subsidiary to facilitate speedy and dependable
medium for remitting the hard-earned money of expatriates to home.
BA Express USA Inc.
BA Express USA Inc. is fully owned subsidiary company of Bank Asia Limited incorporated in
New York State Department of Financial Services (NYSDFS) in USA. The company obtained
license to receive money for transmission within USA and abroad and to transmit same,
pursuant to the provision of Article 13-B of the USA Banking Law, subject to all rules and
regulations made by the Superintendent of Financial Services of New York relating to such
business, effective November 22, 2013. The company has started its commercial operation
from June 01, 2014.

c) Any restrictions, or other major

impediments, on transfer of funds or Not applicable for the bank
regulatory capital within the group
d) The aggregate amount of surplus
capital of insurance subsidiaries
(whether deducted or subjected to an Not applicable for the bank
alternative method) included in the
capital of the consolidated group.

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2. CAPITAL STRUCTURE
Qualitative Disclosures
The composition of regulatory capital is different than accounting capital. In line with
Basel regime the structure of regulatory capital consists of Tier 1, Tier 2 & Tier 3. However
Summary information on the terms and the capital structure of Bank Asia Ltd consists of only Tier 1 and Tier 2 capital.
conditions of the main features of all Tier 1: Capital of Bank Asia Ltd consists of Paid up capital, statutory reserve, general
capital instruments, especially in the case reserve and retained earnings, Minority Interest.
of capital instruments eligible for inclusion
in Tier 1 or Tier 2. Tier 2: Capital of the bank consists of 50% revaluation reserve for fixed asset & securities,
subordinated debts and general provision.

Quantitative Disclosures

Million Taka
Sl Particulars Solo Consolidated
a) Tier-I (Core Capital)
a.1 Paid up capital 9,870 9,870
a.2 Non-repayable share premium account - -
a.3 Statutory reserve 7,345 7,345
a.4 General reserve 8 8
a.5 Retained earnings 1,677 1,554
a.6 Minority interest in subsidiaries - 0.012
a.7 Dividend equalization account - -
a.8 Others - -
a.9 Sub-Total (a.1 to a.8) 18,900 18,778
Less: Regulatory adjustments - -
a.10 Reciprocal crossholding in the CET - 1 Capital of Banking, Financial and Insurance Entities 47 47
a.11 Common Equity Tier -1 capital (Going-Concern Capital)/ Core Capital (a.9 - a.10) 18,853 18,730
a.12 Additional Tier 1 Capital - -
a.13 Total Tier- 1 Capital 18,853 18,730
b) Tier-II (Supplementary Capital) - -
b.1 General Provisions (provisions for unclassified loans + provision for Off-balance sheet exposure) 5,432 5,432
b.2 Asset revaluation reserves up to 50% 1,341 1,341
b.3 Subordinate debt 8,093 8,093
b.4 Other reserve - -
b.5 Sub-Total (b.1 to b.4) 14,866 14,866
Less: Regulatory adjustments - -
b.6 60 % of revaluation reserve for fixed assets, securities and equity securities 805 805
b.7 Total Tier- 2 Capital (b.5 - b.6) 14,061 14,061
c) Tier-III (Eligible for market risk only) - -
c.1 Short-term subordinated debt - -
c.2 Sub-Total (c.1 ) - -
d Total Eligible Capital (a.13+ b.7+ c.2) 32,914 32,792

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3. CAPITAL ADEQUACY
Qualitative Disclosures

Capital calculation approach

With regard to regulatory capital computation approaches (Minimum Capital Requirement) the bank
is following the prescribed approach of Bangladesh Bank. Below are risk wise capital computation
approaches that the bank is currently applying:
Credit Risk - Standardized Approach (SA)
Market Risk - Standardized Approach (SA)
Operational Risk – Basic Indicator Approach (BIA)
Capital of the Bank
In parallel to business growth, the bank is effectively manages its capital to meet regulatory requirement
considering the risk profile. Below are few highlights:
Currently Bangladesh Bank prescribed Minimum Capital Adequacy Ratio (MCR) is 10%, whereas as on
December 2017 the CRAR of the bank was 14.89%.
A summary discussion of
the Bank’s approach to During the same period Minimum Capital Requirement (MCR) of the bank was BDT 22,111.50 million
assessing the adequacy and eligible capital was BDT 32,914 million; i.e. the bank hold BDT 10,803 million surplus capital.
of its capital to support Reduction of Capital Requirement through increasing Rated Clients:
current and future
activities As per Basel-III norms capital adequacy i.e. buffer capital is a must for banks to protect the unexpected
losses against the risk profile and future business growth of the bank. Under the Standardized Approach
of the RBCA guidelines of Basel-III, counterparties credit rating are determined on the basis of risk profile
assessed by the External Credit Assessment Institutions (ECAIs) duly recognized by Bangladesh Bank
to derive risk-weights of exposures under the portfolio of claims. According to the guideline, the rated
exposures of a bank will reduce the Risk Weights and the regulatory capital requirement as well as create
the room to expand the business of the bank. This will also enable the bank to assess the creditworthiness
of the borrowers as well, to an acceptable level.
To withstand these challenges, the Board of Directors & the Senior Management of the bank emphasized
rigorously round the year 2017 on corporate borrowers credit rating to lower our risk profile as well as to
reduce the capital requirement of the bank. Accordingly, the Risk Management Division (RMD), CRO along
with the branches has taken all-out efforts to increase the number of corporate borrower’s exposures rated.
They are constantly taking the initiatives through guidance of the Senior Management; series of meetings,
correspondence, awareness program with the allied concerns i.e. branches of the bank & ECAIs. As a result
of strong persuasion & drive, significant number of rated clients increased in the year 2017 from the year
2016.

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Quantitative Disclosures
Million Taka
Sl. Risk Category Solo Consolidated
Details of Risk Weighted Assets (RWA)
a Credit Risk
a.1 On- Balance sheet 155,067 155,803
a.2 Off-Balance sheet 45,710 45,710
a.3 Total Credit Risk (a1+a2) 200,778 201,514
b Market Risk 3,519 3,519
c Operational Risk 16,818 17,316
Total RWA 221,115 222,349
Detail of Risk Wise Minimum Capital Requirement (MCR)
a Credit Risk
a.1 On- Balance sheet 15,507 15,580
a.2 Off-Balance sheet 4,571 4,571
a.3 Total Credit Risk (a1+a2) 20,078 20,151
b Market Risk 352 352
c Operational Risk 1,682 1,732
Total Minimum Capital Requirement 22,111 22,235
Total Maintained Capital 32,914 32,792
Total Capital Surplus 10,803 10,557
Detail of Tier wise Capital of the Bank
1 Tier-1 Capital 18,853 18,730
2 Tier-2 Capital 14,061 14,061
3 Tier-3 Capital - -
Total Capital 32,914 32,792
Total Capital to Risk Weighted Asset Ratio (CRAR) [Total capital/RWA] 14.89% 14.75%
Tier 1 CRAR [Tier 1 capital / RWA] 8.53% 8.42%

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4. CREDIT RISK:
Qualitative Disclosures
(a) The general qualitative disclosure requirement with respect to credit risk, including:
Bank classifies loans and advances (loans and bill discount in the nature of an advance) into performing and
non-performing loans (NPL) in accordance with the Bangladesh Bank guidelines in this respect.
An NPA (impaired) is defined as a loan or an advance where interest and/ or installment of principal remain
overdue for more than 90 days in respect of a Continuous credit, Demand loan or a Term Loan etc. except term
loan below Tk. 10 lac.
Classified loan is categorized under following 03 (three) categories:
> Sub-standard
> Doubtful
> Bad & Loss

Any continuous loan will be classified as:

i. ‘Sub-standard’ if it is past due/overdue for 03 (three) months or beyond but less than 06 (six) months.
ii. ‘Doubtful’ if it is past due/overdue for 06 (six) months or beyond but less than 09 (nine) months
iii. ‘Bad/Loss’ if it is past due/overdue for 09 (nine) months or beyond.

Any Demand Loan will be classified as:

i. ‘Sub-standard’ if it remains past due/overdue for 03 (three) months or beyond but not over 06 (six)
months from the date of expiry or claim by the bank or from the date of creation of forced loan.
ii. ‘Doubtful’ if it remains past due/overdue for 06 (six) months or beyond but not over 09 (nine) months
from the date of expiry or claim by the bank or from the date of creation of forced loan.
Definitions of past
iii. ‘Bad/Loss’ if it remains past due/overdue for 09 (nine) months or beyond from the date of expiry or claim
due and impaired (for
by the bank or from the date of creation of forced loan.
accounting purposes)
Term loan will be classified as:
(A) In case of any installment(s) or part of installment(s) of a Fixed Term Loan amounting upto Tk. 10.00 Lacs is
not repaid within the due date, the amount of unpaid installment(s) will be termed as ‘past due or overdue
installment’. In case of such types of Fixed Term Loans:

i. If the amount of past due installment is equal to or more than the amount of installment(s) due within 06
(six) months, the entire loan will be classified as ‘Sub-standard’’.
ii. If the amount of past due installment is equal to or more than the amount of installment(s) due within 09
(nine) months, the entire loan will be classified as ‘’Doubtful”.
iii. If the amount of past due installment is equal to or more than the amount of installment(s) due within 12
(twelve) months, the entire loan will be classified as ‘’Bad/Loss’’.

(B) In case of any installment(s) or part of installment(s) of a Fixed Term Loan amounting more than Tk. 10.00
Lacs is not repaid within the due date, the amount of unpaid installment(s) will be termed as ‘past due or
overdue installment’. In case of such types of Fixed Term Loans:

i. If the amount of past due installment is equal to or more than the amount of installment(s) due within 03
(three) months, the entire loan will be classified as ‘’Sub-standard’’.
ii. If the amount of past due installment is equal to or more than the amount of installment(s) due within 06
(six) months, the entire loan will be classified as ‘’Doubtful”.
iii. If the amount of past due installment is equal to or more than the amount of installment(s) due within 09
(nine) months, the entire loan will be classified as ‘’Bad/Loss’’.

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Qualitative Disclosures
Provision
Types of loans and advances
STD SMA SS DF BL
House finance 1% 2% 20% 50% 100%
> Description of
approaches followed Loans for professionals 2% 2% 20% 50% 100%
Consumer
for specific and general Other than housing finance & professionals to setup
allowances and statistical 5% 5% 20% 50% 100%
business
methods Provision for loan to broker house, merchant banks, stock dealers, etc 2% 2% 20% 50% 100%
Short-term agri-credit and micro credit 1% 1% 5% 5% 100%
Small and medium enterprise finance 0.25% 0.25% 20% 50% 100%
Others 1% 1% 20% 50% 100%
The Bank has a well structured delegation and sub-delegation of credit approval authority for ensuring good
governance and better control in credit approval system. The Board of Directors and its Executive Committee
hold the supreme authority for any credit approval in line with the credit committee consisting of the senior
management of the bank. Credit proposal processing, assessment of risks and mitigates there against,
placing before credit committee, seeking approval from the competent authority, assisting in completion of
documentation formalities and above all maintaining relationship with the branches and customers have
so long been done by Credit Risk Management (CRM). The function of CRM department has redefined by (i).
Credit Assessment, (ii). Credit Monitoring, (iii). Credit Information & Policy Development for smooth execution
of the credit risk management through segregating internal units. Separate segments for Corporate, Retail,
SME, Credit Cards have been formed in order to diversify the credit risk. Towards mitigating the risks, Bank Asia
has developed a robust credit approval system. Under the ongoing system, the approval and disbursement
of all business loans are centralized at Corporate Office. The credit proposals recommended by branches are
scrutinized by CRM Department. Sanctions are conveyed to the Branches after getting approval from Credit
Committee of Corporate Office or Board of Directors if needed. Limits are loaded into the system by Credit
Administration Department but it is not operative until the branch complies all the terms and conditions
incorporated in the sanction advice. The above arrangement ensures the segregation of duties & responsibilities
> Discussion of the Bank’s and thus minimizes the credit risk.
credit risk management
In the process of restructuring credit operation mechanism as per guidelines of BB, recently, a new division has
policy
been created namely “Corporate and Large Loan (C&LL)” to maintain a healthy credit portfolio by managing risk
at the portfolio level as well as at the individual transaction level. Credit proposal format is also redefined as it
is one of the key tools to maintain quality portfolio since its informs us risk, credit requirement, performance,
liability position, compliance, financial position, environmental issues, effective rate of return, details of business
etc. of the customer to mitigate credit risk.
The standardized approach is applied for risk weighting of exposure as per directive of Bangladesh Bank. It
requires banks to use risk assessment. The Bank is following Credit Risk Grading (CRG) manual for assessing a
borrower and making decisions of disbursing loans and advances/ investments while nominating the External
Credit Assessment Institutions (ECAIs) duly recognized by Bangladesh Bank to derive risk-weights of exposures
under the portfolio of claims. Maximum counterparty/group exposure are limited to 15% (funded) of the bank’s
capital base as stipulated by BB where a higher limit is required for projects of national importance subject
to prior approval of Bangladesh Bank. The single borrower exposure limit has been increasing day by day of
the bank with the increase of the total capital of the bank. But the management of the bank is exercising the
prudential limit to a single borrower in order to minimize concentration risk of the bank considering the security
coverage, satisfactory performance, credit risk grading status, earning potentials, capital requirement, etc.
against the limit.

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Quantitative Disclosures
Amount in BDT Million

Particular Outstanding
b) Total gross credit risk exposures broken down by major types of credit exposure 197,504
Chief Executives & Others senior executives 142
Agriculture 4,075
Industry 96,610
Constructions 5,281
Power, Gas, Water and Sanitary Services 2,023
Transport, Storage and Communication 2,824
Trade Services 34,741
Housing Services 13,883
Banking and Insurance 7,179
Professional and Misc. services 30,748
c) Geographical distribution of exposures, broken down in significant areas by major types of credit
exposure 197,504
Dhaka Division 158,640
Chittagong Division 28,007
Khulna Division 3,348
Rajshahi Division 3,562
Barisal Division 564
Sylhet Division 2,265
Rangpur Division 805
Mymensingh Division 314
d) Industry or counterparty type distribution of exposures, broken down by major types of credit
exposure. 197,358
Agriculture 4,075
Food Manufacturing 10,907
Beverage industry 747
Tobacco industry 312
RMG industry 22,666
Textile industry 20,275
Wood cork and allied products 42
Furniture and Fixture 156
Paper and paper products 8,648
Leather and leather products 2,073
Rubber products 2,355
Chemical and chemical products 1,633
Basic metal products 6,225
Electrical machinery and apparatus 3,795
Other manufacturing industries 13,468
Ship building 2,080
Ship breaking 760

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Particular Outstanding
Pharmaceutical 467
Constructions 5,280
Power, Gas, Water and Sanitary Services 2,023
Transport, Storage and Communication 2,823
Trade Services 34,740
Housing Services 13,882
Banking and Insurance 7,178
Professional and Misc. services 30,748
e) Residual contractual maturity breakdown of the whole portfolio, broken down by major types of
credit exposure 197,504
Repayable on demand 28,256
Not more than 3 months 34,402
More than 3 months but not more than 1 year 48,521
More than 1 year but not more than 5 years 57,693
More than 5 years 28,630
f) By major industry or counterparty type
Sector wise past due loan classification categories:
Sub- Standard 486
Doubtful 705
Bad and Loss 7,451
Total 8,642
Specific and general provisions 7,841
Total General Provision: 4,090
Total Specific Provision: 3,751
g) Gross Non Performing Assets ( NPAs) 8,642
Non Performing Assets ( NPAs) to Outstanding Loans Advances 4.38%
Movement of Non Performing Assets ( NPAs)
Opening balance 8,847
Additions 8,534
Reductions (8,739)
Closing balance 8,642
Movement of specific provisions for NPAs
Opening balance 4,494
Less: Transferred to General Provision -
Less: Write-off (2,023)
Add: Recovery from previously written off 34
Transfer from General Provision -
Add: Provisions made during the period 1,234
Closing balance 3,739

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5. EQUITIES: DISCLOSURES FOR BANKING BOOK POSITIONS

Qualitative Disclosures
Differentiation between holdings on
which capital gains are expected and
Investment in equity mainly for capital gain purpose but Bank has some investment for
those taken under other objectives
relationship and strategic reasons.
including for relationship and strategic
reasons
The equity markets are traditionally volatile with a high-risk, high-returns profile. As
such investors in the equity market have to plan and strategize to reduce their risks and
increase their returns. Equity investments must therefore go hand in hand with a good risk
management plan in place. In an uncertain marketplace like the present, investor cannot
afford to place all hope in only one thing. Therefore, it is very important to protect the total
investment value by means of diversification.

Bank Asia has been operating in the capital market of Bangladesh since 2009. The Bank
invested in shares both in primary as well as secondary market. Bank Asia has been started
its own portfolio operation from May 04, 2010. Since then the Bank was mainly involved in
“Own Portfolio Management” activity.

Investments in shares of Bank Asia are made with judgment and care, under
circumstances then prevailing, which persons of prudence, discretion and intelligence
Discussion of important policies covering exercise in the management of their own affairs, not for speculation, but for investment,
the valuation and accounting of equi- considering the probable safety of capital as well as the probable income to be derived.
ty holdings in the banking book. This The Bank recognizes that no investment is totally free from risk and that occasional
includes the accounting techniques and measured losses are inevitable in a diversified portfolio and will be considered within the
valuation methodologies used, including context of the overall portfolio’s return, provided that adequate diversification has been
implemented and that the sale of a security is in the best interest of the Bank.
key assumptions and practices affecting
valuation as well as significant changes in The Management of the Bank has constituted an Investment Committee / team
these practices. comprising of members from the senior executives of the Bank who have sound
experiences and knowledge on Capital Market activities.

Investment team of Bank Asia reviews status of the own portfolio investment on regular
basis and follows top-down approach where they review and analyze economy outlook,
sectoral growth and specific company analysis. Company specific risk is minimized
through proper diversification. To manage market risk, we follow economic research.
Moreover, it has been noted that, the major source of market risk comes from the
frequent change of regulation. Thus, it is important to maintain close relationship with the
regulatory body and keep aware if there is any upcoming regulation change.

Our investment in shares are being monitored and controlled by the Investment
Committee are reflected in accounts through proper methodologies and accounting
standards of the local & international. Investments are valued on mark to mark basis
on a particular period.

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Quantitative Disclosures

Amount in BDT Mln.

Sl. Particular
a) a) Value disclosed in the balance sheet of investments, as well as the fair value of those investments; for Not Applicable
quoted securities, a comparison to publicly quoted share values where the share price is materially different
from fair value:
b) The cumulative realized gains (losses) arising from sales and liquidations in the reporting period Nil
c) Total unrealized gains (losses) Nil

Total latent revaluation gains (losses) Nil

Any amounts of the above included in Tier 2 capital. Nil

d) Capital requirements broken down by appropriate equity groupings, consistent with the bank’s methodolo-
gy, as well as the aggregate amounts and the type of equity investments subject to any supervisory provi-
sions regarding regulatory capital requirements.
d.1 Specific Risk 119
d.2 General Market Risk 119
d3. Total (d1+d2) 238

6. INTEREST RATE RISK IN THE BANKING BOOK

Qualitative Disclosures
Interest rate risk is the potential that the value of the On Balance Sheet and the Off Balance
Sheet position of the Bank would be negatively affected with the change in the Interest
rate. The vulnerability of an institution towards the advance movement of the interest rate
The general qualitative disclosure
can be gauged by using Duration GAP under Stress Testing Analysis.
requirement including the nature of
IRRBB and key assumptions, including
Bank has also been exercising the Stress Testing using the Duration GAP for measuring the
assumptions regarding loan prepayments
Interest Rate Risk on its On Balance Sheet exposure for estimating the impact of the net
and behavior of non-maturity deposits,
change in the market value of equity on the Capital Adequacy Ratio (CAR) due to change in
and frequency of IRRBB measurement
interest rates only on its On Balance Sheet position (as the Bank holds no interest bearing
Off Balance Sheet positions and or Derivatives). Under the assumption of three different
interests rate changes i.e. 1%, 2% and 3%.
Amount in BDT Mln.

Quantitative Disclosures
Sl. Particular
1 Market Value of Assets 278,900
2 Market Value of Liabilities 251,600
3 Weighted Average of Duration of Liabili-ties (DL) in years 1.13
4 Weighted Average of Duration of Assets (DA) in years 1.27
5 Duration GAP (DA-DL) in years 0.25
6 Yield to Maturity (YTM -Assets) 11.38%
Yield to Maturity (YTM -Liability) 4.37%
Magnitude of Interest Rate Change 1% 2% 3%

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Quantitative Disclosures
Sl. Particular
7 Fall in Market Value of Equity (630) (1,260) (1,900)
Stress Testing Minor Moderate Major
8 Regulatory capital (after shock) 32,260 31,630 31,000
9 RWA (after shock) 220,551 219,930 219,290
10 CRAR (after shock) 14.63% 14.38% 14.14%

7. MARKET RISK
Qualitative Disclosures
The Board approves all policies related to market risk, sets limits and reviews compliance
Views of BOD on trading/ investment
on a regular basis. The objective is to provide cost effective funding last year to finance
actives
asset growth and trade related transaction.
Standardized approach has been used to measure the market risk. The total capital
requirement in respect of market risk is the aggregate capital requirement calculated
Methods used to measure Market risk for each of the risk sub-categories. For each risk category minimum capital requirement
is measured in terms of two separately calculated capital charges for ‘specific risk’ and
‘general market risk’.
The Treasury Division manage market risk covering liquidity, interest rate and foreign
exchange risks with oversight from Asset-Liability Management Committee (ALCO)
Market risk Management system
comprising senior executives of the Bank. ALCO is chaired by the Managing Director. Alco
meets at least once in a month.
There are approved limits for Market risk related instruments both on-balance sheet
and off-balance sheet items. The limits are monitored and enforced on a regular basis
Policies and process for mitigating
to protect against market risks. The exchange rate committee of the Bank meets on a
market risk
daily basis to review the prevailing market condition, exchange rate, forex position and
transactions to mitigate foreign exchange risks.
Amount in BDT Million

Quantitative Disclosures
Particular
The capital requirement for:
Interest Rate Risk -
Equity Position Risk 238
Foreign exchange 114
Commodity Risk -
Total capital requirement against Market Risk 352

8. OPERATIONAL RISK
Qualitative Disclosures
The policy for operational risks including internal control & compliance risk is approved by the board
Views of BOD on system to
taking into account relevant guidelines of Bangladesh Bank. Audit Committee of the Board oversees
reduce Operational Risk
the activities of Internal Control & Compliance Division to protect against all operational risk.
Bank has a policy to provide competitive package and best working environment to attract and
Performance gap of executives
retain the most talented people available in the industry. BA’s strong brand image plays an important
and staffs
role in employee motivation. As a result, there is no significant performance gap.

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Basel III Pillar 3
Market Discipline

Qualitative Disclosures
Potential external events No potential external event is expected to expose the Bank to significant operational risk.
Operational risk, defined as any risk that is not categorized as market or credit risk, is the risk of loss
arising from inadequate or failed internal processes, people and systems or from external events. It
is inherent in every business organization and covers a wide spectrum of issues. In order to miti-
gate this, internal control and internal audit systems are used as the primary means. The Bank Asia
Limited manages this risk through a control based environment in which processes are documented,
authorization is independent and transactions are reconciled and monitored. This is supported by an
independent program of periodic reviews undertaken by internal audit, and by monitoring external
operational risk events, which ensure that the bank stays in line with industry best practice and takes
account of lessons learned from publicized operational failures within the financial services industry.
Policies and processes for miti- Bank Asia Limited has operational risk management process which explains how the bank manages
its operational risk by identifying, assessing, monitoring, controlling and mitigating the risk, rectifying
gating operational risk
operational risk events, and implementing any additional procedures required for compliance with
central bank requirements. Operational risk management responsibility is assigned to different level
of management within the business operation. Information systems are used to record the identifica-
tion and assessment of operational risks and to generate appropriate regular management reporting.
Risk assessment incorporates a regular review of identified risks to monitor significant changes.

On top of that, as part of recent development, the bank is in the process of adoption of globally
recognized operational risk assessment tools, e.g. Risk Control Self Assessment for assessment of all
possible operational risk and adoption of Key Risk Indicator (KRI) to help the bank to set operational
risk trigger parameters.
Approach for calculating capi- Basic Indicator Approach was used for calculating capital charge for operational risk as of the report-
tal charge for operational risk ing date.
Amount in BDT Million

Particular Solo Consolidated

Capital Requirement for Operational Risk under MCR 1,682 1,730

9. LIQUIDITY RATIO
Qualitative Disclosures
Liquidity risk is the risk that a given security or asset cannot be traded quickly enough in the mar-
ket to prevent a loss (or make the required profit) or when a bank is unable to fulfill its commit-
ments in time when payment falls due. Thus, liquidity risk can be of two types:

a) Funding liquidity risk: The risk that a firm will be unable to meet its current and future cash
flow and collateral needs without affecting its daily operations or its financial condition
Views of BOD on system to
b) Market liquidity risk: The risk that a firm cannot easily offset or sell a position without incur-
reduce liquidity Risk
ring a loss because of inadequate depth in the market

Banking organization, where off-balance sheet exposure is significant or has strong dependen-
cy on corporate deposit or experiencing step asset (i.e. primarily credit portfolio or investment
book) growth is exposed to high level of Liquidity risk. Liquidity risk should not be seen in isola-
tion, because financial risks are not mutually exclusive and liquidity risk is often triggered by con-
sequence of other financial risks such as credit risk, interest rate risk, foreign exchange risk etc.

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 Basel III Pillar 3
Market Discipline

Qualitative Disclosures
In context of Pillar 3 (Supervisory Review Process) of RBCA, the necessity of proper assessment
and management of liquidity risk carries pivotal role in ICAAP of banks. In the perspective of
Bangladesh, identifying and monitoring the driving factors of liquidity risk is viewed from the
following aspects:

Regulatory Liquidity Indicators (RLIs):

Cash Reserve Requirement (CRR)
Statutory Liquidity Ratio (SLR)
Medium Term Funding Ratio (MTFR)
Maximum Cumulative Outflow (MCO)
Methods used to measure Advance Deposit Ratio (ADR)/Investment Deposit Ratio (IDR)
Liquidity Risk Liquidity Coverage Ratio (LCR)
Net Stable Funding Raito (NSFR)

Bank’s own liquidity monitoring tools:

Wholesale Borrowing and Funding Guidelines
Liquidity Contingency Plan
Management Action Trigger (MAT)

Computation of Capital Charge against Liquidity Risk: If annual average of any RLIs of any bank
falls bellow Bangladesh Bank’s requirement the bank will be required to maintain additional
capital for that RLI (or those RLIs).
As per Bangladesh Bank guideline management maintain sufficient CRR and SLR.

Liquidity Risk Management In December 2014, the Bangladesh Bank started to two new liquidity metrics as part of the
System implementation of Basel III. These are a short term liquidity stress metric, the Liquidity Coverage
Ratio (LCR), and a longer term funding metric, the Net Stable Funding Ratio (NSFR). Banks have to
maintain LCR and NSFR are at a minimum of 100%.
Bank Asia Limited Asset-Liability Management Committee (ALCO) has responsibility for monitor-
Policies and processes for ing liquidity measures and limits. Liquidity is maintained in excess of the maximum cumulative
mitigating liquidity risk outflows calculated within these stress tests. Board Risk Management Committee set policies and
process to mitigate all risks including Liquidity risk.

Amount in BDT Million

Particular
Liquidity Coverage Ratio (LCR) 109.32%
Net Stable Funding Ratio (NSFR) 105.92%
Stock of High quality liquid assets 41,568
Total net cash outflows over the next 30 calendar days 38,024
Available amount of stable funding 220,486
Required amount of stable funding 208,155

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Basel III Pillar 3
Market Discipline

10. LEVERAGE RATIO

Qualitative Disclosures
In order to avoid building-up excessive on and off-balance sheet leverage in the banking system, a
simple, transparent, non-risk based leverage ratio has been introduced by Bangladesh Bank. The
leverage ratio is calibrated to act as a credible supplementary measure to the risk based capital re-
quirements. The leverage ratio is intended to achieve the following objectives:
Views of BOD on system to a) constrain the build-up of leverage in the banking sector which can damage the broader financial
reduce excessive leverage system and the economy
b) reinforce the risk based requirements with an easy to understand and a non-risk based measure
The policy for Leverage Ratio including on and off balance sheet exposure and capital related policy.
The Bank has a well structured delegation and sub-delegation of credit approval authority for ensur-
ing good governance and better control in credit approval system. The Board of Directors and its Exec-
utive Committee hold the supreme authority for any credit approval in line with the credit committee
consisting of the senior management of the bank.
Policies and processes for
There are approved limits for instruments both on-balance sheet and off-balance sheet items. The
managing excessive on and off
limits are monitored and enforced on a regular basis to protect against such risk.
balance sheet leverage
Calculation of Leverage Ratio
A minimum Tier 1 leverage ratio of 3% is being prescribed both at solo and consolidated level.

Tier 1 Capital (after related deductions)

Leverage Ratio =
Total Exposure (after related deductions)
The exposure measure for the leverage ratio will generally follow the accounting measure of exposure.
Approach for calculating In order to measure the exposure consistently with financial accounts, the following will be applied by
exposure the bank:
i. On balance sheet, non-derivative exposures will be net of specific provisions and valuation
adjustments (e.g. surplus/ deficit on available for sale (AFS)/ Held-for-trading (HFT) positions).
ii. Physical or financial collateral, guarantee or credit risk mitigation purchased is not allowed to
reduce on-balance sheet exposure.
iii. Netting of loans and deposits is not allowed.

Amount in BDT Million

Particular Solo Consolidated
Tier-1 Capital (A) 18,853 18,730
Exposure measure :
On balance sheet exposure 285,257 287,206
Off balance sheet exposure 65,019 65,019
Less: Regulatory adjustment made to Tier I capital 47 47
Total exposure (B) 350,229 352,178
Leverage Ratio (A/B) 5.38% 5.32%

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 Basel III Pillar 3
Market Discipline

11. REMUNERATION
Qualitative Disclosures
Name, composition and mandate of the main body overseeing remuneration:
Managing Director, Senior Management Team (SMT) & Head of People Management Division (PMD)
governs the remuneration related policies and practices in alignment with the bank’s short & long
term objectives. They play an independent role, operating as an overseer; and if required, make
recommendation to the Board of Directors of the Bank for its consideration and final approval for
any remuneration related policy. The main work includes presenting recommendations to the
Board regarding remuneration, compensation packages of Senior Management, incentive schemes
and retirement benefits. They also assist the Board of Directors to ensure that all employees are
remunerated fairly and get performance-based compensation by ensuring effective remuneration
policy, procedures and practices aligned with the Bank’s strategy and applied consistency for all
employee levels.
A description of the scope of the bank’s remuneration policy (e.g. by regions, business lines),
including the extent to which it is applicable to foreign subsidiaries and branches:
a. Information relating to Remuneration Committee of Bank Asia also oversee its two foreign subsidiary i.e. BA Exchange
the bodies that oversee Company (UK) Limited and BA Express USA Inc. and one local subsidiary i.e. Bank Asia Securities
remuneration. Limited.
A description of the types of employees considered as material risk takers and as senior managers,
including the number of employees in each group:
Risk Takers are senior employees who can take, or influence the taking of material risk for Bank Asia
or for a material business unit.

Designation No of Employee
President and Managing Director 01
Deputy Managing Director 03
Senior Executive Vice President 07
Executive Vice President 11
Senior Vice President 08

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Basel III Pillar 3
Market Discipline

Qualitative Disclosures
Key features of remuneration policy :
We target a fair human resources management by using a performance-based system. Our salary
policy is the same in all branches and service points for the beginner level. In addition, to drive
further development of individual skill sets and competencies, speaking foreign languages is
compensated. There is no incidence of gender discrimination in terms of remuneration.
Bank Asia compensation program focuses on individual short-term goals vis-a-vis long-term
success and overall profitability of the Bank. Both our short-term annual incentive and long-term
compensation plans promote our pay-for-performance philosophy, as well as our goal of having a
meaningful amount of pay at-risk, and we believe both plans provide us a competitive advantage in
the acquisition and retention of talents.
Objectives of remuneration policy :
The overall objective of the Bank’s remuneration policy is to establish a framework for attracting,
retaining and motivating employees, and creating incentives for delivering long-term performance
within established risk limits. Performance is judged, not only on what is achieved, but also on how
it is achieved as well as alignment with the Bank’s values.
b. Information relating to the
design and structure of Whether the remuneration committee reviewed the firm’s remuneration policy during the past year,
remuneration processes. and if so, an overview of any change that was made:
The remuneration committee reviewed the firm’s remuneration on 2014 and revised the
remuneration by conducting a survey considering the following facts:
Oversee Bank’s remuneration position and revise the structure according to the competitive
market
Align compensation strategy with business strategy
Determine the percentage of increment at each job grade
Get acquainted with inflation in the economy
Based on the survey, Banks changes the remuneration on Compa-Ration based of its existing
employees
A discussion of how the bank ensures that employees dealing with risk and its compliance are
remunerated independently of the businesses they oversee :
Control function of internal control and compliance directly responds of Audit Committee of the
Board and dotted report to the President and Managing Director. Credit Risk Officer reports to
President and Managing Director directly.

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 Basel III Pillar 3
Market Discipline

Qualitative Disclosures
An overview of the nature and type of the key measures used to take account of these risks,
including risks difficult to measure (values need not be disclosed):
A balanced scorecard approach has been adopted by the Board with real-life SMART KPI to evaluate
the contribution of all individuals in a transparent manner to assess quantitative and/or qualitative
performance vis-a-vis set target of a given year. We have infused 80/20 strategy in performance
measurement system; as such 80% Objective and 20% Organizational & Personnel behavior factors.

a. Description of the ways in A discussion of the ways in which these measures affect remuneration:
which current and future The way in which each individual contributes to or impacts on the key criteria differs depending
risks are taken into account on the area of the business/target activities in which they operate and nature of activities specified
in the remuneration by the management. These differences are reflected in the expected outcomes and performance
processes. indicators developed for each individual employee/role and satisfactory performance against
these indicators is required to qualify for annual increment of remuneration, performance bonus,
promotion and other benefits.
A discussion of how the nature and type of these measures has changed over the past year
and reasons for the change, as well as the impact of changes on remuneration:
Since the implementation of real-life SMART KPI to evaluate the contribution of all individuals, no
change has been taken place.
An overview of main performance metrics for bank, top-level business lines and individuals:
Bank Asia is solely depending on the contribution of its existing talents. From the year 2013, Bank
Asia introduced a real-life SMART KPI to evaluate the contribution of all individuals in a transparent
manner to assess quantitative and/or qualitative performance vis-a-vis set target of a given year.
We have infused 80/20 strategy in performance measurement system; as such 80% Objective and
20% Organizational & Personnel behavior factors are introduced. The benefits of using KPI are the
followings:
Reduce the number of decisions and make decisions based on objectivity and facts.
b. Description of the ways in Quantify the achievement of goals
which the bank seeks to Focus on facts and see where individual improvement is/are needed.
link performance during a As individual initiative grows, it becomes more difficult to remain as close to the operational
performance measurement details as it is, in such case, KPI results can bring back to reality.
period with levels of Employees are clear about his/her obligations to deliver during the year and accordingly would
remuneration. be able to plan to meet the expectation.
Last but not the least, unbiased performance evaluation at the end of the year.
A discussion of how amounts of individual remuneration are linked to bank-wide and
individual performance:
Yearly performance bonus, salary increment, staff house building loan are directly linked with
employee’s individual performance.
A discussion of the measures the bank will in general implement to adjust remuneration in
the event that performance metrics are weak.
Variance performances like performance bonus, salary increment are determined by the outcome
of scorecard in prescribed KPI of the individual.
c. Description of the ways
in which the bank seeks
Bank Asia provides its Employees incentive compensation delivered in the form of deferred cash
to adjust remuneration to
awards, subject to performance based on Key Performance Indicators (KPI).
take account of longer-term
performance.

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Basel III Pillar 3
Market Discipline

Qualitative Disclosures
A summary of Short-term and Long-term compensation plan are given below:
Total Compensation = Fixed Pay (Salary)+Variable Pay (Bonus)+Variable Pay (Long term incentive)
Form of variable remuneration offered by Bank Asia:
Cash Form:
Short-Term Incentives / Rewards
1. Yearly fixed and incentive bonus;
2. Yearly Increment;
3. Business accomplishment financial award;
4. Special Increment for especial assignments/accomplishment;
5. Car, fuel and car maintenance allowance for executives;
6. Cash Risk allowance for cashier;
7. Charge allowance for Head of Branches
Long-Term Incentives / Rewards
d. Description of the
different forms of variable 1. Provident fund;
remuneration that the bank
utilizes and the rationale for 2. Gratuity;
using these different forms.
3. Benevolent fund
4. Employee house building loan with minimum interest rate
5. Provident fund loan with minimum interest rate
6. Periodically salary review (enhancement)
7. Furniture allowance for executives
8. Yearly professional membership fees for professional certificates holder
Non-Cash Form:
Short-Term Incentives / Rewards
1. Medical insurance coverage for self, wife and two children;
2. Accelerates promotion for top talents;
3. Study leave
Long-Term Incentives / Rewards
1. Foreign training award;

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 Basel III Pillar 3
Market Discipline

Qualitative Disclosures
Particular Amount in BDT Million

a. Number of meetings held by the main body overseeing remuneration during the Meeting regarding overseeing the
financial year and remuneration paid to its member. remuneration was held on need basis.
No. Amount
b. Number and total amount of guaranteed bonuses awarded made during the
financial year. Nil
Number and total amount of sign-on awards made during the financial year. Nil
Number and total amount of severance payments made during the financial year
Nil
c. Total amount of outstanding deferred remuneration, split into cash, shares and Nil
share-linked instruments and other forms.
Total amount of deferred remuneration paid out in the financial year. Nil

d. Breakdown of amount of remuneration awards for the financial year to show:

Breakdown of Remuneration is as
follows(Taka in million):
- fixed and variable
Basic salary 931
Allowances 960
Festival bonus 150
Gratuity 152
Provident fund contribution 87
Performance bonus 240
Total : 2,520

Nil
- deferred and non-deferred.
All the remunerations are provided in the form
- different forms used (cash, shares and share linked instruments, other forms).
of cash
e. Quantitative information about employees’ exposure to implicit (e.g. fluctuations
in the value of shares or performance units) and explicit adjustments (e.g. claw
backs or similar reversals or downward revaluations of awards) of deferred
remuneration and retained remuneration:

Total amount of outstanding deferred remuneration and retained remuneration

exposed to ex post explicit and/or implicit adjustments. Nil

Total amount of reductions during the financial year due to ex post explicit
adjustments. Nil

Total amount of reductions during the financial year due to ex post implicit
adjustments. Nil

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144
 Date Particulars
Sep.28, 1999 Obtained Certificate of incorporation and Certificate of Commencement of
business
Oct.6, 1999 Obtained Banking License
Nov.27,1999 Inauguration of Bank
Feb.16, 2001 Acquisition of Bangladesh operation of Nova Scotia of Canada
Jan.1, 2002 Acquisition of Bangladesh operation of Muslim Commercial Bank (MCB) of Pakistan
Apr.1,2003 Started Online Banking Operations
Jan 6,2004 Listed with Dhaka Stock Exchange (DSE) and Chittagong Stock Exchange (CSE)
Dec.24,2008 Started Islamic Banking Operation
July 10, 2010 Started CTSU to facilitate Non-AD branches foreign trade operations
Apr.17,2011 Bank Asia Securities Ltd. (BASL) started capital market operation
May16, 2011 Started operation of BA Exchange Company (UK) Ltd. In London
Jan.12, 2012 Ektee Bari Ektee Khamar (EBEK) initiated to serve the unbanked population
October 7, 2013 Awarded as the first Bangladeshi Bank with GRI certification for its Sustainability
Reporting
Feb19,2015 Successfully issued of Tk. 3,000 million 7 year Non-convertible Subordinated Bond
Dec.4, 2013 Agent banking started its operation for strengthening the ongoing financial
inclusion program
June 1, 2014 Started operation of the 2nd overseas company in USA, BA Express USA Inc. at NY,
USA
Feb 2, 2014 Obtained registration of Bank Asia Foundation
June 27,2015 Country’s first School Banking service started through Agent Banking outlet
Aug 5, 2016 Unveiled the plaque of construction work of Bank Asia’s own Building
Aug 14, 2016 Introduced TAB based digital SME & Agri proposal processing service named
DIGANTA OCAS (online credit approval system) for the first time in the banking
industry
Aug 17,2016 Introduced A-Card (Agricultural Card) for first time in Bangladesh to facilitate
marginal farmers to get agri-loan in card
Dec 20, 2016 Inaugurates Bank Asia’s own 6 storied Training Institute
Apr 23, 2017 Issuance of Tk. 5,000 million 7 year Non-convertible Subordinated Bond-3
Dec 27, 2017 Launching Bank Asia 1st Mutual Fund of Tk. 1,000 million

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145
 Summary
Sustainability
Report
E-Wastage is inviting
grave danger to our
environment
The content below gives an
overview of the locations of
Summary Sustainability Report

Achievement for Sustainability Report 148

Sustainable Banking Operations Key Highlights 2017 149
Message from President and Managing Director 151
Report Parameter 152
Triple Bottom Line 152
Strategic Focus for Sustainability 153
Corporate Profile 154
Primary Brands, Products & Services 156
Advertisements Regarding integrity 161
Stakeholders’ Engagement 162
Material Aspects and Boundaries 165
Environmental Performance 166
Economic Performance 170
Our Business Model 175
Social Safety Net Programs 176
Sustainable HR Development 178
Bank Asia Foundation 184
Corporate Social Responsibility 185
Customer Satisfaction Survey 188
Stakeholders Relationship/Grievance Redressal 192

Bank Asia Limited

146
Annual Integrated Report 2017
147
 Achievement for
Sustainability Report

Bank Asia produces separate full scale Sustainability Report every year
following GRI Guidelines including GRI Content Index and page reference.
For more details visit : www.bankasia-bd.com

Bank Asia achieved Sustainability Reporting Awards (SRA) by NCSR

(National Centre for Sustainability Reporting), Jakarta, Indonesia
‘Winner-Best Sustainability Report in Overseas category’ - 13th SRA 2017 for Sustainability Report 2016
Best Sustainability Report in Bangladesh - 12th SRA 2016 for Sustainability Report 2015
Best Sustainability Reporting Award 2015, Runner up 1 in Overseas Category for Sustainability Report 2014
Sustainability Reporting Award 2014 (SRA 14) for Most Impressive Report 2013 for Sustainability Report 2013
Sustainability Reporting Award 2013 (SRA 13) for Most Progressive Report 2012 for Sustainability Report 2012
Commendation for the first time - 9th SRA for Sustainability Report 2012

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Sustainable Banking
Operations
Key Highlights 2017

61
Districts covered 1,497 agent 61,095
outlets for expanding Agent Man Hours of training for
Banking in most development of our
geographically dispersed human capital
poor segment

873
Students received support 1,629,286 63%
Cash transactions
for education under BA’s
Unbanked villagers through 23,206 done through
higher studies scholarship
ATM
amounting to Tk. 25.54 samitee came under Bank Asia’s
million. Total beneficiary banking service network by EBEK
so far 1,950 project for
poverty alleviation

Tk.1,678 million 92,981

Financed to a Green Financing
E-statements delivered
(LEED Platinum
Certified) Project 92,139
Farmers and rural people
to customer

(in 2017) so far 580,657

beneficiary benefitted
financially through
our agricultural/
rural credit
-

1,26,597
Households of rural and

Tk.425 million(approx)
semi-urban areas received
remittance of Tk. 3,798 million
through our MFIs
network business
more than 1,13,257 transactions
have done through Bank Asia
SMART APP, an integrated
internet and mobile
banking solution

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149
 Message from the President
and Managing Director

Bank Asia Limited

150
In today’s complex business world, the 2017, Bank Asia spent an amount of Tk. to share with utmost pleasure that Bank
financial sector is expected to play a 183.83 million for several CSR activities. Asia achieved award for Best Sustainability
progressive role in supporting different A significant amount was given to poor Report in Overseas catagory in the 13th
national and international goals to meritorious students under Higher Sustainability Reporting Awards (SRA)
facilitate the transition to a green and low Study Scholarship Program to build up 2017 by NCSR, Jakarta, Indonesia for
carbon economy. In line with this thought, skilled future humans, infrastructural our Sustainability Report 2016. This
Bank Asia highlights the performance in development of different institutes is noteworthy that we are achieving
areas that have been able to create major including BSMMU and support to disaster sustainability award every year under
economic, environmental and social management. different category by NCSR.
impact in Annual Integrated Report 2017.
Additionally, the bank is on the move to Bank Asia always believes that a skilled Together with our concerted effort,
publish its 6th Sustainability Report 2017 workforce is the prerequisite to operate an dedication of our employees and the
based on upgraded G4 guidelines. efficient banking operation which is also continuous support of our stakeholders
vital to boost up profitability along with we look forward to pay back more for our
By forming a unique and flexible agent sustainable finance. In this connection, sustainable commitment with a sense of
banking module patronized by advanced a robust emphasis has been placed in optimism and firm belief. At last, I express
technologies, Bank Asia reached to personnel development as well as creation my sincere thanks and gratitude to all
remote areas with 1,497 agent outlets of future leaders under Future Leadership stakeholders and honestly acknowledge
covering 62 districts and 298 upazillas Development Program (FLDP) through their active engagement towards Bank
across Bangladesh. Ektee Bari Ektee advanced and latest training. In 2017 we Asia’s vision to contribute to a poverty free
Khamar (EBEK) is a government poverty have provided 61,095 man hours training Bangladesh.
eradication project for the ultra-poor to 2,611 participants on different aspects
people of our country where Bank Asia including sustainable financing.
has been supporting through its EBEK
Windows in 35 districts and 252 upazilas Bank Asia regularly focuses on green
for 16,29,286 beneficiaries. Bank Asia also financing like renewal energy generation,
gave special attention in school banking carbon emission project, solar home Md. Arfan Ali
so that school going children can build system, CNG conversion project, bio-gas, President and Managing Director
strong savings habit, through this initiative treatment of liquid waste, urban building
the bank collected BDT 16.89 million from safety project, effluent treatment plant
7,354 accounts. (ETP) in brick fields etc. No tobacco related
project is financed by the bank. With
Bank Asia in 2017 extended agri-credit regard to green banking our bank saved
facility to total 92,139 famers that roughly 150,000 page papers through
helped create enormous employment rapid use of automated reporting systems,
opportunities, thereby emit carbon. We are e-mail, e-statements, SMS Banking, e-fund
the first in Bangladesh to introduce smart transfer, online account opening which
agriculture card (A-card) to serve marginal saved Tk. 5.99 million in 2017. Bank Asia
farmers in getting agri-loan and making has also adopted measures to reduce
payments for agri-related equipment. Total energy usage in its daily operational
BDT 22 million was disbursed among 1,367 activities such as installed solar panel in
farmers through A-card in 2017. Moreover, its 11 branches, utilization of maximum
Bank Asia has a scheme to finance the ten natural day light, energy savings bulbs,
taka account holders (2,140 nos.) and a green computing based data center etc.
total of BDT 48.29 million was disbursed
by the bank which was appreciated by The transparency and fairness in
Bangladesh Bank. dissemination of information to the
stakeholders has always been a major
Through our CSR initiatives, we have character for Bank Asia. Here we are glad
reached out and impacted many lives. In

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151
 Report
Parameter
REPORT PARAMETER Bangladesh and others in UK and USA,
Bank Asia is the pioneer in the banking but no joint venture. As owner, the Bank Triple
industry to publish Sustainability Report
and awarded as the first Bangladeshi Bank
controls the activities of its subsidiaries.
Bank Asia Securities Limited (BASL), a
Bottom Line
with GRI certification for its Sustainability majority owned subsidiary is incorporated PEOPLE
Reporting. Our prior two reports were in Bangladesh and acts as a stock broker Bank Asia always plays a very dynamic
based on GRI reporting framework G3/ and stock dealer in capital market. The role in contributing to the society
G3.1 guidelines. But from the year 2014, financial statements through its CSR program, which are
we have prepared our sustainability report of the BASL are prepared on a going thoroughly illustrated in CSR section.
based on GRI reporting framework G4 concern basis under historical cost In the context of value creation model
guidelines and it is the fourth time we are convention in accordance with Bangladesh for its employees, the bank has made
reporting on GRI reporting framework Financial Reporting Standards (BFRS).BA footprints by achieving: Operating
G4 guidelines with an effort to measure, Exchange Company (UK) Ltd. in UK and BA
profit and Net profit per employee
disclose and be accountable to internal Express USA Inc. at NY, USA are two wholly
and external stakeholders in terms of
was Tk.3.2 million and Tk. 0.98 million
owned subsidiaries with
governance, economic, environmental and
respectively during 2017. 61,095 man-
a primary responsibility of remittance
social aspects including both positive and hours training have been provided to
channeling to Bangladesh from UK and
negative contribution. 2,611 employees in the year 2017 both
USA market. Financial statements of BA
in home and abroad.
Exchange Company (UK) Ltd. and BA
Reporting Scope Bank Asia works with a wide range of
Express USA Inc. are prepared on a going
This report intends to touch upon all suppliers, vendors, agents and others.
concern basis under the historical cost
significant environmental, economic and To create value the Bank works with
convention and in accordance with the
social impacts resulting from Bank Asia’s them through collaboration by applying
Financial Reporting Standards for smaller
activities in the financial year 2017. This is its own policy and practice for selecting
entities.
our fifth sustainability report and there is these suppliers and others.
no significant changes regarding scope, Feedback
boundary or measurement methods We welcome any feedback on our
PLANET
and explanation of the effect of any sustainability reporting. For further
As one of the strategic focuses of
restatement of information comparing information and comments, please Bank Asia, ‘going green’ movement
to the previous report. The sustainability contact Sustainability Reporting Team of includes efficient energy consumption,
report will be prepared once in a year the Bank led by Mr. Mohammad Ibrahim paperless office, financing renewable
describing activities and achievements Khalil, FCA, Chief Financial Officer, energy etc. Bank Asia’s achievements
through-out the year. Mr. Md. Shamim Hasnat, First Assistant in green initiatives are detailed out in
Vice President, Group Finance and Ms. other parts of the report. As greening
Boundary of the Report Nahid Tania Khan, Executive Officer, Group of mind, 33,832 manhours of training
The report boundary of the year 2017 Finance. They may be reached through provided to 181 staffs regarding green
covers only banks operation run by banking under foundation trainings
corporate office, its branches, SME service E-mail: course in 2017.
centers and other direct networks in sustainability.ba@bankasia-bd.com
Bangladesh. Impacts of the activities PROFIT
of our subsidiaries, NGO networks or During 2017 Bank Asia generated
our suppliers in other countries are not Operating Profit of Tk. 6,688 million.
within the scope of this report. Bank Asia
has three subsidiary companies, one in

Bank Asia Limited

152
Strategic Focus
for Sustainability

Bank Asia firmly promotes green banking to reach One of the strategic priorities of Bank Asia is to
its long term strategic objective to be a green, triple promote financial inclusion for combating poverty
bottom line bank where every decision will be which the Bank firmly believes to achieve by its
taken with both financial and environmental deposit services, agricultural credit program, small
considerations in mind. The Bank’s green banking enterprise financing for productive new off farm
initiatives includes Online & paperless banking, employment of ‘missing middle’, Solar home system
reducing green house gas emission, mapping projects with NGO-MFI partners, foreign remittance of
bank’s carbon foot print, efficient energy use, poor migrant workers channeling through partner
environment friendly projects, plant nursery and MFIs, ‘Ektee Bari Ektee Khamar’ Project, Agent Banking
horticulture projects etc. channels, domestic remittance distribution through
bank branches and agent banking outlets.

GOING PROMOTING
GREEN IN FINANCIAL
THE FUTURE INCLUSION
OF BANKING

GIVING CUSTOMER
BACK SATISFACTION

Bank Asia believes in giving back to the Bank Asia is sincere to create higher customer
community and it will continue to promote satisfaction and loyalty by its brand enhancement
education, fulfill its commitment to programs & creating brand ambassadors,
community health, disaster management, personalized banking, online product innovation,
clean environment, measure and reduce customer efforts for greater
sports, art and culture. value proposition.

Annual Integrated Report 2017

153
 Corporate
Profile
Bank Asia Limited was incorporated Number of countries where Dhaka, 7 in Sylhet zone one of the leading
on September 28, 1999 as a private the organization operates remittance flow area, 4 in Khulna zone the
commercial bank with the aim of Bank Asia runs its operation only 2nd international port city and adjacent
contributing for the development of the in Bangladesh. However, the Bank to world’s largest mangrove forest, 4 in
economy by bringing superior quality, has two fully owned subsidiaries in Rajshahi the silk city and world’s finest
technology driven banking products and overseas. Among these subsidiaries, ‘BA mango production area, 2 in Rangpur
services. Exchange Company (UK) Limited’ and famous for one of the oldest (1916) and
‘BA Express USA Inc.’ facilitate as speedy best reputed college, Charmichael College,
In 2001, Bank Asia set a milestone by and dependable medium for remitting 2 in Barisal, the main rice producing center
acquiring the Bangladesh operations of the hard-earned money of expatriates of Bangladesh and 1 in Mymensingh,
the Bank of Nova Scotia of Canada, first backhome. ‘BA Exchange Company (UK) renowned for one of the largest Agricultural
in the banking history of Bangladesh. At Limited’ started its operation in London University and largest residence of Garo
the beginning of the year 2002, the bank on May 16, 2011. The 3rd subsidiary of ethnic communities of the country. All
again acquired the Bangladesh operations Bank Asia ‘BA Express USA Inc.’ started its these branches and SME centers are
of Muslim Commercial Bank Limited operation on June 1, 2014 in New York. efficiently supervised and monitored by
of Pakistan. Bank Asia has associated It has also opened its 2 new overseas Zonal heads who take care of their overall
Islamic banking, Off-shore banking, Agent branches in Jamaica and Brooklyn for performance indicators on a regular basis.
Banking, EBEK program and many more remittance channeling to Bangladesh. Every year on an average 7 new branches
specialized services with its core banking are added to our branch network.
activities. BRANCH NETWORK
Currently we have 120 branches and SME SCALE OF THE REPORTING
To excel in this new era of technological service centers across the country spread ORGANIZATION
triumph, Bank Asia has successfully over different zones that includes 116
introduced internet banking, cutting edge As of the end of 2017, our Bank’s operating
branches, 4 SME agricultural branch and 4 profit is Tk. 6,688 million and total assets are
ICT, state of the art network solution, 24/7 SME service centers. Geographically 63 are
ATM service and many other e-products. Tk. 288,996 million. The Bank’s Capital to Risk
placed in capital Dhaka, 37 in Chittagong Weighted Assets Ratio (CRAR) is 14.89 %.
Bank Asia maintains an environment the 2nd largest commercial hub after
of strong corporate governance that
helps to maintain its excellent brand
image; reflected by consistent financial
performance for its stakeholders. To attain Number of employees 2,121 (2,087 of Bank and 34 of Subsidiaries)
sustainability, we focus more on strategic
Number of branches 120 (112 branches, 4 SME/Agri branches and 4 SME service centers)
priorities measured by quantitative
and qualitative determinants. Besides Total operating income Tk.11,967 million
maintaining a steady growth, Bank Asia Total debt & equity Tk. 267,942 million & Tk. 21,054 million
always prioritized in the structural and Number of ATMs 132 own ATMs and more than 7,500+ shared
moral development of the society. From Number of credit cards 39,084
the very beginning the bank has started Number of VISA debit cards More than 3, 36,061
its Corporate Social Responsibility (CSR)
activities for the development of our
country’s unprivileged segments in the
areas of education, health, environment,
sports, arts & cultures and the likes. MEMBERSHIP WITH ASSOCIATIONS
Bangladesh Institute of Bank Management(BIBM)
Nature of Ownership Bangladesh Associations of Banks (BAB)
and Legal Form Association of Bankers Bangladesh (ABB)
Bank Asia Limited was formed as a public The Institute of Bankers Bangladesh (IBB)
limited company under the Companies The American Chamber of Commerce in Bangladesh (AMCHAM)
Act 1994, and governed by the Banking Bangladesh Foreign Exchange Dealers Association (BAFEDA)
companies Act 1991. The Bank obtained Bangladesh Association of Publicly Listed Companies (BAPLC)
certificate of incorporation on September
Money Market Dealers Association
28, 1999 and banking license on October
Metropolitan Chamber of Commerce and Industry
06, 1999. It went for public offering on
Islamic Banks Consultative Forum (IBCF)
September 23, 2003.
Central Shariah Board for Islamic Banks of Bangladesh (CSBIB)

Bank Asia Limited

154
 7
2 2
63

1
4
37 4

Annual Integrated Report 2017

155
Primary Brands
Products & Services
Brand has become an indispensable
part of marketing efforts in current
world. The most successful product
in the world has some special
kind of brand identity. In line with
this, Bank Asia has a number of
communication projects such as mevi Rb¨ meLv‡b
Corporate Communications, Product
Communications, Event Management,
ΝƏŨťũľť ųŝΝŨ
Production, OOH Branding, etc. under
its Corporate Affairs and Branding
Department (CAB).
Branding of Airport, Rebranding
of Islamic Banking Services, Retail
Deposit and Cards products,
Launching of ID products and
Agent Banking, etc. are some of the
significant activities. CAB has done an
excellent job to establish consistent
and uniform communication of the mÂqx I PjwZ wnmve ‰e‡`wkK †iwgU¨vÝ-Gi A_© cÖ ` vb

Bank. On top of that, cost perception gvwmK I ‡gqv`x mÂqx wnmve

PjwZ wnmve (Av¯’ v )
cvm‡cvU© wd MÖ n Y
BDwUwjwU (cjø x we`y ¨ r mn) wej MÖ n Y
has been redefined. Principle of GmGbwW wnmve
Bmjvgx e¨vswKs
GmGgB FY cÖ ` vb
K… w l FY cÖ ` vb
budget optimization has been ¯‹z j e¨vswKs
bM` Rgv I D‡Ëvjb
e¨w³ (cv‡m© v bvj) FY cÖ ` vb
‡WweU KvW© cÖ ‡ mwms
implemented in every single activity dvÐ Uª v Ýdvi mvgvwRK wbivcËv fvZv cÖ ` vb
B.Gd.wU.Gb. (†h †Kvb e¨vs‡Ki wnmv‡e) cÖ w Zôv‡bi †eZb cª ` vb cÖ w µqvq mnvqZv
starting from production, event
management, item purchase, etc. CAB
under the Public Relations Department
contributed to media innovations. It
produced and distributed branded
gift items for clients on the occasion ŝŨŗŨũŅľ ŝūřǐŨŖŨōŨ ŔΡŏŨő ĺĮľŨŴŊΠ ľŲũŜŔŌƏ έţ

of ‘Bangla Nabobarsha’ and ‘Mahe-

Ramadan’ that created an impulse
in brightening image. Ramadan
Schedule, Engraved wooden box,
Branded wooden pen, pocket diary
etc. created huge appeal among ŗűŤ ũśẦ ǕŨẵŨř ľŲũŜ ĹŌ фŏŨő ōŧŨō ǕŨẵŨř

general people.

Bank Asia Limited

156
OCAS-Diganta
We initiated reaching the rural and
semi-urban mass of the population with
the objective to do inclusive banking
through establishment of Agent Banking
all over the country. Though the initial
value of the network pinned down to
financial inclusion through an account
for all, but we strongly realize the gap of
required financing of the entrepreneurs of
those localities. As we started to process
the paper base proposals, we came across
the need of digitization to minimize the
duration gap of an entrepreneur finance
proposal from initiation to reaching the
corporate office. This need driven us to
prepare a digital platform under the name
of “DIGANTA” whereby customers KYC,
Assessment, become digital and reaches
Corporate office with one click through
telecommunication network.
Implementation:
Bank Asia uses its own MSE finance
programme to provide Micro & Small
loans to optimistic entrepreneurs in the
under-developed regions of Bangladesh.
Typically, Cottage, Micro & Small
Enterprises (CMSEs) in various parts of the
country do not have collateral or may not
have a credit history to secure a traditional
loan. The local Bank Asia Agent points are
channeling these loan propositions under
the banner of Diganta. By providing greater
automation of the loan approval process,
the bank is able to drastically reduce
the time taken to assess and approve
financing proposals. This platform was
developed with the help of challange fund
from BFP-B under UK Aid.
Benefits:
OCAS-Diganta is a software based
financing system to facilitates the CMSEs,
1,908
Agro Entrepreneurs, Retail financing
through TAB & PC based digital platform.
It reduces the time, papers and cost of the 1,395
customers as well as bank and provides
the banking service to the customer’s
access to finance in a better and faster
manner. 727.31
Impact: 575.31
Till December 2017, about 1,900 customers 367 Diganta OCAS 2017
got the benefit of access to finance at an 131.56 146 No of A/c
affordable rate, with Tk. 72 crore worth of 20.44 Amount (Tk Mln.)
loans channeled through OCAS-Diganta.
MSE Finance Consumer Agricultural Total
Finance Finance

Annual Integrated Report 2017

157
 Products &
Services
RETAIL Triple Benefit Plus Green Energy Loan
BANKING Bank Asia Sanchay Plus Talent Learning and Earning
PRODUCTS Deposit Pension Scheme Plus Bicycle loan
Deposits Shonchoy E KotiPoti Motorcycle loan
Low Cost/No Cost Deposit Accounts
Current Deposit Account Consumer Finance Credit Card
Savings Bank Account Auto Loan VISA Platinum Card (with Priority Pass)
Star Savings Account Shapner Bahan VISA Classic Local Card
Short Notice Deposit Account House Finance VISA Classic Dual Card
Foreign Currency Account Shapner Abash VISA Ladies Card
Account for Under-privileged Section Griha Shaj VISA Butterfly Card
(10 Taka, Street Urchin, Beneficiaries Shapner Kuthir VISA Gold Local Card
VISA Gold Dual Card
Hajj Card
Virtual Card
Master Silver Card
Master Gold Card
SME Credit Card
LankaBangla Card Cheque
Gift Card
Islamic Credit Card
Salamah Platinum Card
Salamah Gold Card
Salamah Silver Card

ISLAMIC BANKING PRODUCTS

Deposit Products
Al Wadiah Current Account (AWCA)
Mudarba Savings Account (MSA)
Mudarba Corporate Privilege
Savings Account (MCPSA)
Smart Junior Saver
(School Banking) Account
Mudarba Special Notice Deposit
Account (MSNDA)
Mudarba Term Deposit Account
(MTDA) for different tenure
Corporate Term Deposit Account
(CTDA) for different tenure
Mudarba Monthly Profit Paying Deposit
Scheme (MMPPDS)
Mudarba Deposit Pension
Scheme (MDPS)
Mudarba Hajj Savings Scheme (MHSS)
Cash Waqf
of National Service program, Shapner Nirman
Investment Products
Cleaners, Garment Workers, Nijer Bari
Bai Murabaha Muajjal (both Local and
Technicians of Small Industries, etc.) Consumer Durable Loan
Post Import)
Term Deposit (s) Unsecured Personal Loan
Hire Purchase Shirkatul Melk (HPSM)
Fixed Deposit Regular Proyojon
Musharaka
Chuti
Murabaha Import Bills
Scheme Deposit (s) Sheba
Quard against Accepted Bills
Monthly Benefit Plus Loan for Professionals
Quard against MTDR
Double Benefit Plus Shabolombi
Quard against Schemes
Loan for Senior Citizens
Purnata
Bank Asia Limited
158
 Entrepreneur
MICRO, SMALL, MEDIUM AND
AGRICULTURE BANKING PRODUCTS Probaho-Term loan for Electric Cluster CORPORATE BANKING
at Dhaka Cash Management Products
Deposits
Shombhabona-Term loan for New Bank Asia provides corporate customers
All conventional deposit products except
Entrepreneur a full range of cash management
savings bank deposit, scheme deposits and
Bondhon-Term & seasonal loan for products and services. A wide range of
other deposits for only individual custom-
Handloom & Specialized cloth Cluster at solutions are offered to help them plan,
ers.
Bogra monitor and manage their liquidity and
Micro & Small Enterprise Finance meet payments, receivables, accounts
Bahon-Commercial Vehicle Finance
Asset Product and information requirements. Specific
Nilima-Collateral free Term Loan for
Shomadhan - Over draft for Trading, products and services are as follows:
Women Entrepreneur (except Dhaka
Manufacturing, Service & Women
& Chittagong)
Day-to-day cash control
Account Packages – Current, SND and
Liability Product
Fixed Deposits
Astha-SME Current Account
Monitoring money at the bank, both
active and non-active cash
Medium Enterprise Finance
Receipts and items in the course of
Funded Products
collection
Secured Over Draft (SOD)
Payments and items in the course of
Cash Credit Hypo
being paid
Over Draft A/C
Cash Pick Up & Delivery
SOD (Earnest Money)
Short-term investments
Loan against Imported Merchandize
Short-term borrowings
Loan against Trust Receipt
Short-term foreign exchange
Payment against Document (PAD)
positions
Documentary Bills Purchased - LCY
Electronic payments
Demand Loan (Workorder)
Booths
Forced Demand Loan against L/C
Funded Products
Term Loan Industrial
Secured Over Draft (SOD)
Term Loan Others
Cash Credit Hypo
Loan General
Over Draft
Transport Loan
SOD (Earnest Money)
House Building Loan - General
Exporter’s Cash Credit
Lease Finance
Documentary Bills Purchased - FCY
Time Loan
Documentary Bills Purchased - LCY
Demand Loan (Work order)
‘Non Funded Products
Loan against Imported Merchandize
Letter of Guarantee
Loan against Cash Incentive
Letter of Credit
Payment against Document (PAD)
(Sight/Deferred/UPAS/EDF)
Loan against Documentary Foreign Bill
Back to back Letter of Credit
FCY
(Local & Foreign)
Forced Demand Loan against L/C
Term Loan Industrial
Agriculture Finance
Term Loan Others
SOD (10 Taka Savings)
Loan General
Demand Loan against 10 Taka Savings
Transport Loan
Short Term against 10 Taka Savings
Loan against Packing Credit
Cropping Demand Loan
Loan against Trust Receipt
Dairy and Fattening Demand Loan
Entrepreneurs House Building Loan - General
Dairy and Fattening Term Loan
Utshob-Collateral free Seasonal loan Lease Finance
Fishery Demand Loan
Shubidha –Collateral free Term loan for Trading PAD (Export Development Fund)
Fishery Term Loan
Sristi –Collateral free Term loan for Export Development Fund (EDF)
Equipment Term Loan
Manufacturing Loan (FCY)
Poultry Demand Loan
Shofol - Collateral free Term loan for Service Time Loan
Poultry Term Loan
Shondhi –Term loan for Trading Demand Loan (Work order)
Demand Loan against NGO
Shombridhi – Term loan for Manufacturing
Agriculture Term Loan against NGO
Sheba –Term loan for Service
Subarno -Term loan for Women
Annual Integrated Report 2017
159
 Non Funded Products Services securities
Letter of Guarantee Account Opening Repo
Letter of Credit Deposit & Withdrawl ALS(Assured Liquidity Support)
(Sight/Deferred/UPAS/EDF) Fund Transfer within bank and to any Reverse Repo
Back to back Letter of Credit bank in Bangladesh Currency Swap
(Local & Foreign) Inward Foreign Remittance payment
Utility Bill Payment Foreign Exchange
Structured Financing Balance Inquiry Spot Foreign Exchange
LCY syndication arrangement Account Statement (mini) Forward Foreign Exchange
FCY term Loan and syndication Insurance Premium Collection Forex Swaps
Multilateral financing Passport Fee Collection Cross Currency Swaps
Advisory services SME Loan Processing Interest Rate Swaps
Trustee and agency services Agricultural Loan Processing Interest Rate Cap and Collar
Arranging Debt (Bonds/Commercial Retail loan processing
Paper) Repayment of loan Installment CAPITAL MARKET SERVICES
Customized financial solutions Disbursement and Payment of Social Brokerage Services
Special arrangements (IPFF/ Special Safety Net Attractive Commission Rate
fund of BB/ Agribusiness Loan etc) Salary Disbursement Solution Wide Branch Network
A-Card for farmers Margin Loan
OFF-SHORE BANKING UNIT Debit/NFC Card Services CDBL Services
(OBU) PRODUCTS Mobile Top Up Research
On-shore Import & Export Agent Banking Apps Daily Market Update and
Bill Discounting News Summary
UPAS Loan TREASURY PRODUCTS Institutional and Foreign Trade
Bill Purchase Money Market, Fixed Income, Panel Broking
Working Capital Finance & Capital Market Portfolio and Risk Management
LTR Internet and Smartphone trading
Packing Credit Call Money
Term Loan Notice money
Lease Finance LCY/FCY Term
Trade Finance Fixed Income & Capital market
Import, Export
Loans & Advances to wholly foreign
owned entities
LTR
Term Loan
Demand Loan
Term loan to local entities
ECA loan to local entities
Nostro account services to other
local banks

AGENTBANKING

Products
Current Deposit Account
Savings Bank Account
Short Notice Deposit Account
School Banking Solution
Smart Junior Saver Account
School Banking Account
School Fee Collection
Payroll Banking for Teachers
Term Deposits
Remote Banking (EBEK)
10 Tk. Accounts

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160
 Advertisements
on Integrity

The Daily Star- Dec 16, 2017 The Daily Somokal- Jun 20, 2017

The Daily Prothom Alo- Apr 23, 2017 The Financial Express- Aug 29, 2017

Annual Integrated Report 2017

161
 Stakeholders’
Engagement

Bank Asia believes in the proper stakeholders’ Proximity: The local community that Impact analysis from the aspects of
engagement in every aspect of its banking influence heavily our daily operation. governance, economic, environment and
activities. We identify our stakeholders through social influences help the bank recognize and
conducting impact analyses in respect of Dependency: Those who are dependent respond to emerging risks and opportunities
on their operational performance, and meet the expectations of those who
Responsibility: Bank Asia has direct legal e.g. business partners, and those whom shape the operating environment. Continuous
responsibility to regulators, tax authority etc. we are dependent, e.g. customers. engagement with stakeholders is integral to the
success of our business.
Influence: Decision making of the bank Representation: Those who represent
is influenced to reach its intended goals Bank Asia to the outside world, e.g Bank Asia prioritizes stakeholders’ issues based
by shareholders and employees etc. employees, board and those whom on materiality mapping determining the level
we face for various decision making of relevance and significance on economic,
purposes. e.g. business association leaders, environmental, social and financial impacts.
local community leaders .

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162
Stakeholders’
Engagement

Stakeholders Ways of inclusion Their priorities Our response

Customers Customer Good return from deposits ALCO sits every month to decide
Relationship Fast service delivery with pricing and rates based on market
Management excellence analyses
Complaints Preferential pricing, All network nodes are run by online
and customer charges and commission core banking system (CBS)
satisfaction Strict Shariah compliance E-products like mobile apps, SMS
survey in Islamic products and banking, EGP service, E- commerce,
Customer services E- payment solution, internet banking
feedback Product varieties catering Separate online CBS for Islamic products
Management market demand Front desks and relationship managers
Ongoing market Online banking solutions ensure fast and high quality service
research with secured transactions, delivery following one to one
and product privacy and confidentiality relationship
innovation Ensuring better and Proper actions are taken of customers
Customer Service uniform services to the complaints if any service goes against
Enhancement customers the customer service policy of the Bank
Program First working day in every month
is being observed as ‘Customer
Service Day
Employees Business Talents and performances 61,095 man hours training for 2,611
conferences, development human capital in 2017
teleconferences, Regular training Salary package adjusted in line with
video conference etc. Inflation adjustment in pay market competitiveness and inflation
Training, workshops package planning Yearly performance bonus for
and orientation Job description setting as employee motivation
program, internal per individual skill Well set KPIs for performance and
meeting, group Performance driven career inherent quality analysis
emails, progression All sorts of safety measures such as
intranet circulation, Healthy working fire extinguishers, separate stairs are
physical fitness, environment and Policy available and smoke free premise
Future Leadership formulation for safe 260 Claims of insurance received of
Development working atmosphere Tk. 8.99 million in 2017
Program (FLDP), safe Ensure hygienic and Pick and drop facilities has been
and clean working congenial workplace by provided through 14 vehicles both in
environment observing Cleanliness Day Dhaka and Chittagong region
Group Health Insurance Formulation of ‘Female anti
Gymnasium at Corporate harassment policy’ and ‘Grievance
office and BAITD handling policy’ to resolve complaints
Transport facilities for in a fair manner
female employees Employees under different mentors
Future Leadership are being trained as per FLDP program
Development Program & First Saturday of every alternate
Sports Tournament months is being observed as ‘Cleaning
Day’ where employees are actively
participate to clean the office premises

Subsidiaries Policies Goals and Strategic Review local market and environment
formulation focuses are based on local before setting its strategic priorities
Agreed upon environment analyses & ensuring proper representation from
strategic goals regulatory purview subsidiaries

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163
 Stakeholders’
Engagement
Stakeholders Ways of inclusion Their priorities Our response
Local Promoting financial Provide banking facility Strongly consider environmental and
Communities inclusion both to geographically social impact and restrain from adverse
for banked and dispersed poor impact upon society
unbanked people, segment of the society Target segment is under developed and
CSR contribution- through Agent Banking under privileged people
Scholarship to poor network Services to old citizen, widow and
meritorious students Benefit economy by disable beneficiaries
poverty reduction Significant contribution to education,
through banking health, disaster management, art &
services to rural poor culture, environmental and sports sector
people by EBEK Project
Support under
privileged people
through Social Safety
Net programs
Business Procurement Fair trade, fair Free from any bias or coercion from
Partners management, enlistment, influencing quarters
training and Sustainable and stable Fair play & competition to award work
communication growth of the bank order
Timely payment to vendors
Shareholders/ AGM, EGM, annual & Healthy return on Maintained attractive plough back ratio
investors semiannual report, investments and stable Timely payment of debt with stated return
publishing quarterly dividend policy Established risk management culture
financials, credit Growing earnings Transparency & integrity in financial reporting
rating and PSI in Sound governance Maintained consistent ratings through
newspapers and risk management, financial commitments
ratings of the bank Each queries of the investors meet up
based on overall through our share department efficiently
financial performances and fairly
Board & Decisions based Governance principles, At least one board meeting in every
Management on financial policies & procedures month, frequent executive committee
and business formulation meeting, audit committee meeting
delegation of Strategic focus & value Board members meet management on
different levels creation various occasions like annual &
Major decisions Strategic business semi- annual business conferences,
must be placed planning bank’s anniversary celebration
to board for
approval
Government Strict ethics & Proper compliance We ensure proper compliance and timely
& regulatory compliance with laws & regulations reporting to government bodies and
Authority with applicable Timely reporting as per regulators
laws, rules and requirement Contributed Tk. 4,408.07 million to
regulations Timely payment of National Exchequer which significantly
income tax and VAT contributed to Government’s revenue
accurately collection

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164
Material Aspects
and Boundaries
Material Aspect Boundaries inside the organization Boundaries outside the organization
Client base of the organization increases The community including the overall economy
with diversity, taping business opportunities, benefitted from reduction of poverty through
Financial Inclusion
increase of revenue generation augmenting economic activities in the
geographically dispersed areas
Efficient use of scarce resources Sequestration of carbon emission and the national
Energy Consumption
GHG inventory will be reduced
Enhancement of operational level efficiency. The clients will be benefitted from customer friendly
Human Capital Attaining cost savings through reducing time efficient services and will be more loyal to bank
& Talent management requirement. Customer retention rate will be
higher
Product diversification and attachment to As an agricultural country, share croppers and
Agricultural Credit mainstream of the economic activity of the marginal farmers will be benefitted by lower interest
country rate and their poverty level will be improved
As a responsible corporate entity, the Public awareness as well as regulatory requirement
Bank believes in doing business without enforced the organization to increase environment
Environment friendly
compromising with the eco system. It friendly investment gradually
Investment
emphasizes conserving scarce resources for
next generation
Discharging our responsibility towards society Overall betterment of the nation through CSR
Building the Community to ensure sustainable balanced growth in activities in different sectors like health, education,
economic, social and ecological arena sports and culture etc.

Paintings by children of the employees of Bank Asia for

observing Independence Day 2017

Annual Integrated Report 2017

165
 Environmental
Performance
ENERGY Million Taka
Energy Savings Cost of Conventional Cost of Green
Since the inception of our corporate Office Sl Instruments Quantity
Practice Banking Concept
from 2011, Bank Asia ensuring the maximum
usage of natural day light to reduce the 1 E Statement 92,981 0.93 NIL
energy consumption substantially in contrast 2 SMS Banking 98,914 0.99 0.025
with other mainstream constructions.
3 SMS Alert 215,862 2.16 0.054
Moreover, energy savings bulbs consist of
a third of the total lighting system here. 4 Net Banking 59,826 0.60 NIL
As a result, more than 40% electricity i.e. 5 E-Fund Transfer 49,918 0.50 NIL
Tk. 6,454,045 is saved using the day light
in side corporate office. E-mail has been
6 Digital Attendance 996 0.000536 NIL
the focus of both internal and external 7 E-Mail Corresponding 88,942 0.89 NIL
communications with an aim to reduce Total amount 6.07 0.079
the paper consumption since 2005 thereby
reduce deforestation.   Net Savings Taka 5.99 million  

Energy Consumption
Million Taka
SOLAR HOME SYSTEM WASTE MANAGEMENT
2017 2016 Bank Asia is committed to enlighten every This process is involved in dealing with the
Energy Type rural home with green electricity. At present, waste generated from day to day banking
only about 40% of the rural households in activities, food consumption, physical wear
Electricity 93.97 88.22 Bangladesh have access to grid electricity. & tear of computer and office equipment,
Fuel and CNG 10.40 12.17 For the rest of the areas are not connected obsolete furniture & fixture and newspapers.
to the national grid, life comes to almost a Being a financial institution Bank Asia does
Solar powered branches standstill there after sun-set. Giving priority in not deal with any hazardous waste.
We have already installed solar panels in our this sector, Bank Asia has been supporting to
11 branches located at Patherhat, Madhobdi, import and install solar home systems in the Both sides of papers are used and wasted
Dohajari, Hajigonj, Faridpur, Elephant Road, off grid area. papers are collected using bins after
Lalmatia, Sonaimuri, Bashabo SME service Bank Asia financed of Euro 5.17 million under shredding
Centre, Bank Asia Bhaban & Nimtola Branch. the Export Credit Agency (ECA) to Engreen Donate old equipment and furniture for
Financing renewable energy and Sharishabari Solar Plant Ltd. for establishing charity or sold
carbon offset projects a 3-MWp (megawatt-peak) Grid-Tied SPV
During the year 2017 we have disbursed (solar photovoltaic) independent power Food wastes are collected by community
Tk. 3.594.52 million to 91,139 farmers plant on 8.23 acres of land at Sharishabari cleaners on daily basis
where through A- card, the Smart form of of Jamalpur. This is first of its kind power
Toner, cartridges and newspapers
Agricultural credit was propagate into 1,367 project ever established in Bangladesh which
disposed off through community
rural farmers of Tk. 22 million which helps has already gone to COD in 2017.
cleaners.
sequestration of carbon. WATER USAGES
Liquid Waste Management
Reducing Energy & Resource Consumption Bank Asia is very much conscious about
Bank Asia is very concern about the present
Instruments of Green Banking offered by efficient use of water. As a financial
situation of our environment because
Cards Division include E-Statement, SMS institution its use of water is already very
of wastes so the future of the people is
Banking, SMS Alert, Net Banking, E Fund much restricted. Major consumption of water
threatened with boundless destruction. The
Transfer, and Digital Attendance and E Mail is for drinking purpose. Our bank is also none
situation is worst in both cities and villages.
corresponding, which help reducing printing compromising about ensuring pure and safe
Environmental problems like unplanned
paper. In 2017, our Cards Department drinking water for its employees and visitors.
urbanization, industrialization, disposal
through its digital filling system have been But normal supply water in Bangladesh is not
of hazardous wastes, rivers, lakes and
archived more than 88,932 pages. Moreover safe for drinking. Therefore, to overcome the
roads, soil pollution, water shortage, water
New Issuing, Replacement, Activation and situation every branches and corporate office
contamination and water logging are only a
PIN request are automated which reduced are supplied with specially procured filtered
few to mention. In this situation, during 2017,
Debit Card issuance time to 2-3 days from mineral water. The management of the bank
Bank Asia disbursed Tk. 37.54 million for
7-9 days as well as paper saved 1,50,000 takes special care so that wastage of water
the treatment plant of liquid waste to Winter
pages and 20,000 courier service deliver cost. as minimum as need. Total consumption
Dress Ltd.
Unlike every year, the Bank has developed is controlled by monitoring per employee
GREENHOUSE GAS EMISSION
e-Cards for its stakeholders this year. drinking water cost per month.
Saving CO2 emission
Since 2014, Bank Asia implemented Video
Conferencing System to connect with remote
branches for strengthening relationship

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166
Environmental
Performance
between Head Office and branches. By using BANK ASIA AND GREEN BANKING enhances the positive impact over the
the system, Management can save time and Bank Asia always believes in growing in society. In 2017, Bank Asia further financed
money as well as CO2e by avoiding long a responsible manner maintaining eco- to Valmont Fashion Ltd. of Tk. 0.73 million for
distance travel in order to attend meetings. friendly environment by playing a major importing Fire Alarm, Fire Detection system
Currently, the system has been implemented role to mitigate Environmental risks which and Fire hydrant System for compliance
in few branches. is essential for our survival. Since its of the project and procuring materials/
inception, Bank Asia has been committed equipments/ accessories from local sources
REDUCING CARBON FOOTPRINT towards Sustainable Development that and installation of Fire system.
Since inception Bank Asia has turned to eco- makes environmentally, economically and
As part of sustainable finance initiative,
friendly banking as a way to lower carbon socially responsible. As a Bank, we play
Bank Asia ICT Division has introduced
footprint in its’ normal banking activities. an intermediary role between economic
new green data center operated on green
Bangladesh Bank introduced a refinance development and conservation of the
computing principles having same features
scheme ( Revolving Fund) of Tk. 200 crore environment. Our Green Banking activities
and capabilities of a typical data center
to offer refinance facility against the Bank/ are on multidimensional areas which include
but uses less energy and space, and its
Financial Institution’s finance to promote both in-house Green activities towards
design and operation are environmentally
smooth financing in Green products/ supporting Green Economy.
friendly. The Bank’s ICT Division has already
initiatives in Bangladesh. As part of our
The Bank’s working environment deployed Blade servers to reduce space
commitment for our green economy we
encourages usage of e-mails, relying on occupancy as well as power consumption. To
have signed a participation agreement with
online instructions for communication, enhance cooling efficiency we have installed
Bangladesh Bank under refinance scheme
using natural daylight and extensive usage cold aisle containment system which has
in 2011 for lending in solar energy, bio- gas,
of energy savings bulbs. These steps show reduced significant power consumption
and effluent treatment plant(ETP) & hybrid
the Bank’s efforts towards encountering in 2017.Moreover Bank Asia ICT Division
Hoffman kiln (HHK). In 2017, the Bank
in-house environment management as has been providing automation system in
entered into arrangement with Bangladesh
part of supporting green banking. Our different department for practicing paperless
Bank for two step loan for Urban Building
Green Banking Policy Guidelines and Green reporting and other documentations. We
Safety Project under JICA/Bangladesh Bank
Office Guide have been circulated to all also deployed Smart Clients instead of
Refinancing Scheme.
our employees for creating awareness conventional PCs which were highly secured
In 2017, Bank Asia approved the funded limit on Green Banking activities & providing and easy to deploy but low maintenance cost
Tk. 1,090 million and non funded limit of Tk. instructions about conserving energy, water, and low power consumption.
588 million to Triple Apparels Limited, having saving paper, etc. Bank Asia developed its
As greening of mind, several trainings
USGBC Certified LEED Certificate (energy own Environmental Policies which proves
were organized related to Green Banking &
and water efficient, healthy, comfortable our commitment to the Environment for
Environmental Risk Management, Reporting
and environmentally friendly construction). a sustainable future. We have unified our
format of Green Banking activities, Financial
Moreover, the Bank also financed Tk. 26.80 sustainable operations under the “Green
inclusion, CSR and Green Banking this year.
million in 14 projects to set up Zigzag Banking Unit” equipped with permanent
In 2017, BAITD has provided 5 trainings on
chimney for better energy efficiency and employees. Besides this, Bank Asia has also
Green Banking under Foundation training
lower emissions. introduced a new department in early 2017
course to 181 employees. Moreover, our bank
named Sustainable Finance Department
Besides this, we facilitated 2,140 no. of also organized a seminar in collaboration
the same in alignment with Bangladesh
borrowers by disbursing TK. 48.39 million with IFC on ‘Seminar on Sustainable
Bank with its proficient Sustainable Finance
for 10 Tk. Account holders and received Energy Financing’. Besides this, 3 of our
Committee to monitor Sustainable Banking
refinance of Tk. 45.50 million from officials participating in the workshop on
and Sustainable Finance.
Bangladesh Bank in 2017. ‘Sustainability Reporting Practices in Banks
For a sustainable economy Bank Asia plays of Bangladesh’ organized by BIBM.
a crucial role for financing the project that

Bank Asia financed Triple Apparels Limited, having USGBC Certified LEED Certificate
Annual Integrated Report 2017
167
 Environmental
Performance
In view of highlighting our Green Banking our bank with their utmost satisfaction
activities and creating awareness amongst through e-Government Procurement (e-GP)
our stakeholders, the Articles on Green system. We received more than 3,65,087
Banking, sustainability reporting were number of passport payments of Tk. 144
published in different newspapers which crore (approx) from clients through all our
reflect our Green initiatives to our employees, centers, 132 own ATMs, more than 7,500 branches and ADC channels. Clients are
our stakeholders and all subscribers of those shared ATMs and others. Clients can also now having banking facilities for 66 out of 67
newspapers. have access to their accounts through RPOs over the country. Now the customers
Internet & Mobile Banking via Smartphone’s can transfer fund from their Account to Inter-
Like previous years, the Bank has published which can be used for internet based Bank Accounts and Debit & Credit Cards real
Sustainability Report and achieved ‘Best applications for transactions. Total Mobile time by integrated Internet banking system
Sustainability Report Category Overseas’ for App user of the Bank is 17,799 and more where the Bank recently integrated Internet
Sustainability Report 2016 in Sustainability than 1,13,257 number of transaction of tk. banking system to NPBS on first phase with
Reporting Award 2017 (SRA 17) by NCSR 425 million (approx) have done through this other 5 NPSB Banks. Now the total Internet
(National Centre for Sustainability Reporting) Mobile App. Online banking system is a great Banking user of Bank Asia is 65,000.
Jakarta, Indonesia. way to reduce wastage of paper. In our banking system recently ‘e-Commerce’
has incorporated for its valued customer
where Bank plays as payment partner &
Mr. Ashfaqul account holders can shop online through
Hoque, internet banking, Debit Card or Credit Card
Group with less expense & in faster time from any
Finance, time anywhere. Through SSL, Bank Asia’s
Bank Asia
received SRA
accountholder can purchase products &
award from services from different Merchant websites.
Professor
Mohammad Others
Nasir, the Bank Asia spent Tk. 183.83 million to
Minister of Prime Minister Relief and Welfare Fund,
Research, Higher Studies Scholarship, construction of
Technology BSMMU & proposed ‘Ma Amiran hospital’ in
and Higher
Education in
Sirajdikhan, Malkhanagar, National Heart
the Republic Foundation, different socio cultural and
of Indonesia religious program in 2017.
COMPLIANCE
INITIATIVE TO REDUCE THE BANK’S During 2017, Bank Asia has not faced any
Bank Asia has implemented most advanced
ADVERSE IMPACT ON ENVIRONMENT penalties for non-compliance with applicable
solution in receiving utility bill payment and
Bank Asia by principle always averts laws and regulations concerning the impacts
e-Government Procurement (e-GP) , Passport
financing in environment hazardous of its operations on communities.
fee collection systems through a full real
business. The bank has decided not to time online web based which has enables
finance any tobacco related business, and all for payment in a smooth and hassle free
offices of the bank are declared smoking free manner. Currently 56 branches have been
zone. We incorporated environmental and registered in e-GP system where customers
climate change risk as part of the existing have received around 31,229 services from
credit risk methodology prescribed to assess
borrowers through environmental due
diligence (EDD) checklists.
In this regard, Bank Asia signed an
agreement with Bangladesh Bank to finance
export oriented Textiles & Textiles Products
and Leather Manufacturing Industries
under Green Transformation Fund (GTF) of
Bangladesh Bank.
Online Banking
Technology continues to be a strong pillar
in the Bank’s idea to attract the banking
experience of its customers. Bank Asia has
been one of the pioneers in introducing
Online Banking and in 2017, it covers 112
branches, 4 Agri/SME branches, 4 SME
Bank Asia organized a seminar on sustainable energy financing in collaboration with IFC

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168
Kunderpara Gono
Unnayan Academy
Sponsored by Bank Asia Family
Bank Asia employees mobilized a fund to support reconstruction of a high school named “Kundarpara Gana
Unnayan Academy” at a char in Gaibandha district torched by some miscreants in the last week of January, 2017
that touched every heart. Seeing tears of innocent students, the honorable Chairman and management of Bank
Asia decided to rebuild the school so that academic activities of the poor pupils go on uninterrupted. In this
backdrop, all the employees of Bank Asia donated TK 1.5 million for this noble initiative.

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169
 Economic
Performance

VALUE ADDED STATEMENT VALUE ADDED STATEMENTS

Value added statement shows how much Million Taka
value (wealth) has been created by the Items 2017 2016
bank through utilization of its capacity, Income from banking services 22,809 21,241
capital, manpower and other resources
and how it is allocated among different Less: Cost of services & supplies (13,128) (12,499)
stakeholders i.e. employees, shareholders, Value added by banking service 9,681 8,742
government etc. Non-banking income
In the year 2017, bank’s net value addition Provision for loans & Off-balance sheet exposure & others (2,630) (2,634)
was Tk. 7,051 million; 36% distributed
Total 7,051 6,108
to employees as salaries, 29% to
shareholders as dividend & reserve, 28% to
government as income tax and rest of the Year
amount used for business expansion and Distribution of value addition 2017 2016
growth. Amount % Amount %
To employees as salaries 2,534 36% 2,352 39%
To providers of capital as dividend & 2,045 29% 1,715 28%
reserve
To Government as income tax 1,969 28% 1,678 27%
To expansion & growth
Retained profit 2 .03% (169) -3%
Depreciation 460 7% 469 8%
Deferred Taxation 42 1% 63 1%
504 363
Total 7,051 100% 6,108 100%

Value Added
Statement 2017
36% To employees as salaries
29% To providers of capital as dividend and reserve
28% To Government as income tax Value Added
0.03% Retained profit Statement 2016
7% Depreciation 39% To employees as salaries
1% Deferred Taxation 28% To providers of capital as dividend & reserve
27% To Government as income tax
-3% Retained profit
8% Depreciation
1% Deferred Taxation

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Economic
Performance
ECONOMIC VALUE ADDITION DURING THE YEAR
Market
Economic Value Added (EVA) indicates the true economic profit of the company. EVA is
Value Added
an estimate of the amount by which earnings exceed or fall short of required minimum Million Taka
return for shareholders at comparable risks. Shareholders Equity providers are always Total market value of the equity
conscious about their return on capital invested. As a commercial banking company we Total book value of the equity
are deeply concerned about delivery of value to all of our shareholders/ equity providers. Market Value Added
ECONOMIC VALUE ADDITION
Million Taka

19,387.72
Particulars Year
 

22,799.96
2017 2016 2015

15,774.55
Invested fund by shareholders      

19,387.72
Shareholders equity 21,054.49 19,389.81 18,979.33
Add: Cumulative Provision for loans/ investment/
off-balance sheet items, offshore banking units & 9,589.05 8,586.44 7,264.26
others
Total invested fund by shareholders 30,643.54 27,976.25 26,243.59
Average invested fund by the shareholders [A] 29,310.23 27,109.92 24,710.08
Earnings for the year

3,412
Profit after taxation 2,047.53 1,897.24 2,573.92
Add: Provision for loans/ investment, off-balance
2,630.03 2,281.73 1,881.74
sheet items and Offshore banking units
Less: written off during the year 2,138.55 920.45 1,075.79 2017 2016
Earnings for the year [B] 2,539.01 3,258.52 3,379.87

(3,615)
Average cost of equity (based on Shanchay Patra
rate issued by the Government of Bangladesh) 13% 13% 13%
plus 2% risk premium [C]
4,408

4,349
Cost of average equity [D= A x C] 3,810.33 3,524.29 3,212.31
Economic Value Added [B-D] (1,271.32) (265.77) 167.56

MARKET VALUE ADDED STATEMENT

Market value added statement shows the difference between the market value of the
2,732

bank and the capital contributed by shareholders i.e. book value of equity. During the
2,673

year 2017, total market value of the bank was Tk. 22,799.96 million and total book value of
equity is Tk. 19,387.72 million i.e. addition of market value was Tk. 3,412.24 million.
Million Taka
1,674

1,550

No. of shares Share price

Particulars Taka
(in Million) (in Taka)
Market value 987.01 23.10 22,799.96
Book value 881.26 22.00 19,387.72
Market Value Added 3,412.24
61

68

CONTRIBUTION TO NATIONAL EXCHEQUER

Bank Asia has contributed significantly to the government’s effort of revenue 2017 2016
collection. As a corporate entity, the bank pays tax and VAT on its own income
according to prevailing laws of the country. Besides, the bank deducts income tax, Contribution to
VAT and excise duty at source from customers and suppliers and deposits the same National Ex chequer
Million Taka
to the national exchequer. During the year 2017, the Bank contributed Tk. 4,408.07 Income tax payment on bank’s earnings
million to national exchequer. Income tax, VAT, and Excise duty deducted at
source from various payment and services by
the bank
Income tax payment by the employees
Total Payment
Annual Integrated Report 2017
171
 Economic
Performance
CONTRIBUTION TO NATIONAL EXCHEQUER
Million Taka entrepreneurship, creating business
Particulars 2017 2016 network for CMSE entrepreneurs and
financing in untapped areas to the
Income tax payment on bank’s earnings 1,674.00 1,550.00
unbanked new entrepreneurs.
Income tax, VAT, and Excise duty deducted at source from
2,673.21 2,731.65 The SE & SPL Department of the Bank has
various payment and services by the bank
arranged launching of 3 new products
Income tax payment by the employees 60.86 67.69 titled “Nilima”-for Women Entrepreneur,
Total Payment 4,408.07 4,349.34 “Bahon”-for Commercial Vehicle Finance
and “Astha”- Special Current Deposit
account for SME Entrepreneur.
SUPPORTING THE ENTREPRENEURS Focusing on cluster financing, grooming-
up new entrepreneurship development, Apart from the above, the Bank arranged
THROUGH CMSE different business meeting with the
Cottage, Micro and Small businesses promoting women entrepreneurship,
creating business network for CMSE existing and potential clients throughout
are catalyst in the socio economic the year.
development of many countries of the entrepreneurs and financing in untapped
world. They are viewed as vehicles for the areas to underserved people Banks Asia’s EMPOWERING COMMUNITIES
achievement of national macroeconomic CMSE Department always engaged for THROUGH AGRI/RURAL CREDIT
objective in terms of employment opening the door of prosperity to many During 2017, Bank Asia has disbursed Tk.
generation at low investment cost and entrepreneurs of the country. Bank Asia 3,594.52 million (Tk. 873.49 through own
enhancement of apprenticeship training. also adopted a cluster-based approach network and Tk. 2,721.03 million through
Keeping this in mind, Bank Asia SME has for financing cottage, micro, small and our NGO Network) as short and long-term
stepped into the territories where no Bank medium enterprises (CMSEs) as a full- credit in agricultural/rural sectors. This
or FIs have reached so far. With 4 SME fledged commercial bank. Throughout financing helped to create enormous
Service Centers & 116 branches in urban & the year, we financed 330 entrepreneurs employment opportunities in farms,
rural areas Bank Asia provides its services in different CMSME clusters with the especially in the fields of crops & fisheries.
for promoting and expansion of businesses disbursement amount of Tk. 175 million. Total number of beneficiaries was 92,139.
which ultimately created productive new The department participated in “Banker-
off-farm employment. FINANCIAL INCLUSION IN
SME Women Entrepreneur Gathering ECONOMICALLY DISADVANTAGED
To take the financial accessibility to the & Product Fair-2017” organized by AREAS
unserved / underserved population across Bangladesh Bank and also in the
the country, Bank Asia focused on increase “Entrepreneur-Banker Match Making & Agent Banking
of market coverage and as a part of that Loan Disbursement program with Central With the objective of ensuring greater
objective to develop the MSEs from rural Bank” held at Tarail Kishorgonj, Maijdee financial inclusion and increasing the
level the bank opened 1,497 Agent Banking Noakhali, Comilla and Jessore. outreach of the services to the unbanked
outlet throughout the year 2017. We population, Bank Asia has introduced
In 2017, CMSE strongly focused on Agent Banking services as the pioneer in
introduced 4 fully agricultural branches to cottage & micro enterprise financing,
widen the access to finance and assist our Bangladesh. Our Bank made a unique
cluster financing, new entrepreneurship Agent banking module with technology
agro community with the most specialized development financing, promoting
and innovative banking solution available. based banking concept ensuring
rural people as well as rural women

Banker-SME Women Entrepreneur Gathering & Product Fair-2017 Vegetable field financed by Bank Asia

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Economic
Performance

appreciate security with real time banking Poverty eradication and reduce poverty will getting banking service from 8 districts.
for customers. The Bank has implemented level up to 10% within 2021. Government Already 32,748 beneficiaries are getting
1,497 Agent outlets in 62 districts in most wants to help the poor people by banking service in different remote areas.
geographically dispersed poor segment encouraging savings, providing grants,
FOREIGN REMITTANCE
of the society. During the year, the Bank engaging & monitoring their economic
Remittance is the second most important
provides Agent Banking services through activities as a group (Samitee) in each
sources of foreign exchange earnings for
Union Digital Centres, E-commerce village of Bangladesh. Bank Asia is now
Bangladesh, after readymade garments
solution to be established with the Agent operating EBEK Banking services for Phase
(RMG).Bangladesh’s foreign exchange
Banking network, introducing A-Card for I, II & III to 35 districts having 252 Upazillas
reserves hit a record high of USD 33.22
farmers to be benefited in their agricultural and 1,629,286 beneficiaries. This operation
billion at the end of December 2017.
productions, Mobile Application for Agent has spread over 21,816 villages of 2,424
However, country remittance inflows
Banking Customer (both in English and unions. Bank Asia provides online banking
reached at USD 13.53 billion in 2017,
Bengali). services through this EBEK project to
lower by 0.59% from 2016 whereas FRD
unbanked people with good reputation in
In 2017 Agent Banking deposit was remittance inflow increased by 23%
the above districts in Bangladesh.
Tk. 2,654.06 million through 311,947 (2017: USD 654 million and 2016:USD 532
With experience to implement of EBEK
accounts. We are determined to support million).
Project, Bank Asia is now capable enough
Government’s commitment in building to provide services to all government Bank Asia’s position was 8th in 2017 for
‘Digital Bangladesh’ as charted out in the projects like Social Safety net Programs. remittance collection among all Bank’s in
vision 2021 by bringing rural people under We will start full district coverage of Bangladesh where the Bank’s total wage
Agent Banking platform across the country Kishoregonj for Safety net payment where remittance inflow was USD 465 million
through our local and international more than 133,500 beneficiaries will get in 2017 with 11.24% growth from 2016.
partners for developing their lives and banking services from their own union. Bank’s total remittance collection agent
livelihood. We remain committed, and see We have another prestigious partnership network was 45 and 5 collection agent
it as its duty to the nation to facilitate and with UNDP under LGED Ministry named network are under our correspondence in
encourage various formal and approved SWAPNO where we have covered 2 2017. Mentionable that, this year Bank Asia
channels for providing convenient and districts and 76 unions for disbursing the awarded “Bangladesh Bank Remittance
accessible services, especially by bringing daily woman worker wages payment from Award-2016” for sending highest volume of
underprivileged sections and rural people their union. Cash for work is another Foreign Remittance through Bank Asia in
into the fold of basic banking services. prestigious program for Bank Asia which is 2016 by two remitters.
EBEK (Ektee Bari Ektee Khamar) runned by Ministry of Disaster.
Moreover, we have started another World’s ONLINE PAYMENT GATEWAY
Bank Asia is the leading Bank of
largest Non- Government funded mega SERVICES (OPGS)
implementing Ektee Bari Ektee Khamar
project named SHOUHARDO III with CARE Bank Asia is the first Bank to set-up
(EBEK) a government project for the
Bangladesh where’s 168,000 beneficiaries arrangement with OPGSPs in Bangladesh
ultra-poor people of Bangladesh focusing

Account opening for SHOUHARDO III project beneficiaries at Sreepur Union, Sundarganj Bank Asia & IFC signed agreement for providing Working Capital Solutions (WCS)
Upazilla & Gaibandha District Facility by IFC under Global Trade Finance Program (GTFP)

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173
 Economic
Performance

like ‘Payza’ and ‘Payoneer’ to bring Bank Asia is a major supporter of SMEs
hard earned money which is earned by across Bangladesh and invests in
exporting services in nonphysical form community programs, which enable youth
e.g. data processing, off-shore IT service, and those are less fortunate, to create
software development, business process brighter economic futures for them. In
outsourcing (BPO) etc. It is giving a strong 2017, total volume of disbursed MSME loan
competitive edge to Bank Asia over the is Tk. 42,720.72 million.
other players in the market by catering
FINANCIAL ASSISTANCE FROM
the banking need of an emerging sector.
GOVERNMENT
In 2017, we have done 1,626 transactions
Bank Asia does not receive any financial
and paid an amount Tk. 38.24 million
assistance from the government and
equivalent to USD 0.48 million through
also does not contribute to any political
‘Payza’ and 155,063 transactions
organization. But we support all the public
amounting Tk. 2,521.04 million equivalent
policy developed for the betterment of
to USD 31.31 million through ‘Payoneer’. nation and we never lobby for making any
policy in favor of us.
COMMUNITY INVESTMENT STRATEGY
With an aspire to ensure the Bank as a COMPLIANCE
socially responsible corporate entity, Bank Asia is very much conscious about
Bank Asia is always conscious of its legal and regulatory compliances. The
Corporate Social Responsibility (CSR) bank reports regularly to the central
contributing towards quality of life of the bank, the Bangladesh Securities and
society at large without compromising Exchange Commission, tax & VAT
ecological condition. In the year 2017, authorities on required compliance issues.
Bank Asia spent an amount of Tk. 183.83 During 2017, the bank has not faced any
million for the overall betterment of the significant penalties for non-compliance
nation. All the donations made under CSR with applicable laws and regulations
program for social and environmental for running its economic activities in
well-being and endeavor to ensure Bangladesh.
sustainable balanced growth in economic,
social and ecological arena. Bank’s
stakeholders were immensely benefitted
by way of its community based social
programs; education support Tk. 45.70
million, health support Tk. 13.18 million,
disaster management Tk. 82.60 million,
environment Tk. 0.33 million, sports Tk.
0.20 million, art & culture Tk. 0.50 million
and others Tk. 41.32 million.
INDIRECT ECONOMIC IMPACTS
As one of the leading financial services Community
provider in Bangladesh, Bank Asia has an Investment 2017
Million Taka
extensive role in the economy and society.
Bank Asia makes a positive difference to Education 45.7|25%
society and local, regional and national Health 13.18|7.17%
economies where we operate through our Disaster Management 82.6|44.93%
community initiatives and investments. We Environment 0.33|0.18%
help foster local economic development Sports 0.2|0.11%
and stimulate growth and innovation
Art & Culture 0.5|0.27%
through loans, credit and other financing
to organizations of all sizes. In particular, Others 41.32|22.48%

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Our Business Model
Infrastructure
Loan Asset
Equity Offer
Skilled Employees
IT Infrastructure
Bank License VALUE PROPOSITION
Knowledgeable
Directors and Deposit Product
Management Advance
Treasury
Off-shore Banking Unit (OBU) products
SME
CFC
Credit Card
Islamic Banking
Service Products
Consultation
PARTNERS Capital Market Operation
Products/Services
Investment Partners Remote Banking
Regulatory Agencies
Technology Agent Banking
Vendors
Stock Exchange
Other Banks
Government
CHANNELS
Branch Banking
Internet Banking
SMS Banking
ATM
Finance Website
Marketing
COST STRUCTURE Campaign
Interest expense
Capex & Opex
Salaries & Allowance
Software Maintenance
Branding and Advertisements
Other Expenses
SEGMENTS
Corporate
Mid Enterprise
Companies
Individuals
Remote Customers
KEY PROCESS MSMEs
Intermediation Government
Branch Operations
IT Operations International
Investment Banking
Online Banking
Alternative Delivery Channel
CAPABILITIES
Capital

Profit
REVENUE STREAMS
Interest Income
Investment Income RELATIONSHIPS
Fees & Commission Trust
Other Operating Income Customer Service
Automated Service
Personal Assistance
Advisory Service
Long Term Customer Relationship
Corporate Social Responsibility

Annual Integrated Report 2017

175
 Social Safety Net
Program

With experience of implementing of EBEK Services covered under this program

Project, Bank Asia is now capable enough Senior citizen allowances
to provide services to other government
projects like Social Safety net Programs Insolvent autism allowances
in collaboration with Social Welfare Payments for widow or divorced women allowance
Department under Ministry of Social Payments of freedom fighters allowance
Welfare.
Wages of road maintenance workers
Student stipends and related allowances
Food security allowances (Cash payments)
Teachers salary both government primary and non-government
high school teachers, and others

At a Glance Report of Bank Asia Social Payment is given below:

Local Govt.
EBEK EBEK Salary/
Particulars Social Safety net SWAPNO SHOUHARDO Total
(3 rd Revision) (Phase I & II) Allowance
Disburse
Districts 31 35 05 02 08 01 39
Upazillas 220 252 05 14 23 01 295
Union 2,200 2,424 12 76 115 10 2,637
Village 21,000 21,816 520 160 479 89 22,835
Beneficiaries 458,599 1,170,687 12,599 2,989 32,748 271 3,173,607

Account opening is going on for SHOUHARDO III project beneficiaries Social Safety Net (Allowance for Disabled) beneficiary getting banking
at Sreepur union, Sundarganj Upazilla & Gaibandha District seavice by putting his leg thumb at Zawar UDC , Tarail Upazilla, Kishoreganj

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176
Bank Asia officials providing old age allowance through biometric Providing Social Safety Net beneficiary allowance (Widow Allowance) at Isswaripur Union
authentication at Khshabari, Shoguna Union, Tarash, Sirajganj Digital, Shyamnagar, Satkhira

LGD wages & honorium payment (Chairman, Member, Gram Police) in presence Cash disbursement (UNDP Project) among the land slide affected people at
of UNO of Netrokona Sadar at Kailati Union, Sadar Upazilla, Netrokona Rangamati with the help of UNDP officials & local Government

Over the time we have made partnership with Social Welfare Department under Ministry of Social Welfare and providing services to
Senior Citizen, Widow and Disable beneficiaries. We will start full coverage of Kishoreganj district for Safety net payment where 133,500+
beneficiaries will get banking service from their own union. We have another prestigious partnership with UNDP under LGED Ministry
named SWAPNO where we have covered 2 districts and 76 unions for disbursing the daily woman worker wages payment from their
union. Cash for work is another prestigious program for Bank Asia which is run by Ministry of Disaster.
Moreover, we have started another World’s largest Non- Government funded mega project named SHOUHARDO III with CARE
Bangladesh where 168,000 beneficiaries will be getting banking service from 8 districts. Already 32,748 beneficiaries are getting banking
service in different remote areas.

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177
 Sustainable HR
Development
EMPLOYEE PROFILE MINIMUM NOTICE PERIOD REGARDING Employee distribution by Region
We strive to make Bank Asia a great OPERATIONAL CHANGES Region 2017 2016
workplace by creating a performance Minimum notice period before switching Dhaka 1,540 1,377
driven culture that rewards success and job is 3 months for regular employees
encourages employees to take control Chittagong 362 412
and 1 month for contractual employees. Sylhet 73 65
of their personal development. Through Minimum notice period before changing Rajshahi 43 45
the process of learning and rewarding
department is 1-30 days as per situation or Barisal 15 10
we intent to enable individuals to think,
behave, take actions and make decision demand of concerned branch/department.
Khulna 40 46
independently. TOTAL EMPLOYEES Rangpur 14 15
SALARY POLICY Out of total number of 2,087 employees, GENDER POSITIONING
We target a fair human resources 496 employees are female and rest 1,591 Bank Asia has been maintaining a
management by using a performance employees are male. As such, a profound very balanced male and female ratio,
based system. Our salary policy is same commitment is reflected in the Bank’s which was not only reflected in the
in all branches and service points for the employment policy and service rules. board of directors but also in the bank
beginner level. In addition, to drive further Bank’s employees are mainly concentrated management at different levels. Among
development of individual skill, increment on branches in terms of number and in
is given based on performance yardstick. our female colleagues 1 is in top level
2017 total employees’ composition in management, 28 in mid-level and 467 in
There is no incident of discrimination in branch and corporate office was 71% and
terms of remuneration provided to male low-level management.
29% respectively. Gender Positioning of Directors
and female employees.
TOTAL EMPLOYEES DISTRIBUTION 2017 2016
BENEFITS TO EMPLOYEES Board Level
Offices 2017 2016 Male Female Male Female
Every employee is paid salary on monthly
basis, which is a combination of basic Corporate Directors 5 4 9 3
641 29% 563 29%
salary, fringe benefits and other benefits office Gender Positioning of Employees
disbursed on 25 th of each month or Branches 1,480 71% 1,407 71%
Management 2017 2016
previous working day if 25 th is holiday.
Bank Asia’s benefit schemes are as follows: NEW EMPLOYEES Tier Male Female Male Female
239 new employees were recruited during Top Level 32 1 39 1
Fringe Benefit Schemes 2017, among which 44% for branches as Mid-Level 309 28 752 174
House rent allowance a part of network expansion of the bank Low Level 1,250 467 702 287
Conveyance allowance and remaining 56% for corporate office
Medical allowance to ensure effective and timely support to Gender Positioning by Grade
Entertainment allowance branches In a total of 2,087 employees, overall
House maintenance allowance male female ratio stands at 76:24 and
Utilities allowance Offices 2017 2016 non-executive segment has the highest
Car maintenance allowance Corporate concentration of female employees.
135 56% 67 32%
Other Benefit Schemes office 2017 2016
Position
Group health insurance Branches 104 44% 145 68% Male Female Male Female
Benevolent Executive 341 29 342 24
EMPLOYEES BY DIVERSITY
Leave fare assistance Non-Executive 1,233 467 1,151 438
Furniture allowance Bank Asia ensures equal opportunity as an
employer irrespective of locality, gender Support Staff 17 0 15 0
House building loan (HBL)
Car loan or ethnicity. Local employees (99.7%) Gender Positioning by
Provident fund loan dominated in diversity composition. Employment Level
Mobile phone allowance (talk time) Employee distribution by diversity Employment 2017 2016
Mobile handset allowance Officials 2017 2016 Level Male Female Male Female
Ex-gratia payment Local 2,081 1,964 Permanent 1,621 497 1,502 462
END SERVICE BENEFIT PLANS Indigenous 6 6
Age Distribution
Bank Asia provides the following benefit EMPLOYEES BY REGION Bank Asia has a relatively younger segment
plans to its employees on severance Bank’s employees are mainly spread in its overall employee pool where 58% of
or retirement according to individuals’ over Dhaka and Chittagong. It retains the the employees fall in 31-40 years age bracket.
entitlement highest number of employees in Dhaka,
Provident fund which was 74% in 2017 for corporate office Age Group Male Female Total
Gratuity
and branches in Dhaka city. 30 & Below 388 123 511
Superannuation
Leave encashment 31-40 871 330 1,201
41-50 298 40 338
51-60 34 3 37
Total 1,591 496 2,087

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Sustainable HR
Development

and 20% Organizational & Personnel Training by Gender

Top
6 Layers : 33 behavior factors are introduced. The benefits 2017 2016
Senior Vice President to President of using KPI are the followings: Position
Persons Hours Persons Hours
Male 1,946 44,946 1,790 38,170

Mid Female 514 11,872 607 8,048

4 Layers : 337
First Assistant Vice President to Current
Vice President state Training by Position
Position 2017 2016

Low
8 Layers : 1,717
Implemented Future Persons Hours Persons Hours
solutions state
Trainee Officer to Sr. Executive Officer Executive 386 8,915 762 7,838
KPI Non- 2,074 47,903 1,635 38,380
uses Executive
Employees Turnover Rate by Gender
Male and female employees’ turnover rate Training by Different Institutes
Proposed Business
is almost equal in terms of percentage. solution objective 2017 2016
Overall employee turnover rate is very low Particulars Nos. Hours Nos. Hours
in the Bank which is around 8.08% of total Quality of
requirement In House
employees in 2017. 2,435 56,618 2,267 40,968
Training
Bangladesh
2017 2016 26 376 87 1,868
Gender Bank
No. % No. % Reduce the number of decisions and BIBM 54 1233 110 1,880
Male 144 9.29 66 4.19 make decisions based on objectivity Overseas/
Female 20 4.18 13 2.73 and facts. Foreign 26 1218 33 928
Employees Turnover Rate by Region Quantify the achievement of goals. Training
As per demographic scenario, employees Training
Focus on facts and see where by other 70 1650 80 2,034
of Dhaka city left the Bank in 2017 which
individual improvement is needed.
was 82.32% of total employees left. institutes
As individual initiative grows, it Total 2,611 61,095 2,577 47,678
Region 2017 2016 becomes more difficult to remain as
Dhaka 135 66 close to the operational details as it is, Bank has organized 5 (five) foundation
in such case, KPI results can bring back training courses each 6 weeks long for
Chittagong 22 08
to reality. entry level employees to improve knowledge
Sylhet 03 02
base and proficiency in banking.
Rajshahi 01 01 Employees are clear about his/her
Barisal 01 00 obligations to deliver during the year BANK ASIA AND GREEN BANKING
Khulna 01 01 and accordingly would be able to plan As greening of mind, several trainings
Rangpur 01 01 to meet the expectation. were organized related to Green
Banking & Environmental Risk
PERFORMANCE MANAGEMENT SYSTEM Last but not the least, unbiased Management, Reporting format of
To facilitate the career growth of its performance evaluation at the end Green Banking activities, Financial
employees, Bank Asia emphasizes on of the year inclusion, CSR and Green Banking
fair evaluation of their performance and this year. In 2017, BAITD has provided
LEARNING AND DEVELOPMENT
its proper appreciation. As it is known, 5 trainings on Green Banking under
Knowledge and skill development is Foundation training course where 181
unbiased performance evaluation a continuous process and to keep our
culture plays a critical role in creating employees attended.
employees abreast of all the latest
a sustainable workforce while also developments in the banking sector, the Sustainability Report has been
supporting the Bank’s bottom line. bank continues to organize training and published since 2012 as per GRI
Bank Asia established a real-life SMART workshop to the officers and executives guidelines by Bank Asia. To create
KPI to evaluate the contribution of all in an effort to improve their professional awareness among the stakeholders
individuals in a transparent manner to efficiency. The bank always puts the each year the theme of Sustainability
assess quantitative and/or qualitative highest importance on training of its Report has been designed considering
performance vis-à-vis set target of a given employees as a continuous process of environmental issues of the world.
year. To evaluate the performance of With this consequence, the theme of
human resources development. Bank
Bank Asia’s employees KPI is used in the Sustainability Report 2016 was ‘Plastic
Asia Training Institute for Training & Soup’. Moreover the articles on green
following manner: Development (BAITD) is at new venue in
Bank Asia is solely depending on the banking were published in different
it’s own 6 storied building at lalmatia from newspapers reflectsing green initiatives
contribution of its existing talents. We have 2016 which is equipped with all modern by the Bank to our employees,
infused 80/20 strategy in performance study aid and course materials. stakeholders and all subscribers of
measurement system; as such 80% Objective those newspaper.
Annual Integrated Report 2017
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 Sustainable HR
Development

been taken with a perspective of focused has developed a software system named
During 2017, 14,371 proposals dealt improvement that gives hands-on Future Leader Application Software
through OCAS (Online Credit Approval involvement to all parts of the banking which is useful in managing the leaders’
System) have been developed as a and escalated learning both at home and databases and developing information
part of Technological improvement abroad. Through this program, a pool of that will produce as and when required.
of the Bank. This system will reduce talents is to be made from the officers of Total 208 participants from Executive
lead time, ensure accuracy, strengthen
Bank Asia who can confront any difficulties Officer to Assistant Vice President are
security and make accessibility easier
and will provide a competitive edge those lie ahead. By applying dynamic provided 1,664 man hour transformational
over other banks on online banking. learning techniques, this program strives leadership training at five phases during
to create a pool of skillful managers 2017 to boost up their leadership
In 2017, Electronic sanction archive prepared to effectively and rapidly make a expertise and compatibility and to have a
system has been developed for 6 genuine commitment to the association. positive productivity impact. Continuous
departments; namely: CRM, CMSE, Each officer of this program gets a chance leadership development program rewards
Islamic Window, SAMD, CFC & to be migrated to various capacities opportunities to grow and develop human
Agricultural wing. Total number of occasionally and into some strategic capitals.
sanction archived during 2017 is 14,300. capacities in the Bank to quicken the
learning procedure. Each of the members began the trip of
LEARNING VALUE CHAIN future pioneer improvement program with
LVC (learning value chain) is a value A total of 386 employees from the job a pledge of “Ready to Fight”.
creation framework that was learning and grades of Executive Officer to Assistant Vice
knowledge enhancement as strategic President of Dhaka and Chittagong region MATERNITY LEAVE
levers. LVC framework helps focus on L&D took part in the FLDP. Representatives take As per bank’s policy, any employee who
initiatives of an organization to contribute an interest in the program with eagerness has been in the continuous service of the
to the value chain of the same. LVC process and assurance which is unmistakenly bank for at least one year is entitled to
has the following 6 stages: obvious amid different leadership get 6 months maternity leave with regular
Business Needs Assessment salary and allowances. An employee
development sessions.
Learning Needs Assessment can avail this leave not more than two
Design & Development To facilitate FLDP more vividly Bank Asia occasions during the entire period of
Delivery service. The employee’s annual KPIs (Key
Reinforcement & Transfer of Learning Performance Indicators) and thereby
Results & Measurement

Bank Asia and BRAC signs MoU on

financial literacy to students
Under the agreement, Bank Asia will
provide different financial services to
students and teachers of schools through
BRAC Gonokendro which has been set
up inside school compound to facilitate
library and ICT support to students. The
agreed financial service include opening Training program on Transformational Leadership
of individual account, collection of fee for
students and management of payroll for
teachers.
Bank Asia and The Daily Star signs deal
on Knowledge Development
The Daily Star and Bank Asia, exchanged
and signed documents of a deal at The
Daily Centre in Dhaka. Under the deal
titled “Spreading Knowledge”, 1,000 copies
of the Daily Star will be distributed among
the students of Jahanagirnagar University.
Future Leader Development Program
The Future Leaders Development
Program (FLDP) is an activity which has

Bank Asia and BRAC sign MoU for providing financial literacy to students

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180
Sustainable HR
Development

increment, promotion are not affected for ENVIRONMENT Clients are considered as utmost priority
this long term leaves. Board and management of Bank Asia in Bank Asia. Their need fulfillment is
strongly believe that safe & healthy work the main concern among all exercises.
Maternity leave availing in 2017 place is a precondition for sound mentality Constant change and dynamic method of
Female employees each entitled to get 6 of employees to deliver desired services giving customer service to satisfy clients’
months as maternity leave. During 2017, 21 to valued customers. So the bank is very requirement is embraced. Bank Asia is
female availed total 3,769 days. careful about ensuring modern, healthy dependably a stage ahead to change
& safe workplace for its employees. All over its service into warm hospitality.
No. of female Average leave at a
the branches, SME service centers and In accordance with that, first day of
employees stretch
SME/agriculture branches and every every month has been chosen when all
21 180
department of corporate office are well individuals from top management take
Paternal Leave decorated having sufficient breathing vigorous initiative alongside all branch
As per bank’s policy, any employee who spaces and adequately equipped with fire- employees to give service to clients. Such
has been in the continuous service of the fighting equipment and fire drills. program encourages branch employees to
bank for at least one year is entitled to get 5 learn more innovative mediums of giving
working days paternal leave. An employee A team of logistics supports and services better customer service.
can avail this leave not more than two department of the bank is specially
entrusted to visit regularly to monitor Bank Asia Cricket Festival
occasions during the entire period of
cleanliness, safety measures and other Like every year, Bank Asia organized
service. In 2017, every entitled employee
amenities remain ensured in all outlets. intrabank cricket tournament where
has availed paternal leave facility.
If found any deviation, take prompt steps Branches and different Divisions
CHILD CARE CENTER FACILITIES and thus ensuring modern, healthy and and Departments of Corporate office
To improve our employees’ work family safe workplace for its employees. participated in friendly matches. In 2017,
balance, Bank Asia has established 37 teams under 8 Groups participated in
a combined day care center named this cricket festival.

260
“Pushpita” in collaboration with other
Bank Asia Cycling Club
private commercial banks by renting 5,666
With an aim to avoid the traffic situation in
square feet at Motijheel, Dhaka. To provide
Dhaka city, for maintaining physical fitness
a greater peace of mind to working parents
especially mothers and to encourage the Claims of and ensure greener economy for the future
Bank Asia voluntarily formed a ‘Cycling
inclusion of women in the job market,
the child care centre has established. insurance Club’ in the early 2016 for employee of
Bank Asia and city dwellers. In every
The baby sitter and teachers are very

Tk. 8.99
month a cycling rally has been organized
educated. Children (2-5 years) are getting
along with different sports program where
pre schooling education from the teachers.
CEO & Senior Management Team also
Parents who will keep their babies in
participates. In future Bank Asia Cycling
the center will get the opportunity to
watch their babies in their device from million club will go forward to build a Banker’s
community where everyone will intend to
anywhere, any time through Live CCTV Cleaning Day
use cycle for day to day transportation.
footage. The target number of Children Bank Asia has developed its status for
is 60. The age limit of the babies will be 6 tidiness and well maintenance of Branch Bank Asia Debating Club
month to 6 years. Equipped with a skilled premises and Corporate Office. Tidiness is a Bank Asia Debating Club has started
staff and a child friendly environment, basic piece of our way of life. Safeguarding its journey in 2017 in order to create a
working mothers of Bank Asia no longer of vouchers, records and other office sociable atmosphere among the members
have to decide between quality care archives are additionally as essential as of debating club within Bank Asia. The
for their children and going to work. tidiness. The costly interior decoration President of Debating Club is Md. Arfan
Currently the Day Care center consists of and expensive furnishings end up looking Ali, President & Managing Director of Bank
28 babies, among them 2 are from Bank plainly vain unless the premises are kept Asia. Aims and objectives of the club are
Asia’s employee. There are 5 nannys, 3 up all around. The administration, thus, to provide a forum for debate, to improve
teachers, 1 supervisor and 1 security guard chose to watch ‘cleaning day’ on the presentation skill, public speaking skills,
for overall maintenance of the center. ‘first saturday’ of each alternative month negotiation skills. Also improving mutual
Moreover, one bank representative also where all employees of the branch and the understanding, cultural orientation,
engaged in the day care center. Corporate Office work together to clean respecting others opinions, absorbing
their respective desk, furniture and fixture. the negativity, learning from opponents,
OCCUPATIONAL HEALTH, SAFETY AND
enriching self confidence, banking
Customer Service Day
knowledge, implication of finance and

Annual Integrated Report 2017

181
 Sustainable HR
Development

Prize giving cere-

mony of Bank Asia
Debating Club

monetary policy in banking business and

forced or compulsory labor. In 2017, no With a view to resolve undesirable
community issue .
incident of discrimination and violation issues at the workplace in the most
involving rights of indigenous people and effective manner Bank Asia has formally
CULTURAL EVENTS AND AMUSEMENT
forced and child labor has been recorded. promulgated Grievance Handling Policy
Bank Asia Pitha Utshob in 2014. The policy equally applies to all
GRIEVANCE REDRESSAL POLICY
(Rice Cake Festival) permanent and contractual employees for
For building awareness regarding human
The season of winter is always considered grievances related to promotions, transfer
rights among the employees in the bank,
exceptional in our country and we and posting, compensation package,
Bank Asia formulates
celebrate it with pitha & date juice that incentive bonus, working environment etc.
Female anti-harassment policy
has become our age long tradition. On Under thispolicy, complaints are resolved
Grievance handling policy
the eve of New Year, Bank Asia Limited informally where possible, and through
always arranges for Pitha Utshob keeping Female Anti-harassment Policy a formal grievance procedure where
conformity with our culture and to create Bank Asia follows a zero tolerance necessary.
a common ground for all employees to approach to harassment of any kind to
ANTI-MONEY LAUNDERING TRAINING
come and exchange pleasantries. Bank any female employees as the Bank feels
Bank Asia is committed to prevent money
Asia Pitha utshob is marked for a new harassment seriously weakens the working
laundering and terrorist financing. We
beginning of the year with a note of atmosphere. The policy guides about
recognize our obligations to prevent the
positivity and festivity. personal measures of affected female
financial channels and products from
employees in addressing a complaint, role
Transport Facilities being used by money launderers and
of management, investigation procedures
At present 14 vehicles used for pick terrorist organizations for illicit purposes.
and disciplinary measures. The policy also
and drop facility specially for female Bank Asia is also against any actions of
guides management about its role in case
employees of Bank Asia in Dhaka and soliciting, collecting or provisioning funds
of false complaint.
Chittagong region where majority of that come with the intention to support
the pool vehicles have been converted Grievance Handling Policy terrorist acts or organizations.
into CNG driven. Bank Asia provides full- Anti-Money Laundering Department
fledged transport facilities for employees (AMLD), Corporate Office always arranges
during and beyond usual working hours.
HUMAN RIGHTS, CHILD LABOR AND
OTHER ISSUES
Human Right issue is particularly
relevant for organizations that operate in
industries/ regions where the protection
of human rights is of significant concern.
As this is a significant concern for a
business to be sustainable in long term,
we integrated the human right issue in all
our economic decisions. Including human
right provision in all kinds of investment
agreements is a part of our strategy to
reduce the risks of investment. And also we
do not make any investment agreements
and contracts that violate human rights.
Bank Asia also does not tolerate child, Bank Asia Women’s Day Celebration

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Sustainable HR
Development

and conducts AML workshops to train all PRACTICES RELATED TO CUSTOMER of measuring customer satisfaction. In
the employees of our Bank and about 98% SATISFACTION 2017 we have arranged 3 trainings of
of total employees (Branch/Corporate Delivering high quality customer service 106 employees on different aspects of
Office) obtained AML & CFT related is one of the top priorities of Bank Asia. customer service consisting of 848
training. To maintain customer service standard man-hours of training to improve our
of the bank, acquiring of new clients, human capital for serving better
AML/CFT Training 2017
doing more business with existing clients, customer service.
No. of employees % maintaining high client retention rate and
1,906 98 lower client attrition rate all are correlated. STATEMENT ON COMPLIANCE
Properly constructed customer satisfaction In the year 2017, Bank Asia has been
As a result, officials become aware and able to comply with all the regulations
conscious regarding AML & CFT matters. surveys may provide the insights that are
very much essential for feeling the real. of Bangladesh government regarding
POLICY, PRACTICES, AND PROPORTION In this regard, Bank Asia approved a new use of product and services, information
OF SPENDING ON SUPPLIERS customer service policy in 2014. about product and services, marketing,
For running day to day operations Bank communications, advertising, promotion.
We took initiatives to conduct customer No incidents of fines/penalties have been
Asia works with a wide range of suppliers
survey on the basis of their satisfaction recorded this year concerning the above
and maintains good relationship with
over the product & services that we offered mentioned issues.
them. We work to create value through
to them. In 2017, we conducted surveys
collaboration with them and strive for Our bank always maintained the
on Call Center Performance in August
fairness in all interactions with suppliers. fundamental principle of business
and December respectively. 75 Calls were
Our chain of suppliers consists of the regarding protecting customer privacy.
made and the data were recorded using
following parties: Customer’s information/ data is not
the MSS method. We intended to find out
Construction contractor available to anyone other than the
Graphics and interior designers to the extent we can improve our service
quality to retain the customer satisfaction client himself and the Banks concerned
Advertisement agency
and enhance it further. The Survey ensued personnel who is responsible for
Newspaper
Printing maintenance in momentous finding that aided Bank maintaining the data. We haven’t received
Stationary suppliers Asia in elevating its performance from 77.2 any complaints relating to breach of
Mineral water suppliers to 80.5 on a scale of 100 leveling the peer customer privacy and loss of data.
Transport facilitator bank average and opening up bright scope
ATM, hardware, software service to improve the customer experience and
providers relationship management.
Nursery
Security agency
The Scoring Index was distributed amongst
Selection of supplier is managed centrally Staff Performance (SP), Communication
by the corporate office. The bank applies Channel Status (CCS) and Turn Around
its own policy and practice for selecting Time (TAT) with the weightage of 60, 15
these suppliers. It mainly takes into and 25 respectively.
account the following criteria before From 48.5, Bank Asia marked an
selection: improvement to 50.7 in Staff Performance
which contributed to the overall
Status of compliance with government development of Bank Asia’s customer
rules and regulation by the suppliers.
oriented Call Center performance. With
Our bank doesn’t make any proper training and attention, Bank
collaboration with suppliers Asia marked notable improvement in
that employs child labor, creates Professional Conduct, Product Knowledge,
environmental hazards, violates human and Call Closing Skill in Staff Performance.
rights etc. While significant enhancement was
We fully maintain these criteria in case observed in eliminating noise behind the
of selecting suppliers. Bank Asia has a agent in CCS and Attempt to Connect with
number of security service providers Queue Waiting Time in TAT.
which specialize in all aspects of building
security. All security providers practice Therefore, it is mentionable that our
the highest standards of training and customers can always inform us on their
operation. Their training incorporates all expectations via different channels (i.e.
aspects of the law including human rights via e-mail, letter, personal visit etc.) The
and non-discrimination. bank has an in-house policy and practice

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183
 Bank Asia Foundation

With a view to implementing the guidelines of Bangladesh Bank for conducting larger Corporate Social (CSR) Activity through
Foundation, Bank Asia Foundation has started its journey after its registration with Registrar of Joint Stock Companies & Firms in the
year 2014. Initially it took a while for planning for the implementation of the project. The foundation got momentum after appointment
of its Executive Director in the year 2017. The Foundation started operations from February 2017 in limited scale. In fact, the Foundation
will henceforth carry out activities which the Bank had so long been performing in systematic, structured and sustainable manner.

The Foundation has embarked upon a plan to construct a 250 bed hospital cum medical college at Malkhanagar, Munshigonj. Mr. A
Rouf Chowdhury, Chairman of Bank Asia and Bank Asia Foundation and his family members have donated 700 decimal and a 3 storied
building for the proposed Hospital. It is intended to extend the building by two more floors and for this, necessary engineering study
was carried out and as built architectural and structural design is under process.

The Foundation has completed the detailed exercise and finalized the list of 205 students for Bank Asia Higher Studies Scholarship for
the year 2017. The distribution of scholarship money has already started.

The Foundation organized a medical camp at Malkhanagar in April 2017 in collaboration with Ad-din Hospital and provided free
consultation, prescription and medicine to 2,154 poor villagers of the locality. The Foundation organized a voluntary Blood Donation
program at the roof-top of Bank Asia’s Corporate Office in December 01, 2017.

The activities of the Foundation, amongst others, will be the following:

1. Providing treatment facilities through of hospitals, clinics, medical & eye camps;
2. Providing scholarships to poor and meritorious students;
3. Distributions of blankets and winter cloths among the poor & distressed people;
4. Providing/rendering monetary and/or other help/assistance for the relief of people affected by natural and other calamities
such as food, fire, famine, cyclone, earth-quack, storm, accident, pestilence, drought, epidemic etc.;
5. Promoting educational, scientific, religious and social activities/organizations and
6. Other similar charitable activities.

Mr. A Rouf Chowdhury, Chairman of

Bank Asia handed over a cheque to Mr.
Aminul Islam, CEO of BA Foundation
from Bank’s Islamic Banking unit for so-
cial welfare and charity works through
the Foundation

Blood Donation Program for observing

18th anniversary of Bank Asia

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184
Corporate Social
Responsibility (CSR)
Corporate Social Responsibility (CSR) refers
to self-regulatory mechanism whereby
a bank ensures its active compliance with
the spirit of the law, ethical standards and
national or international norms.
Bank Asia’s social responsibility in
Bangladesh runs with the aforementioned
philosophies which are framed by the
Board of Directors of our Bank.
Bangladesh Bank CSR Guideline is the
guiding principle in designing our CSR
roadmap. Bank Asia prioritizes on long-term Bank Asia’s Higher Studies Scholarship Program
programs rather than the short-term ones
that have sustainable and lasting impact on
the people and society of the country. Donation for Societal Improvement by CSR in matrix:
Million Taka
At Bank Asia, employees work with
Percentage with
a greater mission. They are motivated to Initiatives Donation (in million Taka)
total amount
contribute to the bank’s social initiatives like
donation to build school building, warm Education 45.70 24.86%
clothes distribution and blood donation. Health 13.18 7.17%
Employees’ passionate involvement in CSR Disaster Management 82.60 44.93%
adds new dimensions to the bank’s CSR
portfolio. During 2017, Bank Asia spent an Environment 0.33 0.18%
amount of Tk.183.83 million for the overall Sports 0.20 0.11%
betterment of the nation. Art & Culture 0.50 0.27%
Others 41.32 22.48%
Total 183.83 100%

Education
Bank Asia Higher Studies Scholarship
One of the major CSR activities of Bank Asia Ltd. is Higher Study Scholarship program for rural poor and meritorious students, who are
studying in public universities. The Bank initiated the program in 2005 for those students who have merit and dream to serve society, but
not have the means to pursue higher studies. The scholarship is given through the Bank’s rural branches on the basis of SSC and HSC
results. Bank Asia has provided the scholarship for 1,545 students. Each of the students gets Tk.51,000/- annually as scholarship. In the year
2017, Bank Asia spent around Tk.45.70 million for direct scholarship and educational infrastructural development purpose.

Initiatives Taka
BA Higher Studies Scholarship 26,823,500
Infrastructural Development of Nursing Student Hostel (BSMMU) 5,739,950
Infrastructural Development of Begum Badrunnessa Govt. Women College 3,100,000
Holy Family Red Crescent Medical College & Hospital 2,491,970
Dr. S.K. Majumder Agriculture & Technical College 200,000
Providing The Daily Star among meritorious students all over Bangladesh 7,311,190
Total 45,666,610

Bank Asia supports construction of a Nurse Hostel in the BSMMU

Bank Asia is extending entire financial support for construction of an eight-storied `Nursing Student Hostel’ at Bangabandhu Sheikh Mujib
Medical University (BSMMU) to take the edge off acute accommodation problem of graduate nursing students. In this project Bank Asia
spent Tk.57.40 million in 2017 for construction purpose.

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185
 Corporate Social
Responsibility (CSR)

Sharing Knowledge
as a CSR initiative
The Daily Star, the highest circulated and
prestigious English daily in the country, Donation to Prime
has been organizing various activities Minister’s Relief
on knowledge development aiming to Fund for Rohingya
refugees
make a tangible change in the society. As
part of such initiatives, the national daily
plans to provide newspaper copies to Initiatives Taka
meritorious students in different reputed Curative treatment of 9 individual patients 1,477,028
public institutions. As a part of their Contribution to Child Day Care Centre 400,000
knowledge development activities, Bank National Heart Foundation, Sylhet 10,000,000
Asia providing 1,000 copies of newspaper Proposed Hospital in Sirajdikhan,
1,676,990
everyday under a joint venture initiative Malkhanagar
titled “Sharing Knowledge as a CSR Total 13,554,018
initiative” and in 2017 Bank Asia provided
Tk.7.32 million for the purpose. Proposed Hospital at Makhanagar, Sirajdikhan, Munshigonj
With a view to implementing the guidelines of Bangladesh Bank for conducting larger
Corporate Social (CSR) Activity through Foundation, Bank Asia Foundation has started its
Health
journey after its registration with Registrar of Joint Stock Companies & Firms in the year
Blood Donation program
2014. Mr. A Rouf Chowdhury, honorable Chairman, Bank Asia and Chairman, Governing
The members of Bank Asia formed Bank
Body, Bank Asia Foundation, has recently donated a huge quantum of land along with a
Asia Donor Group. The objectives of
three storied building at Malkhanagar, Sirajdikhan, Munshigonj for establishing a hospital,
the group are to donate blood when
renovation and interior work of which is underway.
and where necessary, donate eye
posthumously, promote and encourage
all levels of people to come forward to
this priceless donation. Already about 100
members formally joined the donor group
platform and started donating blood.
Every year this group arranges a blood
donation program and collected blood
donates to Bangladesh Red Crescent
Society.

Other health related donations

National Heart Foundation
National Heart Foundation, Sylhet,
a non- government, service- oriented and
a nonprofit organization and also
a member of the World Heart Federation
where Hon’ble Prime Minister of the
Government of Bangladesh is the chief
Patron of the Foundation. Considering the
goodwill of National Heart Foundation and
there effort to serve the people, Bank Asia
stands beside them by contributing Tk. 10 Child Day Care Center of Bank Asia
million for a post CCU at the hospital.

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186
Corporate Social
Responsibility (CSR)
Disaster Management
Bank Asia is committed to the welfare of the community at large.
The Bank responds promptly to support the affected humanity.
In 2017, the Bank distributed warm cloths among cold-hit
people in different parts of the country during severe cold spell
of winter to carry out its humanitarian activities and also to
support flood-hit people. For this purpose the Bank donated
Tk.82.6 million in 2017.

Initiatives Taka
Support to Rohingya refugee 50,000,000
Support to flood-hit & cold- hit people 32,600,000
Total 82,600,000

Sports
During 2017 Bank Asia contributed Tk.0.20 million to the
Bangladesh Bridge Federation as sponsorship of World Cup
Bridge-2017 and also organized different encourage in house
tournament for encouraging the employees of Bank Asia.
Opening ceremony of Bank Asia Cricket Festival 2017
Arts & Culture
Bank Asia always supports promotion of art and culture. The Bank distributed Tk.0.50 million among Aranyak Natyadal
(Sponsorship), Gallery Shorrong Dinajpur for Organizing 4th Shishu Kishor Fine Arts Exhibition (Sponsorship), Shibgonj
General Library for purchase books, and construction of Sahaba Jame Mosque.

Initiatives Taka
Sponsorship to Aranyak Natyadal 100,000
Sponsorship for Gallery Shorrong, Dinajpur 100,000
Shibgonj general library for enrich cultural knowledge 200,000
Shahaba Jame Mosque 100,000
Total 500,000

Other Social Projects

In 2017, Bank Asia donated/ sponsored/ spent Tk.40.90 million on the occasion of social project including Bangladesh Science
Fiction Society, Bangladesh International Arbitration Center, Prime Minister’s education assistance trust & suchona foundation,
Notre dame College 3rd National English Carnival, Sir William Beveridge Foundation, BDR victim Family to help government to
carry out its humanitarian activities smoothly.

Initiatives Taka
Prime Minister’s Relief Education Assistance Trust & Suchona Foundation 40,000,000
Notre Dame College 3rd National English Carnival- 2017 345,000
Financial support to Ms. Rashida Kabir Reba, widow of one of the bereaved families of 480,000
martyred Army officials killed in BDR munity
Sir William Beveridge Foundation 90,000
Total 40,915,000

Annual Integrated Report 2017

187
 Customer
Satisfaction Survey
Bank Asia puts the highest emphasis on its customers and in order to learn about the
Service Quality of its call centers, the bank ran two surveys using phone calls on August Overall SQ Score (Wgt. 100)
and December of 2017 to have a keen follow-up on the overall improvement of Service Benchmark Bank's Score (BBS)
Quality rendered by the call center. Peer Bank Aver. (PBA)
BA (Aug'17)
BA (Dec'17)
Identify areas of
improvement for BA

83.60

2 81.20
80.50
Track call center (CC)
SQ performance of Bank
Asia (BA)
77.20

1 Objective 3

Assessingthe impact of training Out of 100 Bank Asia scored 80.5 which
and further training needs
was marginally below than the Peer bank
Objectives of the survey Average (PBA). The Overall SQ score im-
The underlying objectives for conducting the survey were: proved in December due to recuperation
in Staff Score which is higher than PBA
Survey Methodologies but a little below than the Benchmark
To conduct the survey, 75 calls were made during the research tenure using the MSS bank’s Score (BBS).
data collection method. One month was taken as the duration for the research which
was followed by rigorous training to curb the scope for grills.
Activities that were taken into consideration for the follow-up of improvement are: Staff Score (Wgt.60)
BBS
PBA
Query about Query About Query about
Branch/ATM Internet Loan BA (Aug'17)
A/c Opening Query Location/ Banking/ Products
Contact Details Smart App BA (Dec'17)

53.20

50.70
50.30
A/C Balance Credit Card Credit Card Credit Card Query about
Query Features Opening Bill Query Deposit
Related Query Products
48.50

The Scoring Index was distributed amongst 3 factors with respective weights.
Bank Asia scored 50.7 out of 60 in Staff
Staff Performance (SP)
Index which was almost close to PBA
and slightly below BBS. Staff Score
improved in December’17 compared to
August’17 due to different product and
60 Communication
soft training facilities which significantly
contributed towards the enhancement
Channel Status (CCS) of product knowledge, conversion clos-
15 ing skill and professional conduct.
25
Turn Around Time (TAT)

Bank Asia Limited

188
Customer
Satisfaction Survey
Communication Channel Inference
Overall Score of SQ improved by 3.3 in Dec’17 compared to Aug’17 driven by mainly Staff
Status (Wgt. 15) Score in Professional Conduct, Conversion Closing Skill and Product Knowledge.
BBS
PBA
BA (Aug'17)
BA (Dec'17)

14.60
13.00
12.00
PD
11.50
Dispute management
(professional conduct)
Right answer to queries
(Product knowledge)
Asking any help is required
Bank Asia registered below the par
performance in August only to improve (Conversation closing skill)
the condition to be next to PBA and
marginally below than BBS in December
2017. CCS score improved by curbing the
Noise behind the agent that contributed
to lower performance in August survey.
The bank still has a lot of scope to up-
grade the performance by enacting more
improved noise control and intensifying
Voice Clarity Score.

Turn Around Time (Wgt. 25)

BBS
AOL
PBA
Proper addressing (Greeting Skill)
BA (Aug'17)
BA (Dec'17) Showing attentiveness (Listening skill)
21.30
Uttering banking jargon (Speaking skill)
17.90 17.80 17.70 Explaining reasons for making customer
hold (Politeness & Courtesy)
Requesting to call for any other banking
needs (Conversation closing skill)

Bank Asia Scored 17.7 in Turn Around The Performance Drivers (PD) and Areas of Improvement (AoI)
Time (TAT) yardstick in December 2017 as found by the survey.
which was close to PBA and below BBS.
Training improves Queue Waiting Time, Considering the Benchmark Bank’s Score and Peer Bank Average Score, Management
Attempt to Connect and Call Holding of Bank Asia has managed a marked improvement in its call center service quality
Time. There is an improvement scope in rendering planned training facilities to be a more customer friendly bank in the bank-
Call Connection Time and Query Manage- ing industry.
ment Time to revamp TAT.

Annual Integrated Report 2017

189
 Market
Performance
Availability of information
about BANK ASIA
Annual Integrated Report 2017 and
other information about Bank Asia
may be viewed on Bank’s
Website: www.bankasia-bd.com

Corporate Office
Rangs Tower(3rd Floor)
68 Purana Paltan, Dhaka-1000
Phone: 47110278

E-mail: bankasia@bankasia-bd.com

Financial Calendar Announced On

Audited Consolidated result for the year ended 31 Bangladesh Capital Market
April 16, 2017 witnessed a bullish trend
December 2016
Unaudited Result for the first quarter ended 31 throughout the year in 2017. The
April 27, 2017 reason for the bull market was
March 2017
revived investors’ confidence
Unaudited Result for the second quarter and
July 27, 2017 derived from strong year-end
half year ended 30 June 2017
earnings and higher dividends
Unaudited Result for the third quarter ended 30 October 29,
coupled with positive economic
September 2017 2017
outlook. Moreover, institutional
and individual investors were
seen active for injecting fresh
funds in the market because of
Distribution of Dividend Details low returns from the deposits of
(Cash% - Stock %) 12% Stock financial institutions during the
Announcement Date April 16, 2017 period. The bullish market helped
Record Date May 18, 2017 investors in recovering the losses
Distribution Date July 13, 2017 they had incurred during the
Notice of 18th Annual General Meeting May 15, 2017 market crash of 2010 and 2011
which was continued over last
18th Annual General Meeting July 03, 2017
three years. The prime index of
the Dhaka Stock Exchange (DSE),
DSEX started the year with 5,036.05
points from January and ended
Stock Detailed the year with 6,244.52 points with
Particulars DSE CSE increase of 1,208.4 point or 23.99%.
Stock Symbol BANKASIA BANKASIA Total Market capitalization of
Company ID 11127 22022 Dhaka Stock Exchange stood at TK.
Listing Year 2004 2004 4,234.24 billion as on December 31,
Market Category A A 2017 from TK. 3,412.44 billion as on
Electronic Share Yes Yes December 31, 2016 representing a
growth of 24.1%. The daily average
Total Number of Securities 987,011,099 987,011,099
turnover in 2017 was TK. 8,748.38
million against TK. 4,944.28 million
Year End Closing Price on December 28, 2017: Tk. 23.10
in 2016. Foreign investors’ turnover
DSE Trading Days in 2017: 248
on the DSE also increased by
30.48% to total at TK. 114,476.3
million in 2017 compared with that
of TK. 87,733.30 million in 2016.

Bank Asia Limited

190
 Market
Capitalization
Million Taka

25,748
22,800
20,073

15,953 15,775
13,848

13,557 12,742
9,153

2009 2010 2011 2012 2013 2014 2015 2016 2017

Market price of
Bank Asia Share-201 7
Per share value in Taka

21.20 20.16 20.80

19 24.60
18 18.9 18.6 23.10
17 17.2
16.2

Jan Feb Mar Apr May June July Aug Sep Oct Nov Dec

Daily Trade Volume of Bank Asia

12,000,000
10,000,000
8,000,000
6,000,000
4,000,000
2,000,000
-

Annual Integrated Report 2017

191
 Stakeholders Relationship/
Grievance Redressal

Bank Asia strongly believes in maintaining PROCESS REDRESSAL CHECKLIST Yes No

smooth and interactive relationship with
the stakeholders. We pursue high quality queries/ complaints/ Shareholders are properly communicated for
stakeholder’s redressal policy proactively grievance lodged by collection warrants which have been refunded
to handle all types of grievance, shareholder for non-delivery by the courier
complaints in an effective and fair manner. Dividend warrants Revalidate the upon de-
mand
Review all logs objectively
Bank Asia strongly believes in equitable and fairly and give solution Bank account information are corrected while
treatment to every shareholder. We resolve within a short time frame sending dividend through BEFTN system
any shareholders’ complaint on a priority Dividend warrants are reissued in case of
basis and have committed to serve the failure to send dividend through BEFTN system
appropriate mechanism to address the Send intimation to concerned Issue shareholding certificate, dividend certifi-
shareholders’ grievance within the time shareholder after redressal by cate as and when required
frame stipulated by the Bank. share department e-TIN number is collected in case of cash
dividend
SHAREHOLDER’S PERSPECTIVE Any Investors may lodge their complaint Revalidate the dividend warrants upon
Bank Asia redressal system covers the related to their investment in the company demand
following issues through formal letter, Bank’s official e-mail Correction of bank account information
ID i.e. bankasia@bankasia-bd.com and while sending dividend through BEFTN
Receiving the complaints for non- phone call to the Company Secretary system
receipt of dividend warrant, dividend and/or Share Department. We focus in Re issue of dividend warrants, in case of
intimation letter, cash dividend; addressing those complaints within the failure to send dividend through BEFTN
Transfer of shares from suspense shortest possible time. system
account to the shareholders BO Issue shareholding certificate, dividend
account; Redressal process of Bank Asia Limited certificate as and when required
Clarification of any price sensitive Complaints raised by the investors/ E-mail or letter must be send to all the
information over telephone; shareholders must be dealt with investor who have submitted written
Grievance for not receiving of Annual courtesy and in a timely manner complaints
Integrated Report, half-yearly financial Complaints are treated and solved Request for e-TIN number in case of
position timely; efficiently and treated fairly cash dividend
Concerns relating to share Communicate to the shareholders for
dematerialization (DEMAT); collection of the dividend warrants
Queries about and clarification on which have been refunded for non-
recent or upcoming price sensitive delivery by the courier
information over telephone, etc.

Redressal point for

Shareholders
Bank Asia Limited
Share Department
Corporate Office
Rangs Tower (2nd Floor)
68 Purana Paltan
Dhaka-1000 General
Phone: 7110062 (Ext. 301) Shareholders
at 18th AGM

Bank Asia Limited

192
Redressal Statistics 2017
Requests received from shareholders Ways of addressing mentioned requests
Demat 461,150 shares; Demat confirmed 461,150 shares timely;
6,108,035 bonus shares credit among 98 98 request responded;
shareholders from suspense account
Re-issue 4(four) dividend warrants; 4 (four) duplicate dividend warrants issued;
Issuance of 111 shareholdings certificate 111 shareholdings certificate
for income tax purpose; were issued;
The bank continues to have regular communication with the shareholders through periodic updates of
performance and at any time when it believes it to be in the best interest of shareholders generally.

CUSTOMERS’ PERSPECTIVE EMPLOYEES’ PERSPECTIVE

Customers are one of the key stakeholders Employees are the main resource of
of the Bank. We are very much conscious the Bank, the human capital. We are
about customers’ demand and always committed to provide comfortable
ready to serve them our best as per our work environment to our employees for
Customers Service Policy and Customers enriching their productivity. To resolve
Acceptance Policy (CAP). Like investors we undesirable issues in the workplace and
also address up our customers queries and create a conducive and gender sensitive
complaints through our corresponding working environment we have separate
department, division or unit. All the Grievance Handling Policy and Female
complaints are centrally handled by BOD Anti- Harassment Policy. Our Human Shareholders
(Branch Operation Department). In 2017, Resources Department takes necessary
the Bank received 78 complaints from measures to redress if any adverse
customers of various branches and all the situation arises. In 2017, we didn’t receive
problems were solved successfully through any complaints related to our employees.
proper investigation and remedial action.
Those problems were solved within 5 days Redressal Policy
(approx.) in which some complaints were
met up within 24 hours.
Employees Customers

General Shareholders at 18th AGM

Annual Integrated Report 2017

193
 Corporate
Governance The table below gives an overview of the
locations of our Corporate Governance

Page No
Report on the Activities of Audit
198-199
Committee
Statement of Directors on adequacy on
200
the system of internal control
Statement of Directors responsibility to
establish appropriate system of Internal 200
Control
Chief Executive Officer and Chief
Financial Officer’s Statement of 201 Internal
responsibilities for the year 2016 Control
Preface 202
Board of Directors Chairman and CEO 202-209
Vision, mission and strategy 209
Audit Committee 209-210 Integ
Objective and Activities of
209-210
Audit Committee
Internal control & Risk management 210-211
Ethics and Compliance 211
Remuneration Committee 212 Independence
Human Capital 212-216
Communication to Shareholders and
216
Stakeholders
Environmental and Social Obligations 217
Corporate Governance compliance
221
certificate
Corporate Governance disclosure
checklist in line with:
• BSEC Notification
223-243
• The Companies Act 1994
Bangladesh Bank BRPD Circular 11,18
and 19 issued on October 27, 2013

Bank Asia Limited

194
 Ethics

Risk
Management

grity Transparency

Leadership

Corporate Governance
Subsistence of good corporate governance reduces risk, stimulates performance,
improves access to capital markets, enhances the marketability of goods
and services, improves leadership, demonstrate transparency and social
accountability. We are committed to operating in accordance with best practice
in business integrity and ethics and maintaining the highest standards of
corporate governance.

Annual Integrated Report 2017

195
 Corporate Governance Disclosure Checklist(In line with
South Asian Federation of Accountants (SAFA) Guidelines)
Compliance Ref Page
SL Items
Status No
1 BOARD OF DIRECTORS, CHAIRMAN AND CEO
20-25,
1.1 Company’s policy on appointment of directors disclosed
202-203
Adequate representation of non-executive directors i.e. one third of the board, subject to a
1.2 ✓ 205
minimum of two
At least one independent director on the board and disclosure/affirmation of the board on such 20-25,
1.3 ✓
director’s independence 199, 205
1.4 Chairman to be independent of CEO ✓ 206
Responsibilities of the Chairman of the board appropriately defined and disclosed. Disclosure of
1.5 ✓ 206
independence of Non-Executive Directors
Existence of a scheme for annual appraisal of the boards performance and disclosure of the
1.6 ✓ 206
same
1.7 Disclosure of policy on annual evaluation of the CEO by the Board ✓ 25, 207
Disclosure of policy on training (including details of the counting training program) of directors
1.8 and type and nature of training courses organized for directors during the year existence of a ✓ 204
scheme for annual appraisal of the boards performance
At least one director having through knowledge and expertise finance and accounting to
1.9 provide guidance in the matters applicable to accounting and auditing standards to ensure ✓ 20-25, 204
reliable financial reporting
Disclosure of number of meetings of the board and participation of each directors (at least 4 20-25,
1.10 ✓
meetings are required to be held) 203, 218
Directors issue a report on compliance with best practices on corporate governance that is 217, 221-
1.11 ✓
reviewed by external auditors 243
2 VISION/MISSION AND STRATEGY
Company’s vision/mission statements are approved by the board and disclosed in the annual
2.1 ✓ 8-9, 209
report
2.2 Identification of business objectives and areas of business focus disclosed ✓ 9, 209
2.3 General description of strategies to achieve the company’s business objectives ✓ 13, 56, 209
3 AUDIT COMMITTEES
109, 209,
3.1 Appointment and Composition ✓
218
Whether the audit committee chairman is an independent Non-executive Director and 22, 199,
3.1.1 ✓
Professionally Qualified 209
Whether it has specific terms of reference and whether it is empowered to investigate/question
3.1.2 ✓ 209
employees and retain external counsel
3.1.3 More than two thirds of the members are to be Non-Executive Directors ✓ 209, 218
All members of the audit committee to be suitably qualified and at least one member to have
3.1.4 ✓ 20-25, 209
expert knowledge of finance and accounting
3.1.5 Head of internal audit to have direct access to audit committee ✓ 209
The committee to meet at least 4 times a year and the number of meetings and attendance by
3.1.6 ✓ 209, 218
individuals members disclosed in the annual report
3.2 OBJECTIVE AND ACTIVITIES
Statement of Audit Committees review to ensure that internal controls are well conceived 199, 209-
3.2.1 ✓
properly administered and satisfactorily monitored 210
Statement to indicate audit committees role in ensuring compliance with Laws, Regulations and 199, 209-
3.2.2 ✓
timely settlements of statutory dues 210
199, 209-
3.2.3 Statement of Audit Committee involvement in the review of external audit function ✓
210
v  Ensure effective coordination of external audit function
v  Ensure independence of external auditors
v  To review the external auditors findings in order to be satisfied that appropriate action is
199, 209-
being taken ✓
v  Review and approve any non audit work assigned to the external auditor and ensure that 210
such work does not compromise the independence of external auditors
v  Recommend external auditor for appointment/reappointment
Statement on Audit committee involvement in selection of appropriate accounting policies that 199, 209-
3.2.4 ✓
are in line with applicable accounting standards and annual review 210

Bank Asia Limited

196
 Compliance Ref Page
SL Items
Status No
Statement on Audit committee involvement in the review and recommend to the board of 199, 209-
3.2.5 ✓
directors, annual and interim financial releases 210
199, 209-
3.2.6 Reliability of the management information used for such computation ✓
210
4 INTERNAL CONTROL & RISK MANAGEMENT
4.1 Statement of director’s responsibility to establish appropriate system of internal control ✓ 200
Narrative description of key features of the internal control system and the manner in which the
4.2 ✓ 210-211
system is monitored by the Board, Audit Committee or Senior Management
4.3 Statement that the directors have reviewed the adequacy of the system of internal controls ✓ 200
113-117,
4.4 Disclosure of the identification of risk the company is exposed to both internally and externally ✓
210-211
113-117,
4.5 Disclosure of the strategies adopted to manage and mitigate the risks ✓
210-211
5 ETHICS AND COMPLIANCE
Disclosure of statement of ethics and values, covering basic principles such as integrity, conflict
5.1 ✓ 11-12, 211
of interest, compliance with laws and regulation etc.
Dissemination/communication of the statement of ethics & business practices to all directors
5.2 ✓ 11-12, 211
and employees and their acknowledgement of the same.
Board’s statement on its commitment to establishing high level of ethics and compliance within
5.3 ✓ 11-12, 211
the organization
Establishing effective anti-fraud programs and controls, including effective protection of whistle 11-12, 211,
5.4 ✓
blowers, establishing a hot line reporting of irregularities etc. 161
6 REMUNERATION COMMITTEE
6.1 Disclosure of the charter (role and responsibilities) of the committee ✓ 212
Disclosure of the composition of the committee (majority of the committee should be non-
6.2 ✓ 212
executive directors, but should also include some executive directors)
Disclosure of key policies with regard to remuneration of directors, senior management and 140-144,
6.3 ✓
employees 212, 178
6.4 Disclosure of number of meetings and work performed ✓ 212
6.5 Disclosure of remuneration of directors, chairman, chief executive and senior executives ✓ 212
7 HUMAN CAPITAL
Disclosure of general description of the policies and practices codified and adopted by
the company with respect to Human Resource Development and Management, including 87-89, 178,
7.1 ✓
succession planning, merit based recruitment, performance appraisal system, promotion and 212-216
reward and motivation, training and development, grievance management and counseling
7.2 Organizational Chart ✓ 17, 216
8 COMMUNICATION TO SHAREHOLDERS AND STAKEHOLDERS
Disclosure of the company’s policy/strategy to facilitate effective communication with 162-164,
8.1 ✓
shareholders and other stakeholders 216
Disclosure of company’s policy on ensuring participation of shareholders in the Annual General
8.2 ✓ 4, 216
Meeting and providing reasonable opportunity for the shareholder participation in the AGM
9 ENVIRONMENTAL AND SOCIAL OBLIGATIONS
146-155,
Disclosure of general description of the company’s policies and practices relating to social and 166-168,
9.1 ✓
environmental responsibility of the entity 185-187,
217
146-155,
Disclosure of specific activities undertaken by the entity in pursuance of these policies and 166-168,
9.2 ✓
practices 185-187,
217

Annual Integrated Report 2017

197
 Report on the Activities
of the Audit Committee

Bank Asia Limited

198
The Audit Committee of the Board of Directors of Bank Asia Limited was constituted strengthened including development of
in the 44th meeting of the Board held on January 18, 2003 in compliance with the human resources towards creation
Bangladesh Bank directives. The Audit Committee was formed with the objectives to of a compliance culture in the Bank.
establish a platform for a compliant and secured banking structure in the Bank. The
present Audit Committee consists of the following members: The efforts have been made to keep
assets of the Bank safe along with
Status with the Status with the Audit liabilities and commitments are made
Names transparent.
Board Committee
Mr. Mashiur Rahman Independent Director Chairman
The Financial Statements of the Bank
Mr. Mohd. Safwan Choudhury Vice Chairman Member have been prepared in accordance
Mr. Dilwar H Choudhury Independent Director Member with Bangladesh Financial Reporting
The Company Secretary acts as Secretary of the Committee Standards (BFRS) and contained full
disclosure.

In the year 2017, 09 (nine) meetings of the Inspectors, External Auditors and the Reporting
Audit Committee were held in which, the Internal Auditors in the reports.
following issues, amongst others, were The committee in the meetings has taken
reviewed and discussed: vii. Management Report on Accounts of the particular notes of lapses detected by the
Bank for the year ended on 31.12.2016. Internal Audit Team and the actions taken
i. External Audit Report of the Bank and by the management towards correction,
the recommendations made there viii. Implementation of Core Risk which has helped improving the recovery
under. Management Guidelines including of classified loans and initiating measures
Internal Control and Compliance Risk for lowering the quantum of NPLs through
ii. Bangladesh Bank comprehensive along with compliance thereof. on-site and off-site monitoring. The
inspection report and the committee as well assisted instituting
recommendations made there under. ix. The review of status of recovery of recovery mechanisms, constituting a
classified loans and providing with robust credit administration and, carefully
iii. Audit and Inspection reports on the the necessary guidelines to the reviewed the internal control system and
branches, divisions and departments management to reduce the NPLs. procedures including IT operation to
of the Corporate Office prepared by secure the Bank from foreseeable shocks.
the Internal Control and Compliance The Audit Committee has further The process of continuous monitoring
Division (ICCD) of the Bank. satisfied that: was established for avoidance of errors
and omissions and, repetition of lapses as
iv. Actions taken by the management The rules and regulations of the are detected by the internal and external
in regard to deficiencies raised in the Bangladesh Bank and all other auditors.
Bangladesh Bank Inspection report and regulatory authorities and Bank’s own
by the Internal Audit and Inspection policy guidelines approved by the The minutes of the Audit Committee
Team of the Bank. Board of Directors are duly complied Meetings observations and the
with. recommendations were circulated among
v. The corrective measures taken by the the members of the committee and to
management in regard to the lapses Internal control and security measures the Board of Directors of the Bank for
pointed out on the internal control and have been adequately undertaken information.
other issues as are raised by internal by the Bank towards facilitating
and external auditors and inspectors of Information Technology (IT) based
the regulatory authority. banking including generation of proper
Management Information System (MIS). Mashiur Rahman
vi. The compliance status of the audit Chairman
objections and the recommendations The system of internal control and Audit Committee of the Board
made by the Bangladesh Bank the business processes have been

Annual Integrated Report 2017

199
 Statements of Directors’ Statement of Directors’ on
responsibility to establish Adequacy of the System of
appropriate System of Internal Control
Internal Control
Strengthening and streamlining internal control system has The Board of Directors follows some definite rules and regulations
significant importance and governance to attain short-term as stated in the ‘Banking Companies Act 1991 (amended up to
business objectives and long-term sustainability. During the 2018)’. Therefore, the directors tried their level best to maintain
year, market liquidity was tighter, interest rate was lower, private sound corporate governance and performed their responsibilities.
credit demand was high, and the challenge of ensuring effective Broad business strategy, significant policies for internal control
internal audit and control system were even greater. system and risk management have been taken properly and risk
based internal audit has been accomplished as per ‘section 15
The board is cautious on the internal control system of the bank
Kha & 15 Ga of the Banking Companies Act 1991 (amended up to
in order to attain and maintain satisfactory qualitative standard
2018)’ for ensuring that the bank is appropriately and effectively
of its loan/investment portfolio. The board review quarterly the
managed and controlled.
reports submitted by its audit committee regarding compliance
of recommendations made in internal and external audit The Board has supervised the policies and various parts of
reports and the Bangladesh Bank inspection reports. businesses to construct an effective internal control system
which is essential for sustainable growth maintaining efficient
The Directors acknowledge their overall responsibility
conduct of business. They have also reviewed the adequacy and
for the Bank’s systems of internal control for establishing
completeness of accounting records, well preparation of financial
efficiency, effectiveness, reliability, timeliness, completeness
information, and efficient management of risk, strengthening
and compliance with applicable laws and regulations. They
bank’s assets and overall internal control process.
annually review the qualification, expertise and resources, and
independence of the external auditors and the effectiveness of By forming the audit committee, the Board of Directors monitors
audit process and recommendation on re-appointment. the functional and effectiveness of internal control system. All the
conditions depicted in the Banking Companies Act 1991 (amended
Directors confirm that the Board, through its committees, has
up to 2018), guideline issued by Bangladesh Bank and corporate
reviewed the effectiveness of the bank’s systems of internal
governance guidelines issued by Bangladesh Securities and
control for the year ended 31 December, 2017. This process
Exchange Commission have been properly maintained at the time
involved a confirmation that a system of internal control in
of preparing the Audit Committee. The principal activity of the
accordance with best financial reporting practice was in place
Audit committee was to review the internal control system as well
throughout the financial year and up to the date of signing
as managing the core risk of the bank. The process for monitoring
of these financial statements. It also involved an assessment
compliances with laws and regulations and codes of business
of the ongoing process for the identification, evaluation and
ethics have been properly reviewed by the committee.
management of individual risks and of the role of the various
committees and bank’s risk management functions and the The Audit Committee has observed the arrangements for
extent to which various significant challenges are understood increasing the internal control features to the prevalent
and are being addressed. management information system (MIS). They have also
reviewed the corrective initiatives undertaken by management
corresponding to fraud-forgery and deficiencies in internal
On Behalf of the Board of Directors, control identified. All the compliance reports have been properly
presented before the board of directors and regulators in a timely
manner and all other regulatory functions about internal control
system of the bank have been executed explicitly.

A Rouf Chowdhury On Behalf of the Board of Directors,

Chairman

A Rouf Chowdhury
Chairman

Bank Asia Limited

200
Chief Executive Officer and Chief Financial Officer’s
Statement of Responsibilities for the year 2017
(In line with the Bangladesh Securities and Exchange Commission (SEC) notification no.SEC/CMRRCD/2006-158/134/Admin/44 dated August 07, 2012)

The preparation and presentation of financial statements accurately and appropriately is the responsibility of the management and
accordingly we state that:

1. We have reviewed the balance sheet and profit and loss account (stand alone and consolidated), and all the schedules & notes
to the accounts, and the Cash Flow statements for the year ended December 31, 2017 that are prepared under the historical cost
convention. However, the director’s report and other reports include updated information that were available till the publication of
the Annual Integrated Report 2017. The financial statements were prepared in accordance with the Bangladesh Financial Reporting
Standards (BFRS) and comply with Banking Companies Act 1991 (amended up to 2018), Income Tax Ordinance 1984, the rules and
regulations issued by Bangladesh Bank, the Companies Act 1994, the Securities and Exchange Rules 1987 and other applicable laws
and regulations.
2. We have also reviewed director’s report and other reports for accuracy and appropriateness. Best of our knowledge and information,
these reports do not contain any untrue statement of a material fact.
3. Based on our knowledge and information, the financial statements, and other financial information included in this report, present
in all material respects a true and fair view of Bank’s affairs, and the financial conditions, results of operations and cash flows of the
Bank as of, and for, the year under report, and are in compliance with the existing accounting standards and/or applicable laws and
regulations.
4. To the best of our knowledge and belief, no transactions enter into by the Bank during the year are fraudulent, illegal or violating
business ethics and codes of conduct that ensure by external auditors and the audit committee, which estimates a high degree of
judgments.
5. We along with those charge with governance, are responsible for establishing and maintaining disclosure controls and procedures
and internal controls over financial reporting for the Bank, and we have:
a) Designed such disclosure controls and procedures to ensure that material information relating to the Bank, including its
consolidated subsidiaries, is known to us by others within those entities, particularly during the period in which this report is
being prepared.
b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed
under our supervision, to provide reasonable assurance regarding the reliability of financial reporting.
c) Evaluated the effectiveness of Company’s disclosure, controls and procedures.
d) Disclosed in this report any change in the company’s internal control over financial reporting that occurred during the year under
report that has materially affected, or is reasonably likely to materially affect, the Bank’s internal control over financial reporting.
6. We have disclosed based on our recent evaluation, wherever applicable, to the Bank’s internal and external auditors, inspection team
of Bangladesh Bank and other regulatory bodies and also to the audit committee of the board that:
a) There have no deficiencies in the design and operation of internal controls, that could adversely affect the Bank’s ability to
record, process, summarize and report financial data, and there have been to material weakness in internal control over financial
reporting including any corrective action with regard to deficiencies.
b) There were no significant changes in internal controls during the year covered by the report.
c) All significant changes in accounting policies during the year, if any, and that the same have been disclosed in notes to the
financial statements.
d) There were no instances of fraud of which we were aware, that involves management or the employees to have a significant role
in Bank’s internal control system.
7. We affirm that we have not denied any person from access to the audit committee of the bank (in respect of matters involving alleged
misconduct) and we have provided protection to whistle blowers from unfair termination and other unfair or prejudicial employment
practices.
8. We further declare that all Board Members and senior managerial personnel have affirmed compliance with the code of conduct for
the current year.

Mohammad Ibrahim Khalil, FCA Md. Arfan Ali

Chief Financial Officer President and Managing Director

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Governance
PREFACE The Board conducts an annual review of its performance and that of its Committees.
Bank Asia is fully committed to integrity An orientation program is in place for all new directors.
and fair dealing in all its activities, All directors, executives/officers and employees of Bank Asia are required to
and upholds the highest standards of acknowledge their adherence annually to Bank’s guidelines for business conduct.
corporate governance. Bank Asia’s main
objective of corporate governance practice
Mr. Mohammad Ibrahim
is to safeguard the stakeholders’ interest Khalil FCA, CFO of Bank Asia
in conformity with applicable rules and Limited received SAFA Best
regulations on a sustainable basis. Presented Annual Report
Awards 2016
Sound Corporate Governance (2nd position) in Corporate
The framework described below provides Governance Disclosures
category from Mr. Shankar
an overview of the corporate governance Prasad Adhikari, Finance
structures, principles, policies and Secretary of Nepal.
practices of the Board of Directors of Bank
Asia Limited. The framework enables Bank
Asia to meet governance expectations
of the Bangladesh Bank, Bangladesh
Securities and Exchange Commission
(BSEC), Dhaka Stock Exchange (DSE) and The following section describes the Board’s primary corporate governance policies and
Chittagong Stock Exchange (CSE). To practices with specific reference to Principles of Code. These policies and practices are
serve the interests of shareholders and constantly reviewed as corporate governance environment structure continuously evolves.
other stakeholders, Bank Asia’s corporate
governance system is subject to ongoing 1. BOARD OF DIRECTORS, CHAIRMAN AND CEO
review, assessment and improvement.
The Board of Directors proactively Principle: Board’s overall responsibilities
adopts governance policies and practices “The board has overall responsibility for the bank, including approving and overseeing
designed to align the interests of the management’s implementation of the bank’s strategic objectives, governance
Board and management with those of framework and corporate culture.”
shareholders and other stakeholders Policy on Appointment of Directors
and to promote the highest standards of Bank Asia complied with relevant guidelines of Bangladesh Bank circulars, rules and
ethical behavior and risk management regulations of the Companies Act 1994, Bank Companies Act 1991 (amended up to 2018),
at every level of the organization. Bank
Asia’s Shares are listed on the Dhaka Stock
Exchange (DSE) and Chittagong Stock
Exchange (CSE).
The Board exercises its authority in
accordance with the Bank Asia’s Code of Compliance to best practice
President and Managing Vision
Strategic Plan
Management ensures
Conduct, its By-laws and the Bank policies, Director ensures compliance Board defines vision, strategy and an
to annual objectives mission, values and goals. Annual working plan
as well as other applicable laws and through best practices.
regulations, including those imposed by
the regulators.
Practices we admire
Chairman leads the Board of Bank Asia
Limited.
Representation of women on the Board Performance Management Metrics & Reporting
Management reports to Board
Board ensures management
is encouraging. performance evaluation on performance & Health
The Bank is being run in line with
Corporate Governance Policy of the
regulators.
Shareholders vote for individual
directors.
All Board’s Committees meet Corporate
independent guidelines in respect of Accountability
Board ensures Policies,
Governance
composition. Processes & Systems to drive
performance

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Bangladesh Securities and Exchange policies approved by the Board; Other responsibilities:
Commission (BSEC) Notifications and Approve and monitor the bank’s
Memorandum & Articles of Association overseeing, through the Audit ethical values and their effective
of the Bank. Committee, the quality and integrity compliance.
of the accounting and financial
While appointing new Directors Bank reporting systems, disclosure controls Oversee the establishment of
Asia emphasizes the mix of knowledge, and procedures and internal controls appropriate risk management
skills, experience and perception. The and, through the Risk Management systems including defining the
Directors are elected by the shareholders Committee, the quality of the risk bank’s risk appetite and establishing
in AGM and all appointment of the Board management processes and systems; appropriate financial policies such as
is made subject to approval of Bangladesh target capital and liquidity ratios.
Bank. In case of nomination, removal, reviewing management performance
causal vacancy and alternate Directors, and ensuring that management The board ensures that transactions
Bank Asia follows all relevant rules and formulates policies and processes with related parties (including internal
regulations. The Bank’s non-executive to promote fair practice and high group transactions) are reviewed
Directors are independent of management standards of business conduct by to assess risk and are subject to
and free from day to day business of the staff; appropriate restrictions (e.g. by
bank. Directors are accountable to the requiring that such transactions be
providing a balanced and conducted on arm’s length terms) and
shareholders for the Bank’s performance understandable assessment of the
and governance. The Bank Companies that corporate or business resources
Bank’s performance, position and of the bank are not misappropriated
Act provides that there will be maximum prospects including interim and other
20 (twenty) Directors on the Board or misapplied.
price sensitive public reports as well
including Managing Director and 3 (three) as reports to regulators; In discharging these responsibilities, the
Independent Directors. The corporate Board takes into account the legitimate
governance notification of BSEC provides considering sustainability issue i.e. interests of depositors, shareholders and
that the Board will consist minimum environmental and social factors, as other relevant stakeholders. It also ensures
5 (five) and maximum 20 (twenty) part of strategy formulation. that the bank maintains an effective
directors including minimum 1/5th of relationship with its regulators.
Selection and Nomination process
Independent Directors. For appointment
for Directors Delegation by the Board
of an Independent Director, the approval
Bank Asia has put in place a formal and The Board delegates authority and powers
of BSEC is obtained to comply the
transparent process for the appointment to Board Committees to oversee specific
requirement.
and re-appointment of Directors of responsibilities without abdicating its
Roles and Responsibilities of Board the Board. Bank Asia recognizes the responsibilities. These Committees
of Directors importance of having an appropriate report on a periodical basis to the Board
The Board is elected by the shareholders balance of industry knowledge, skills, and enable the Board to carry out its
to supervise the management of the background, experience, professional stewardship and fiduciary responsibilities
business and affairs of the Bank. The prime qualifications, gender in building an in an efficient manner.
stewardship responsibility of the Board effective and cohesive Board. The directors
is to ensure the viability of the Bank and are selected by the shareholders in the Meeting of the Board and Board
to ensure that it is managed in the best Annual General meeting. The Board fills Committee
interests of the shareholders as a whole casual vacancy, if any in accordance with The Board met 21 (twenty one) times
while taking into account the interests of condition mentioned in related laws and during the financial year. The Chairman
other stakeholders. The responsibilities of regulations. briefed the Board on the issues to be
the Board include the following: discussed during the Board meetings.
Appointment of Chief Executive The documents pertaining to decisions are
reviewing and approving overall Officer (CEO) circulated for the Board’s review before the
business strategy as well as In order to strengthen the financial base member’s meeting.
organization structure, as developed of the bank and obtain confidence of
and recommended by management; the depositors, Board of directors is Continuous Development Program
responsible to appoint an honest, efficient, Bank Asia believes that regular training
ensuring that decisions and experienced and suitable CEO or Managing and development are essential to equip
investments are consistent with long- Director. all directors with the appropriate skills and
term strategic goals; knowledge to perform their roles on the
ensuring that the Bank operates in Board and Board Committees effectively.
such a way as to preserve its financial On an annual basis, the Board assesses
integrity and in accordance with the skills that the Board collectively needs

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Governance
in order to discharge its responsibilities marketing and business administration. Principle: Board own structure
effectively and identifies steps to improve By that, it is ensured that they have the and practice
effectiveness. ability to interpret the decisions of bank’s “The board should define appropriate
management in a prudent manner. governance structures and practices
Appraisal of the Boards Performance for its own work, and put in place the
Bank Asia Limited has not set any option Code of Conduct for the means for such practices to be followed
for annual appraisal of the board’s Board of Directors and periodically reviewed for ongoing
performance. However, evaluation of the The Board of Directors follows a code of effectiveness.”
Board is performed at the AGM by the conduct which was adopted to provide
shareholders. guidance to directors to perform their duty Board Committee
in an honest, responsible and business- To increase efficiency and allow deeper
Non-Executive Directors like manner and within the scope of focus in specific areas, Board established
The Managing Director is the only their authority, has said for in the laws three specialized Board committees i.e.
Executive Director in the Board of Directors of country as well as memorandum and Audit committee, Executive committee
of the Bank. All other Directors including articles of association of the Bank. and Risk Management committee. The
the Chairman are Non –Executive committees are created and mandated by
Directors. The code of conduct states that: the Board. Each committee has specified
I. The members act honestly in good roles and responsibilities that set out in
Principle: Board Qualification and faith and in the best interest of the
Composition line with Bangladesh Bank, Bangladesh
stakeholders. Securities and Exchange Commission
“The board members should be and
remain qualified, individually and II. The members do not make improper (BSEC) and other regulatory guidelines.
collectively, for their positions. They use of information required as director. Executive Committee
should understand their oversight and The Executive Committee (EC) of the
III. The members do not take improper
corporate governance role and be able to board of Bank Asia was first constituted
advantage of the position as a director.
exercise sound, objective judgment about in January 2010 to ensure efficient,
the affairs of the bank.” IV. Confidential information acquired by competent, compliant and secured
the members in the course of exercise of structure for approval of credit proposals
Board Size
directorial duties remain the property of and business decisions. The number of
The Board of Bank Asia currently
the Bank. members in executive committee is 5
comprises of 12 (twelve) Directors
including the ex-officio Managing Director. V. Members make every effort to attend (five) nominated by the Board of Directors.
The Chairman and 10 (ten) other Directors all board and committee meeting during The EC time to time reviews policies and
are Non-Executive Directors from which their tenure. guidelines issued by Bangladesh Bank
4 (four) are independent directors regarding credit and other operations
and the CEO (Managing Director) is an VI. All other codes of conduct set by the that are customized and adopted by the
Executive Director. All the Directors except Bangladesh Bank, Bangladesh Securities management after approval of the Board
independent directors and the CEO and Exchange Commission and other of Directors. EC approves credit proposals
were elected by the shareholders of the regulatory bodies are followed strictly. as per approved policy of the Board.
company and the CEO is appointed by the The Board of Directors of the Bank Audit Committee
Board of Directors with the approval of the established high level of ethics and The Audit Committee of the Board of
Bangladesh Bank. Independent directors compliance within the organization and Bank Asia was first constituted in January
are appointed by the Board and approved they are committed to maintain it in Board 2003 with the objectives of generating
by the shareholders in the AGM. All the level and management level. a platform for a compliant and secured
Directors are highly-qualified, experienced banking. As per the BSEC notification no
professionals or successful businessmen Update market information SEC/CMRRC/2006-128/134/admin/44
in their own right with long experience to Directors dated 7 august 2012 audit committee
with the banking industry and they also Each and every Directors are expected to must consists of at least 3 (three) members
hold very responsible positions in public make important contributions based on with 1(one) Independent director. All the
life. The details qualifications of Board of industry knowledge, understanding of the members of Audit Committee should be
Directors are incorporated in Directors’ Business model of the Bank and the key selected from directors and the chairman
profile. challenges faced by the Bank as a whole. must be an independent director.
The Board is always kept updated on any Currently, 3 (three) members are in the
Knowledge and expertise in Finance development and changes in the business
and Accounting Audit Committee.
environment, risk and industry outlook.
Bank Asia’s Board of Directors comprises
of members who have wide knowledge
and experience in the field of finance,
accounting, economics, management,

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Corporate
Governance
Annual General Meeting

Shareholders External Auditors

Elect Engages

Regulators
BOARD OF
DIRECTORS

Executive Committee Risk Management Committee Audit Committee

Appoints

President & Managing

Director

Senior Management Credit Committee Asset Liability SRP Committee

Team(SMT) Committee

Risk Management Committee policies and decisions of the Board and emphasize that the policies and decisions are for the
To minimize risk while implementing the best interest of the whole bank. Bank Asia has 4 (four) independent directors in the Board.
policies and business plan of the Bank, They are: Three renowned retired bankers Mr. Mashiur Rahman, Mr. M Shahjahan Bhuiyan,
the Board has formed a Risk Management Mr. Dilwar H Choudhury and Mr. Md. Nazrul Huda, a retired central banker. This is a matter
Committee as per the guidelines of of great sorrow that, Mr. A M Nurul Islam, a renowned bureaucrat, one of the independent
Bangladesh Bank. The Committee directors and vice chairman of the Bank was passed away on 18.10.2017. The Independent
supervises whether the risks arise from Directors are also member of the sub-committees of the Board. Two of them are the
credit, foreign exchange, internal control members of the Executive Committee, two are the members of the Audit Committee,
and compliance, money laundering, and one is the member of the Risk Management Committee.
information technology, operation,
interest rate, liquidity and other sources Composition of the Board of
are identified, measured and adequate Directors – Non Executive Directors and Independent Directors
systems are in place to minimize such All the directors of the Board are non-executive directors and more than one- fifth are
risks. Currently 4 (four) members are in the Independent. Currently, there are four independent directors appointed by the Board and
Risk Management Committee. They set approved by the BSEC and the shareholders in the AGM.
risk appetite; formulate risk identification Independence of Independent Director
& control policy, recommend changes Independent Directors do not have any material or pecuniary relationship with the Bank apart
to the risk management framework. from receiving director’s remuneration. Bank Asia also follows existing rules and regulation while
They also monitor the internal capital appointing Independent Director which ensure the independence of Independent Director.
adequacy assessment process along with
the effectiveness of the risk management Retirement and Re - election of Directors
framework, policies and standards. The According to clause 128, and 129 of the Articles of Association of the Bank, 4 (four) directors
Risk Management Committee assists retired before the 18th Annual General Meeting (AGM) held on July 03, 2017 and one of
the Board in relation to the oversight of the retiring directors was eligible for re-election as director and 2 (two) new directors were
risk including the risk appetite and risk elected as directors at the AGM.
management strategy.
Independent Director
Participation of independent opinion in
the Board is considered as an important
element of good governance. Independent
directors exert an independent view on the

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 Corporate
Governance
SI. Name of Directors Mode of Change Position of Chairman and the Chief
No. Executive Officer
The functional responsibilities of the
1. Mr. Rumee A Hossain Retired
Chairman of the Board and of the
2. Ms. Farhana Haq Chowdhury Retired President and Managing Director are kept
3. Mr. Mir Shahjahan Retired separate and independent of each other.
4. Mr. M Shahjahan Bhuiyan Retired and Re-elected The Chairman of the Bank is elected by
the directors of the Bank and the CEO is
5. Major General Mohammad Matiur Rahman (retd.) Elected being appointed by the Board of Directors
6. Ms. Romana Rouf Chowdhury Elected subject to receiving permission from
Bangladesh Bank.
In addition, some other changes in directorship during the year were as follows: Roles and Responsibilities of the
Chairman:
SI. No. Name of Directors Date of Change Remarks The Chairman of the Board is elected by
1. Mr. A M Nurul Islam 18.10.2017 He passed away on 18.10.2017. the Bord of Directors. The responsibilities
of the Chairman are defined in the BRPD
Number of Board meeting held in 2017 Circular No. 11 dated 27 October, 2013.
During 2017, a total of 21 (Twenty One) Board meeting were held. The number of meetings The Chairman’s primary responsibility is
of the Board and committees held during the accounting year and the attendance of the to lead the Board, to ensure a common
Directors at those meeting are disclosed on page no. 218 purpose and effectiveness as a group
to uphold and promote high standards
Delegation of Authority of integrity, probity and corporate
The Board has delegated to the President and Managing Director and, through him, to other governance. The Chairman has the link
senior executives, the responsibility for the day-to-day management of the bank’s business between the Board and the Bank. The
and implementation of the bank’s strategies and policies. The President and Managing major role and responsibilities of the
Director along with other senior executives operate in accordance with a comprehensive set Chairman are:
of management delegations under the Bank’s Delegation of Authorities framework
a. The Chairman of the Board does
Directors Report to Shareholders not participate in or interfere into the
The Directors’ Report of the Bank includes all statement regarding section 1.5 of Bangladesh administrative or operational affairs of the
Securities and Exchange Commission notification no. SEC/CMRRCD/2006-158/134/Admin/44 bank since he does not personally possess
dated 07 August 2012 in directors’ report prepared under section 184 of the Companies Act, the jurisdiction to apply policymaking or
1994 (Act No. XVIII of 1994). executive authority.
Independence of Non-Executive Directors b. Sometimes the Chairman conducts
All the members of the Board of Directors, except the Managing Director, are non –executive on-site inspection of bank-branch or
directors and they are independent in expressing their views and opinions. The directors financing activities under the purview of
are also independent from management and other relationships of the Bank that could the oversight responsibilities of the Board.
materially affect the activities of the Bank. They also adhere to the corporate governance He has the right to call for any information
practices and guidelines. relating to bank’s operation for investigation
into any such affairs and thereby submit
Organization and Assessment of the Board: such information or investigation report to
Board’s Performance the meeting of the Board or to the executive
The Board of Directors always makes assessment to determine whether the Board and Board committee and, if considered necessary,
committees are performing effectively and identifies steps for improvement. The attendance with the approval of the Board, he may
of the Directors are registered for every Board Meeting. In Every Board meeting each Director adopt pragmatic initiatives with reference
participated actively, giving honest feedback on issues such as Board composition, succession to the set rules through the CEO. Besides,
planning and the quality of information provided to the Board. any complaint raised against the CEO is
required to be apprised to Bangladesh
Chairman of the Board Bank through the Board along with the
The Chairman of the Board of Director is responsible for leading the Board and overseeing statement of the CEO.
the entire functioning of the Bank. The success of a Board meeting is dependent almost
entirely on the art of conduct of the same by its chairman. Mr. A Rouf Chowdhury is the c. For the business interest of the bank,
current Chairman of the Board. Through his dynamic leadership, he is leading the Board the Chairman may be offered an office
towards the success of the Bank. room, a personal secretary/assistant, an
office telephone, a mobile phone and a car
for using within the country.

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Principle: Senior Management The CEO ensures compliance of the Mechanism to provide advice
“Under the direction and oversight of the Bank Company Act, 1991(amended to the Board
board, senior management should carry up to 2018) and other relevant laws Bank Asia maintains transparent and close
out and manage the bank’s activities in and regulations in performing routine communication with its shareholders.
a manner consistent with the business functions of the bank. With this view Bank publish annual &
strategy, risk appetite, remuneration and semiannual reports, publish quarterly
other policies approved by the board.” At the time of presenting any financials and price sensitive information
memorandum by the management (PSI) in newspapers for shareholders,
Senior management consists of a core in the Board Meeting or Board investors, capital market experts, and
group of individuals responsible and Committee Meeting, the CEO points other equity participants in a complete,
accountable to the Board for the sound out if there is any deviation from the fair, accurate timely and understandable
and prudent day-to-day management Bank Company Act, 1991 (amended manner within the framework of generally
of the bank. The organization and up to 2018) and other relevant laws accepted accounting principles and
procedures and decision making of and regulations. legislation provisions. Bank’s shareholders
senior management are clear and can also use their query rights or can
transparent and designed to promote The CEO remains accountable to
report to Bangladesh Bank if any provide any recommendations or direction
effective management of the bank. This to the Board of directors at the annual
includes clarity on the role, authority and violation of the Bank Company Act,
1991(amended up to 2018) or of other general meeting and the Board answers all
responsibility of the various positions questions of shareholders. Prior to AGM,
within senior management, including that laws/regulations is occurred.
the meeting date, venue and agenda are
of the CEO and Managing Director. The recruitment and promotion of all announced and also the annual report is
Consistent with the direction given by the staff of the bank except those in the submitted to the shareholders through
Board, senior management implement two tiers below him rest on the CEO. our bank’s website or through different
business strategies, risk management He acts in such cases in accordance channels. After getting feedback from
systems, risk culture, processes and with the approved service rules of the shareholders at AGM, the Board then
controls for managing the risks – both Bank. directs the management to implement the
financial and non-financial – to which the The authority relating to transfer of recommendations of the shareholders.
bank is exposed and concerning which and disciplinary measures against the If the Management requires making any
it is responsible for complying with laws staff, except those at two tiers below change in policy or practice, the Board
regulations and internal policies. the CEO, rests on him that he applies approves those changes; otherwise if this
in accordance with the approved authority of approval is beyond the power
Chief Executive Officer of the Board, this can be approved by
Bank’s CEO is Mr. Md. Arfan Ali. The detail service rules. Besides, under the
purview of the human resources the shareholders of Bank Asia Ltd at AGM
information of CEO is given in separate through voting.
part of director’s information under policy as approved by the Board, he
page no. 25 nominates officers for training etc. Chief Risk Officer
Annual Appraisal and evaluation of The name of Chief Risk Officer of the
Roles and Responsibilities of the CEO: Bank is Mr. Md. Sazzad Hossain. He is also
The President and Managing Director is CEO’s performance by the Board
While reappointing CEO, an evaluation Deputy Managing Director of the Bank.
responsible for implementation of Board The CRO is key responsible for overall risk
policies and overall Management of the report approved by the Board of Directors
submitted to Bangladesh Bank by the management of the Bank. The details
Bank. He discharges his duties under roles and responsibilities and overall
the delegation of financial, business and chairman of the Board. Besides, The Board
of Bank Asia Limited annually evaluate key risk management from CRO is separately
administrative authority given to him by disclosed in CRO’s report in page no 108
the Board. performance indicators (KPIs) of CEO i.e.
profitability, yearly budget achievement, Chief Financial Officer
The main responsibilities and authorities dividend ratio, return on equity, return on The name of Chief Financial Officer of the
of the Managing Director are as follows: assets, earnings per share, CAMELS ratings, Bank is Mohammad Ibrahim Khalil, FCA.
credit rating, classified loan ratio, risk Key responsibility and overall financial
The CEO undertakes his own management etc. The performance of the
responsibilities when the board health of the Bank is separately disclosed
CEO is also evaluated by the Board based in CFO’s report in page no. 246
vests the financial, business and on Bank’s operational results mainly in the
administrative authorities on achievement of operational budgets. Company Secretary
him. He remains accountable for The name of company secretary of the
achievement of financial and other Bank is Mr. Md. Kamrul Hasan FCS, CFA.
business targets by means of business
plan, efficient implementation and
prudent administrative and financial
management.

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Governance
The role of the company secretary is respecting the independent legal and in Bangladesh on 04 August 2010 bearing
defined. He attends all board meetings governance responsibilities that might certificate of incorporation no. C-86230/10
and ensures that board procedures and apply to its subsidiary boards. dated 04 August 2010 under the
applicable regulations are complied with. Companies Act 1994 having its registered
Under the direction of the Chairman, he In order to fulfill its responsibilities, the office at Hadi Mansion (7th Floor), 2,
ensures good information flows within the board of the parent company: Dilkusha Commercial Area, Dhaka 1000
Board and its committees and between established a group structure which commenced its business on the 17
senior management and non-executive (including the legal entity and April 2011. Total paid up capital of BASL is
Directors, as well as facilitates orientation business structure) and a governance Tk. 2,000.00 million. Currently, BASL has
of new Directors and professional framework with clearly defined roles following seven (07) directors:
development of Directors, as required. The and responsibilities, including those
at the parent company level and Mr. A Rouf Chowdhury, Chairman
appointment and removal of the company of the Board
secretary is considered to be a matter for those at the subsidiary level;
define an appropriate subsidiary Mr. Anisur Rahman Sinha, Director
the Board as a whole. Mr. Md. Nazrul Huda, Director
board and management structure to
Attendance of CEO, CFO, CS in Board contribute to the effective oversight Ms. Romana Rouf Chowdhury, Director
Meeting of businesses and subsidiaries, which Mr. Md. Arfan Ali, Director
The CEO, CS, CFO of the Bank attend the takes into account the different risks Mr. Md. Sazzad Hossain, Director
meetings of Board of Directors. It is also to which the group, its businesses and Mr. Dilwar H. Choudhury, Director
provided that they are not attending the its subsidiaries are exposed; Mr. Mohammad Ibrahim Khalil, FCA,
meeting which involve consideration of assess whether the group’s corporate Director
an agenda item relating to their personal governance framework includes The Board of Directors of BASL conducted
matters. In addition, they are not entitle adequate policies, processes their roles and responsibility in line with
for any remuneration for attending such and controls and addresses risks the Companies Act 1994, Bangladesh
meetings of the Board of Directors. across the business and legal entity Securities and Exchange Commission rules
structures; and regulation, Dhaka Stock Exchange
Principle: Governance of group ensure the group’s corporate
structure rules and regulation, parent Board
governance framework includes guidelines, and other regulatory act
“In a group structure, the board of appropriate processes and controls
the parent company has the overall or guidance.
to identify and address potential
responsibility for the group and for intergroup conflicts of interest, such BA Exchange Company (UK) Limited
ensuring the establishment and operation as those arising from intergroup The company was incorporated as a
of a clear governance framework transactions; private limited company under United
appropriate to the structure, business approve policies and clear strategies Kingdom Companies Act and registered
and risks of the group and its entities. The for establishing new structures and with Companies House of England and
board and senior management should legal entities, and ensure that they Wales vide registration no. 07314397 as a
know and understand the bank group’s are consistent with the policies and fully owned subsidiary company of Bank
organizational structure and the risks that interests of the group Asia Limited, BA Exchange Company (UK)
it poses.” complied all regulatory requirement Limited launched its operation in London
Parent company boards regarding monitor and review of on 16 May 2011. The paid up capital of
In group concept, Bank Asia limited is subsidiary companies; the company is £300,000. At the end of
parent company with having following have sufficient resources to monitor the year 2017, the company has following
three subsidiary companies compliance of subsidiaries with three (03) directors:
Bank Asia Securities Limited, all applicable legal, regulatory and Mr. A Rouf Chowdhury, Chairman
incorporated in Bangladesh – 99.99% governance requirements; and of the Board
owned maintain an effective relationship with Mr. Mohammad Arfan Ali
BA Exchange Company (UK) Limited, regulator and, through the subsidiary Mr. ABM Kamrul Huda Azad, CEO
incorporated in United Kingdom - board or direct contact, with the
The Board of Directors of BA Exchange
100% owned regulators of all subsidiaries.
Company (UK) Limited conducted their
BA Express USA Inc., incorporated in The details information of parent roles and responsibility in line with all
United States of America (USA) - 100% companies Board is given in separate part relevant regulatory act or guidance.
owned of this Annual Integrated Report.
BA Express USA Inc.
The board of the parent company is Bank Asia Securities Limited BA Express USA Inc. is fully owned
aware of the material risks and issues A majority owned (99.99%) subsidiary subsidiary company of Bank Asia
that might affect both the bank as a company of Bank Asia Limited was Limited incorporated in New York State
whole and its subsidiaries. It exercises incorporated as a private limited company Department of Financial Services (NYSDFS)
adequate oversight over subsidiaries while

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Corporate
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in USA. The company obtained license 3. AUDIT COMMITTEE Audit Committee Comprises
to receive money for transmission within of Non-Executive Director
USA and abroad and to transmit same, 3.1 Appointment and Composition All the members of the Audit Committee
pursuant to the provision of Article of Audit Committee are Non-Executive Directors. No executive
13-B of the USA Banking Law, subject Bank Asia’s Audit Committee consists of Bank Asia is eligible to become a
to all rules and regulations made by the of 3 (three) members. All of them are member of Audit Committee.
Superintendent of Financial Services non-executive directors from whom 2
of New York relating to such business, of them are independent directors and All members are suitably qualified and
effective November 22, 2013. The company the company secretary of the bank is expertise in Finance and Accounting
has started its commercial operation from the secretary of the Audit Committee. All member of the audit committee
June 01, 2014. The paid up capital of the Mr. Mashiur Rahman, the Chairman of are suitably qualified and all of them
company is USD 960,000. At the end of the audit committee is an Independent have expert knowledge of finance and
the year 2017, the company has following Director and from Business administration accounting. All memebers of Audit
three (03) directors: background and all the members are Committee are very competent and come
Mr. A Rouf Chowdhury, Chairman financially knowledgeable and have long from a variety of educational backgrounds
of the Board experience in banking industry. which brings a diversity and uniqueness in
Mr. Rumee A Hossain, Director the committee.
Chairman of the Audit
Mr. Md. Arfan Ali, Director Committee – Independent Director Access of Head of Audit
The Board of Directors of BA Express Mr. Mashiur Rahman, the Chairman of to the Audit Committee
USA Inc. conducted their roles and the Audit Committee is an Independent The name of Head of ICCD (Internal
responsibility in line with all relevant Non –Executive Director. He is a renowned Control and Compliance Division) of
regulatory act or guidance. banker and former Managing Director Bank Asia is Mr. Md. Aminul Islam Mintu,
of IFIC Bank with having 4 decades of FCCA. He has direct access to the audit
2. VISION, MISSION banking experience. More information committee and he can raise any concern
AND STRATEGY about him is available in the Director’s whenever required to audit committee.
Vision/ mission statements are approved Profile Page.
Review and Evaluation of Quarterly
by Board of Directors and are disclosed in Terms of Reference Performance Report
Annual Report. of Audit Committee The Audit Committee reviews and
The Board of Directors defined Bank’s Audit committee takes up the evaluates the quarterly performance
vision, mission, and strategic objectives responsibilities to supervise the including the financial reports and refer
and strictly adhere to it. Bank Asia strongly management and control of various risk the same to the Board.
believes in the vision and mission and factors coming up from banking operation.
Meeting of Audit Committee
try to accomplish it in every business The committee work to strengthen the
The Audit Committee conducted 9 (Nine)
context as possible. Bank’s vision, mission, internal control system and to act as
meetings during the year 2017. The
strategic objective depicted on page no. 08 a connecting force between internal
attendance status of the meeting is given
of this Annual Integrated Report. and external auditors in order to bring
in the report.
a disciplined banking operation. Audit
Business Objectives and areas committee reviews the financial reporting 3.2 Objectives and Activities
of Business Focus process, accounting policies & principles, of Audit Committee
The Board of Directors of Bank Asia always hiring of external auditors, significant
set business objectives as per market related party transaction, the system of Roles and Responsibilities
demand. They also set areas for focus in internal control and management, the of Audit Committee
consistent with market. Detail business audit process, compliance with laws and Management of Bank Asia is responsible
objectives and areas of business focus regulations, and its own codes of business for the preparation, presentation and
depicted on page no.09 of this Annual conduct. The audit committee also integrity of the financial statements and
Integrated Report. examines the status of implementation for maintaining appropriate accounting
of Bangladesh Bank guidelines, BSEC and financial reporting principles,
Description of strategies to achieve policies, internal controls and procedures
notification/gazette, Company Act 1994,
the company’s business objectives designed to ensure compliance with
DSE & CSE listing regulation and bank’s
Bank Asia always formulate strategies accounting standards and applicable laws
own policies and manuals.
and different action plan in the beginning and regulations. The external auditor is
of the year which are clearly aligned Bank Asia’s Audit Committee comprise responsible for planning and carrying
with banks mission, vision and business of two third of members who are out, in accordance with professional
objectives. Detail strategies to achieve Independent Non-Executive Director. standards, an audit of the annual financial
the bank’s business objectives depicted statements and an audit of internal control
on Page no.56 of this Annual Integrated over financial reporting. The external
Report. auditor also reviews the quarterly financial

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 Corporate
Governance
information. The Audit Committee’s roles is responsibilities to consider the major In these reviews, emphasis is focused
to review the adequacy and effectiveness findings for internal investigations and on areas of greater risk as identified by
of these activities and to assist the Board management’s response; risk analysis. The Directors confirm that
in its oversight of: Attend at the Annual General meeting the Board, through its Committees, has
of the Bank. reviewed the effectiveness of the Bank’s
Oversee the financial reporting process. systems of internal control for the year
Selection of appropriate accounting ended 31 December 2017. This process
policies and principles. 4. INTERNAL CONTROL AND involved a confirmation that a system
Review and recommended Annual RISK MANAGEMENT of internal control in accordance with
and Interim Financial Statements best financial reporting practice was in
Internal Controls
Monitor Internal Audit and place throughout the financial year and
To ensure good governance in the bank
Compliance process to ensure that up to the date of the signing of these
management it is essential to have specific
it is adequately resourced, including financial statements. It also involved
internal control. A strong internal control
approval of the Internal Audit and an assessment of the ongoing process
system can ensure the achievement of
Compliance Plan and review of for the identification, evaluation and
banks’ goals and objectives with long term
the Internal Audit and Compliance management of individual risks and of the
profitability. It also helps to comply with
Report. role of the various Committees and Bank’s
rules and regulation as well as policies and
Monitor Internal Control Risk risk management functions and the extent
to minimize the financial and reputational
Management process. to which various significant challenges are
losses.
Review all the related party understood and are being addressed.
transactions of the company. Review Boards responsibility to establish
regulatory compliances with all Internal Control function on Money
appropriate system of internal control
applicable laws including tax, labor, Laundering, fraud & corruption
The Directors acknowledge their overall
environment, etc. Money Laundering, fraud & corruption
responsibility for the Bank’s systems of
Review the audit plan and have become very important issues in
internal control for establishing efficiency,
methodology submitted by the recent years. These have a major impact
effectiveness, reliability, timeliness,
external auditor(s) to carry out the on our country‘s economy as a whole,
completeness and compliance with
audit. impeding the economic development.
applicable laws and regulations. Along
Ensure independence of External Bank Asia always been very effective in
with Board of Directors internal control
Auditors and review external auditor’s controlling these by establishing proper
is affected by the senior management,
findings on that point. systems.
audit committee and all level of
Meeting with the management or personnel. Bank Asia follows the Bank It is also true that, the system of internal
auditors for review of the quarterly Company Act,1991 (amended up to 2018) controls provides reasonable but not
financial statements before Section 15 (kha) & (ga) that gives the absolute assurance that the Bank will
submission to the board for approval responsibility to the Board of Directors not be adversely affected by any event
or adoption. for establishing policies for the bank that could be reasonably foreseen as it
Meeting with the external or company, for risk management, internal strives to achieve its business objectives.
statutory auditors for review of the controls and compliance for ensuring their However, the Board also notes that no
annual financial statements before implementation. system of internal controls can provide
submission to the board for approval/ absolute assurance in this regard, or
adoption. Key features of Internal Control
absolute assurance against the occurrence
Review Management Letter including 1. Work-planning and strategic
any fraud or other irregularities.
effectiveness of Internal Control management
and Compliance issued by statutory 2. Risk identification and management Risk Management
auditors and management response 3. Information and communication “Banks should have an effective
thereon. 4. Management Integrity independent risk management function,
Review the Management’s Discussion 5. Competent personnel under the direction of a chief risk
and Analysis (MD&A) before disclosing 6. Segregation duties officer (CRO), with sufficient stature,
in the Annual Report; 7. Records maintenance independence, resources and access to the
Oversee nomination, determination 8. Safeguards board.”
of audit fees based on scope and Bank Asia has an effective independent
magnitude, level of expertise risk management function, under the
Review of the adequacy of the system
deployed and time required for direction of a Chief Risk Officer (CRO), with
of internal controls by Director
effective audit and evaluate the sufficient stature, independence, resources
The above controls, which are embedded
performance of external auditors and access to the Board and Board risk
within the operations of the Board, are
Discharge committee’s fiduciary management committee.
reviewed by Bank Audit committee.

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Identification of Risk faced by Bank through all levels of the organization. The and regulatory requirements. The Board
Asia both internally and externally Board always encouraged management believes in conducting itself in ways that
The ability to manage risk well is a to ensure that everyone maintains a high will deliver maximum sustainable value to
core competency at Bank Asia, and is ethical standard within the Bank. all shareholders.
supported by our strong risk conduct and Board statement on commitment to Avoiding conflict of interest
culture, and an effective risk management establishing high level of ethics and In Financial Institution like Bank, there
approach. We define risk as the potential compliance within the organization exists high possibility of arising conflicts of
for loss or an undesirable outcome with The Board of Directors of the Bank has interest between Board of Directors and
respect to volatility of actual earnings always been committed to establishing a the management of the company. To avoid
in relation to expected earnings, capital high level of ethics and compliance among such unwanted situation Bank Asia has
adequacy or liquidity. Bank Asia manages all employees of the organization. Board of separated the responsibility/authority of
both internal and external risk by ensuring Directors always encouraged management these two interest groups of the bank. To
that business activities and transactions so that every employee maintains a high avoid conflict of interest and also to make
provide an appropriate balance of return ethical standard. accountable the bank has already taken
for the risks assumed and remain within the following measures:
our risk appetite. Whistle- blowing policy
Loan to the directors is restricted
The Bank has in place a whistle-blowing
Strategies adopted by Bank Asia to subject to fullfiling certain terms and
policy which encourages all staff and
manage and mitigate the risks conditions of regulatory guidelines.
members to raise genuine concerns or
As a Financial institution, Bank Asia’s major If there is any related party transaction,
suspicions about possible improprieties in
risk categories include credit, market, the management discloses the matter
accounting, auditing, financial reporting or
liquidity, insurance, operational, regulatory in the Annual Report and it is also
any other fraudulent activities. Procedures
compliance, strategic, reputation, legal approved by the general shareholders
for handling of feedback/complaints
and regulatory environment, competitive, in AGM.
received from customers and conduction
and systemic risks. In order to avoid Executive committee of the Board can
of independent investigations have been
excessive concentration of risks, Bank Asia approve loan to anyone up to a limited
established.
strives to diversify business lines, products portion.
and sector exposures. Establishment of effective anti-fraud Audit committee regularly reviews the
program and controls financial and other related statements
5. ETHICS AND COMPLIANCE The anti-fraud program helps bank and gives recommendation to the
Compliance Policy Establishment to support its commitment to protect management regarding any changes
“The bank’s Board of Directors is revenue, reputation and other assets. Bank in policy and also presents to the
responsible for overseeing the Asia established anti-fraud and Board for further evaluation.
management of the bank’s compliance anti-corruption program for the employee Board of directors’ approval is needed
risk. The board should establish a by conducting different trainings. for loan re-scheduling.
compliance function and approve the Accountability Related Party Transaction
bank’s policies and processes.” The Board provides shareholders with The Company has in place policies and
The establishment and maintenance quarterly and annual financial results. procedures governing related party
of ethical culture is very important for In presenting these statements, the transactions. The Board approves all
any organization. It is more important Board aims to provide shareholders related party transactions and ensures
for organization like banks where with a balanced and understandable that these transactions with the Company
maintaining and look after of public trust assessment of the Bank’s performance are undertaken on an arm’s length basis.
is of critical importance. To uphold the and position with a commentary at the The Audit Committee reviews all material
public confidence Bank always have to date of announcement of the competitive related party transactions and keeps the
practice ethical culture throughout the conditions within the industry in which Board informed of such transactions.
organization. it operates. The Management provides During the year, the Company had
all directors periodically with accounts collected deposits from its Directors
Statement of Ethics and and detailed reports on the Bank’s and their related parties. No preferential
Communication of statement of ethics financial performance and related treatment had been extended to the
and business practices to all directors matters prior to each Board meeting. Directors and their related parties for
and employees The directors may at any time seek these deposits. Statement of related party
Bank Asia’s senior management is further information from and discuss transaction are described in the
responsible for establishing a compliance with the Management on the Bank’s page no.323
policy that contains the basic principles operations and performance. Compliance
to be approved by the board and explains Department with direct reporting line to
the main processes by which compliance the Risk Management Committee is set
risks are to be identified and managed up to ensure compliance with legislative

Annual Integrated Report 2017

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Governance
6. REMUNERATION COMMITTEE management level no remuneration was given to any for any meeting regarding setting
Procedures for Developing remuneration.
Remuneration policies During 2017, the expenditures incurred related to directors were Tk. 2,992,000.00 for
As per Bangladesh Bank BRPD Circular Directors’ honorarium and Tk. 1,221,413.00 for Directors Travelling purpose.
no. 11 dated October 27, 2013, every Expenditure related to AGM
bank have to form three committee in In 2017, the Bank arranged one Annual General Meeting. For this purpose, total expenses
addition to the Board of Directors i.e. 1 were Tk. 2,348,470.00. This cost included rent of AGM venue, Entertainment for the
(one) executive committee, 1(one) audit Shareholders and Printing of notices, minutes and Annual Report.
committee and 1(one) risk management
committee. The mentioned circular also Remuneration of Chief
restricted to form any other permanent, Executive Officer
temporary or sub- committee except the Total remuneration to President and Managing Director for the year 2017 is Tk. 13,900,000
above mentioned three committees. As and in the year 2016 it was Tk. 15,689,899.
such Bank did not form any remuneration
Remuneration of top five executives
committee or other board committee on
permanent basis. Name Designation Gross Earnings
Management of Bank Asia forms adhoc Mr. Md. Zahirul Alam DMD 5,258,448.00
committee on need basis. That committee Mr. Mohammad Borhanuddin DMD 4,493,388.00
mainly recommends to Board about
mode of annual performance bonus Mr. Md. Sazzad Hossain DMD 3,801,660.00
disbursement, annual increment, etc. Mr. S.M. Iqbal Hossain SEVP 4,119,804.00

Key policies with regard to Mr. Mohammad Ziaul Hasan Molla SEVP 3,822,408.00
remuneration 7. HUMAN CAPITAL
At Management level Managing Director, Human Resource Management:
Head of Human Resources Division Human resources are used to describe both the people who work for the Bank and for
and Chief Financial Officer are charged managing resources related to employees. Each and every organization is composed
with governance of compensation of people. Acquiring their services, developing their skills, motivating them to high level
and remuneration. Usually they place of performances and ensuring that they continue to maintain their commitment to the
proposition to the Board which is then organization are essential to achieve organizational objectives. Getting and keeping the
reviewed and validated by the Board. After desirable people is the most important thing for any organization.
incorporating their recommendations the
compensation / remuneration decisions Human resource management involves both strategic and comprehensive approaches to
are approved by the Board. The main work managing people, as well as workplace culture and environment.
includes presenting recommendations
to the Board regarding remuneration, HRM Practices in Banking Industry is the potential industry where the growth of a country
compensation packages of Management, depends a lot. In Bangladesh banking industry is also very influential. This industry is very
incentive schemes and retirement big in Bangladesh and holds a lot of skilled employees. So Human Resource Management
benefits. They also assist the Board of (HRM) is very much applicable as well as practiced in the banks of Bangladesh.
Directors to ensure that all employees are
remunerated fairly and get performance- Bank Asia always believes any expenditure in training, development, health and
based compensation by ensuring effective support is an investment, not just an expense. Being a value driven organization, Bank
remuneration policy; procedures and Asia considers its employees as the most precious capital that play the vital role in
practices aligned with the Banks’ strategy materializing the mission, vision, goals and objectives of the bank.
and applied consistency for all employee
levels. Meeting regarding overseeing HR Accounting
the remuneration related policy by the Human resource accounting is the process of recognizing the value of a company’s
President and Managing Director, Senior investments to its employees and reporting the investments in the balance sheet which
Management, Head of Human Resources is currently accounted as a simple operational expense in the traditional accounting
Division and Chief Financial Officer was practices that deals with only physical asset creation. Unlike this traditional concept, in HR
held on need basis. accounting the investments made in human resources are viewed as a capital expenditure
because of the benefits that can be enjoyed for a long period of time and measured in
Disclosures of Remuneration
For attending the Board Meeting, Audit
Committee Meeting, Executive Committee
Meeting and Risk Management Committee
Meeting, the Directors receive an
honorarium of Tk. 8,000.00 each. But in

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Corporate
Governance
monetary terms. HR accounting provides valuable information to the investors who are interested to make long term investment in the
company.
Bank Asia reported the total value of Human Capital to be Tk 16,896 million in the year 2017 compared to Tk. 16,772 million in 2016 using
Present Value of Future Earning Model (Lev &Schwartz) which discounts total benefits payable to employees with the assumption of
minimum expected earnings from the year mentioned up to respective retirement.

Balance Sheet including human capital

Abridged for banking operation
Million Taka

31-Dec-17 31-Dec-16
Assets
Total Asset (Conventional) 288,997 253,196
Human Asset (Individuals' value) 16,896 16,772
Value of investments 15 12
Total Asset including Human Asset 305,908 269,980
Capital & liabilities
Total Liabilities (Conventional) 288,997 253,195
Human Capital 16,911 16,784
Total Capital & Liabilities including Human capital 305,908 269,980

According to the model, the total value of employees was regarded as Human Capital which saw a 1% growth in the value of human
capital in 2017 over 2016 due to net addition of 151 head counts of veteran and fresh recruitments meeting the necessity for expanding
the business as well as improvement of service quality and customer satisfaction experience. Bank Asia, therefore, proliferates training
expenditures on annual basis to aid in excelling employee performances.

Human Resources Development

Human Resource Development (HRD) is the framework for helping employees to develop their personal and organizational skills,
knowledge, and abilities. This approach is an outline for helping the employees to develop their personal as well as organizational
knowledge, skills and abilities by means of extensive improvement process covering employee training, performance management and
development, succession planning, coaching and counselling.
Succession planning
Succession planning is a process for identifying and developing new leaders, who can replace old leaders when they leave, retire or expire.
Bank Asia’s policy is to assess the leadership needs of the Bank in a way that ensures the selection of qualified leaders which matches its
mission and goals.
Future Leader Development Program (FLDP)
Bank Asia, being one of the most innovative banks in the country’s banking sector, believes that employees of Bank Asia has a lot of
potentials which needs to be aligned with entrepreneurial spirit and quality service in the financial sector.
To groom the employees as potential leader, the bank continued Future Leadership Development Program and completed 01(one) year of
the program in November 2017. Some 340 employees under 21 mentors have been immensely benefitted from this program.
Merit Based Hiring
Bank Asia always give high priorities on hiring young, energetic, proactive, enthusiastic, result oriented individuals who will be able to
uphold the values of the organization. Bank Asia not only give importance on developing a talent pool but also making plan for next key
successor position in the bank. Bank Asia provides equal employment opportunities to all applicants without any bias to race, religion,
gender, age, disability or any other criteria permissible by the statutory laws of the country. Recruitment and selection is based solely on
job-related criteria. The recruitment and selection process is consistently applied and promotes fairness, diversity and transparency.
Annual Integrated Report 2017
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Corporate
Governance
Performance Appraisal System
Bank Asia follows a well –structured performance appraisal system (commonly known as KPI’s – Key Performance Indicator) for evaluating
the performance of the employees. Bank Asia has already started online KPI’s system so that management evaluate employee’s performance
in a transparent way and ensure fair performance evaluation.
Promotion
In every year, Bank Asia awards promotion to the eligible employees keeping in view the quality of their respective job delivery and
performance.
Training and Development
The goal of training is for employees to master the knowledge, skill and behaviors emphasized in training programs and to apply them to
their day-to-day activities. Recently it has been acknowledged that to gain competitive advantage, training has to involve more than just
basic skill development.
Bank Asia always focuses great emphasis on training and development of its employees that’s why Bank Asia has its own training institute
with a dedicate HR people who are arranging trainings for the employees of Bank Asia. In 2017, Bank Asia Institute of Training and
Development (BAITD) remained very active throughout the year and arranged good number of training and workshop.
Training by Different Institutes:

2017 2016
Particulars
Nos. Hours Nos. Hours
In House Training 2,435 56,618 2,267 40,968
Bangladesh Bank 26 376 87 1,868
BIBM 54 1,233 110 1,880
Overseas/Foreign Training 26 1,218 33 928
Training by other institutes 70 1,650 80 2,034
Total No. of Participants & Man Hour 2,611 61,095 2,577 47,678
Learning Value Chain:

2017
Title of the Training Courses
No. of training
Foundation Training 5
Core Competency Course ( GB+Forex+Credit) 33
Orientation Program 4
Islamic Banking 6
Leadership Program 4
Soft Skill Development Program 14
ICT & i-stelar Operations 4
Risk Management Course 3
Agent Banking 3
Seminar (Sustainable Energy Financing) 1
Workforce Diversity
Bank Asia respects all employees as unique individuals with fundamental human rights and supports the cultural and ethnic diversity of
its workforce. Bank Asia beliefs that creating a work environment that enable to attract, retain and fully engage diverse talents leads to all
applicants without any bias to race, religion, gender, age, disability or any other criteria permissible by the statutory laws of the country.

Gender 2017 2016

No. of Employees % No. of Employees %

Male 1,591 76% 1508 77%
Female 496 24% 462 23%
Total 2,087 100% 1970 100%

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Corporate
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Gender Analysis
Age Group Total
Male 76%
Female 24% 30 & Below 511
31-40 1,201
41-50 338
51-60 37
61+ -
Total 2,087

Region wise Manpower Distribution

Region 2017 2016

Dhaka 1,540 1,377

Chittagong 362 412
Age distribution Sylhet 73 65
of employees
30 & Below 24% Rajshahi 43 45
31-40 58% Barishal 15 10
41-50 16% Khulna 40 46
51-60 2% Rangpur 14 15
61+ -
Human Resource Strength

Region 2017 2016

1540

Executive 370 366

1377

Region wise
Non-Executive 1700 1589
Manpower Support Staff 17 15
Distribution 1700
2017 2016 1589
Human
Resource
412
362

Strength
2017 2016
73
65

46

15
43
45

40

14
15
10
Dhaka

Chittagong

Sylhet

Rajshahi

Barishal

Khulna

Rangpur

370 366

17 15

Executive Non-Executive Support Staff

Healthy Work environment To create a healthy working environment the Bank gives priority by facilitating gym facility,
Bank Asia always think about the health canteen facility, separate prayer rooms for both male and female, sufficient sanitary
and safety of the employees, primarily facilities, pure drinking water, ambient lighting system, transport facility for female
through providing safeguards to Branches employees etc. Bank Asia covers medical insurance to ensure holistic medical security of its
with appropriate security arrangements. employees and also, group life insurance schemes cover the unforeseen risk of death
The Bank has fire safety alarms, fire
extinguishers and emergency exit in its Compensation & Benefits
all premises in order to safeguarding the To maintain the market competitiveness, the compensation and benefits of Bank Asia
lives of its employees, customers and are regularly reviewed through market and peer group study. All employees are paid
stakeholders in the event of conflagration. competitive remuneration package. The remuneration policy of the Bank does not allow

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 Corporate
Governance
any discrimination between male and
female employees. In addition, employees Long-Term Incentives/Rewards(Cash) Short-Term Incentives/Rewards(Cash)

are paid bonus based on yearly business 1. Provident fund;

2. Gratuity;
1. Yearly fixed and incentive bonus;
2. Yearly increment;
performance. In addition to monthly 3. Benevolent fund;
4. Employee house building loan with minimum
3. Business accomplishment financial award;
4. Special Increment for special
competitive base pay and a good number interest rate;
5. Provident fund loan with minimum interest rate;
assignments/accomplishment
5. Car, fuel and car maintenance
of allowances (e.g., House Rent allowance, 6. Periodically salary review (enhancement);
7. Furniture allowance for executives;
allowance for executives
6. Cash risk allowance for cashier
Medical allowance, Conveyance allowance 8. Yearly professional membership fees for
professional certificates holder;
7. Charge allowance for Head of Branches
8. Leave fair assistance
etc.), Bank Asia has variety of market 9. Leave encashment 9. Festival allowance
competitive Benefits schemes designed to
motivate the employees. The various cash Compensation &
and non-cash benefits include: Benefits:
Rewards and Recognition
Bank Asia has a well-designed rewards and
Short-Term Incentives/ Long-Term Incentives/
recognition programs for the employees Rewards(Non-Cash) Rewards(Non-Cash)
1. Foreign training award
to recognize their hard work, dedication, 1. Medical insurance coverage for self,
wife and two children
performance, efforts and behavior. 2. Accelerate promotion for top talents;
3. Study leave

Grievance management and Counseling

Bank Asia takes all allegations of harassment
seriously, including sexual, communal etc. is given in separate part of this Annual the Meeting on a timely basis to provide
and prohibits all forms of discrimination. Integrated Report. ample time for shareholders to receive
Employees will not suffer for raising and review the Notice and reply with their
Access to Information attendance. The Bank holds the AGM at a
grievance in good faith and Bank Asia does Prior to each Board meeting, the Bank
not tolerate any form of retaliation against central location with convenient access
Management provides the Board with to public transportation. Any registered
the employee(s) for sharing grievance. information relevant to matters on the shareholder who is unable to attend may
Organizational Chart agenda for the Board meeting. The choose one proxy to attend and vote on his
Organizational chart of Bank Asia limited are Management also provides adequate behalf. As the authentication of shareholder
presented in the page no .17 information in their regular reports identity information and the integrity of
pertaining to operational issues, financial the information transmitted still remain a
8. COMMUNICATION TO performance and any affairs that require concern, the Bank has decided, for the time
SHAREHOLDERS AND the attention of the Board. Such reports being, not to implement voting in absentia
enable the directors to be aware of key
STAKE HOLDERS by mail, email or fax. Shareholders are
issues pertaining to financial statements, allowed to speak in the AGM freely to give
Policy to facilitate effective
internal controls, compliance and risk their valuable suggestions.
communication with share
management of the Company. A risk
holders & other stakeholders
management dashboard that summarizes Shareholder Right
While maintaining investors’ relation proper
the main risks and key risk indicators is The Company advocates fair and equitable
communication and equitable treatment
presented during the board meeting to treatment to all shareholders. All price-
of every shareholders are given the highest
facilitate the oversight function by the sensitive information is timely disclosed
priority by Bank Asia. Bank Asia always
Board. In respect of budgets, material publicly. Shareholders are given the
share information to the concerned party
variances between the projections and opportunity to participate effectively in and
and publish integrated operational and
actual results are explained in the salient vote at general meetings of shareholders
financial information and takes initiative
reports circulated to the Board members. and they are informed of the rules, including
to enrich the ability of future assessment
Monthly and quarterly reports are provided voting rights and procedure that governs
of the bank by the shareholders. Bank
to directors. The Board has separate
always provides quarterly and half-annually such general meetings of shareholders.
and independent access to the Senior
financial statements and Annual Report to Shareholders are entitled to attend and vote
Management and the Company Secretary
provide balanced and clear assessment of its at the AGM by person or proxy.
at all times. Procedures are also in place
performance. Bank Asia also provides copies
for Directors and Board Committees,
of annual report to the related regulatory Redressal of Shareholders Complaints
where necessary, to seek independent
parties and it can also be found on Bank Any complaint, received at AGM or
professional advice at the Company’s
Asia website www.bankasia-bd.com with throughout the year, related to transfer
expense.
other related information.
and transmission of shares, non-receipt
Details in communications with different Policy on ensuring participation of
stakeholders is given in page no. 162-164 Shareholders at AGM of Annual Reports, and dividend timely
Bank Asia always ensures shareholders The Bank strongly encourages and and other share related matter is resolved
participation and providing opportunity for supports shareholder participation at its lawfully in time.
the shareholders participation in AGM which AGM. The Bank sends out the Notice of
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 Corporate
Governance
9. ENVIRONMENTAL AND SOCIAL OBLIGATION
Policies and practices relating to social and environmental responsibility of Bank Asia Limited
Bank Asia is committed to giving back to the society and advocating good environmental practices. Bank Asia carefully planned CSR
activities to address the various needs of the community as well as to encourage employees to play an active role.
In response to the worldwide call for global warming reduction, Bank Asia is committed to reduce energy usage and office consumables.
Reduction in paper usage is achieved by making reports available in soft copies and encouraging staff to print on both sides of the paper
and print documents only when necessary. To reduce power consumption, electrical devices and equipment are switched off when not
in use and lights in the buildings appropriately dimmed after office hours. Bank Asia will continue to raise the level of awareness amongst
staffs and step up on recycling efforts in all aspects of our operations. General description of Bank’s policies and practices relating to social
and environmental responsibility of Bank Asia Limited are described in page no.166-168, 185-187

Sustainability Reporting
Bank Asia is the first Bank in Bangladesh which has the pride to publish GRI Certified Sustainability Report. Since 2012 Bank Asia has
been publishing Sustainability Report as per GRI standard control index. Sustainability Report discloses how business impacts the social,
environmental and economic aspect of the surroundings. It also includes the aspect of Corporate Governance with importance.

Bank Asia’s Disclosure of specific activities undertaken by the entity in pursuance of these policies and practices
Bank Asia as a socially committed organization has taken several initiatives related with social and environmental responsibilities which
are described in page no.166-168, 185-187

CERTIFICATE AND COMPLIANCE CHECKLIST

Certificate on compliance of Corporate Governance Certificate from professional accountant on compliance of corporate governance is
governance is exhibited in page no.221 of the Annual Integrated Report 2017.

BSEC compliance for Chief Executive Officer and Chief Financial Officer’s Statements of Responsibilities
Chief Executive Officers and Chief Financial Officer Statement in line with BSEC notification is given in page no.201

Status of compliance in line with Bangladesh Securities and Exchange Commission (BSEC) regulation
Status of compliance with the conditions imposed by the Commission’s Notification No SEC/CMRRCD/2006-158/134/Admin/44 dated 07
August 2012 issued under section 2CC of the Securities and Exchange Ordinance, 1969: (Report under Condition No. 7.00) is exhibited
in a separate segment page no.223-230

Status of compliance in line with Bangladesh Bank regulation

Status of compliance in line with Bangladesh Bank regulation is given in page no.233-243

Annual Integrated Report 2017

217
Corporate
Governance
Committee Meeting
Board meeting held in 2017
Statement of Board meetings held and the attendance of Directors from 01.01.2017 to 31.12.2017 (355th Board to 375th Board) : 21

Total Board No. of meeting No. of meeting

SI No. Name Remarks
meeting held attended absent
1. Mr. A Rouf Chowdhury 21 20 1
2. Mr. Mohd. Safwan Choudhury 21 15 6
3. Mr. A M Nurul Islam 16 16 0 Up to 18.10.2017
4. Mr. Rumee A Hossain 9 9 0 Up to 03.07.2017
5. Ms. Hosneara Sinha 21 0 21
6. Ms. Farhana Haq Chowdhury 9 1 8 Up to 03.07.2017
7. Mr. M Irfan Syed 21 12 9
8. Ms. Naheed Akhter Sinha 21 0 21
9. Mr. M Shahjahan Bhuiyan 21 17 4
10. Mr. Md Nazrul Huda 21 20 1
11. Mr. Mashiur Rahman 21 18 3
12. Mr. Mir Shahjahan 9 0 9 Up to 03.07.2017
Major General Mohammad
13. 11 10 1 From 03.07.2017
Matiur Rahman, ndu, psc (retd.)
14. Ms. Romana Rouf Chowdhury 11 10 1 From 03.07.2017
The Board has granted leave of absence against the absentee directors of the meeting.
Executive Committee (EC) meeting held in 2017
Statement of Executive Committee (EC) meetings held and the attendance of Directors from 01.01.2017 to 31.12.2017 (203rd EC to 250th EC): 48

Total EC meeting No. of meeting No. of meeting

Sl No. Name Remarks
held Attended absent
1. Mr. A Rouf Chowdhury 48 44 4
2. Mr. M Shahjahan Bhuiyan 48 40 8
3. Mr. Md Nazrul Huda 48 45 3
4. Mr. M Irfan Syed 48 26 22
5. Ms. Romana Rouf Chowdhury 22 20 2 From 03.07.2017
6. Mr. Rumee A Hossain 26 26 0 Up to 03.07.2017

The EC has granted leave of absence against the absentee directors of the meeting.
Audit Committee (AC) meeting held in 2017
Statement of Audit Committee meetings held and the attendance of Directors from 01.01.2017 to 31.12.2017 (185th to 193rd Audit): 9

No. of meeting No. of meeting

SI No. Name Total Audit meeting held Remarks
attended absent
1. Mr. Mashiur Rahman 9 9 0
2. Mr. A M Nurul Islam 8 8 0 Up to 18.10.2017
3. Mr. Mohd. Safwan Choudhury 9 5 4
The Audit Committee has granted leave of absence against the absentee directors of the meeting

Bank Asia Limited

218
 Corporate
Governance

Risk Management Committee meeting held in 2017

Statement of Risk Management Committee meetings held and the attendance of Directors from 01.01.2017 to 31.12.2017 (24th to 29th
RMC): 6

Total Board No. of No. of meeting

SI No. Name Remarks
meeting held meeting attended absent
1. Mr. M Irfan Syed 6 4 2
2. Mr. A M Nurul Islam 4 4 0 Up to 18.10.2017
3. Mr. A Rouf Chowdhury 4 3 1 From 03.07.2017
4. Mr. Md. Nazrul Huda 4 4 0 From 03.07.2017
5. Ms. Romana Rouf Chowdhury 4 4 0 From 03.07.2017
6. Ms. Farhana Haq Chowdhury 2 0 2 Up to 03.07.2017
7. Mr. Rumee A Hossain 2 2 0 Up to 03.07.2017
The Risk Management Committee has granted leave of absence against the absentee directors of the meeting
Shareholding Structure
At the end of the year 2017, the shareholding structure of Bank Asia Limited was as follows:

No. of
Total No. of shares % of total holdings
Category shareholders
as on 31-12-2017 as on 31-12-2017
As on 31-12-2017
Sponsor & Director 27 509,909,013 51.66
General Public 10,219 159,542,368 16.17 Share
Foreign Investments 3 6,382,997 0.65 Holding
Investment Companies 75 64,773,405 6.56 Structure
Institutions 281 239,465,916 24.26 Sponsor & Director 51.66%
General Public 16.17%
Non Resident Bangladeshi 76 6,937,400 0.70 Foreign Investments 0.65%
Total 10,681 987,011,099 100.00 Investment Companies 6.56%
Institutions 24.26%
Classification of shareholders by holding as on 31.12.2017 Non Resident Bangladeshi 0.70%

No. of shareholders % of total holdings

Holding Shares
as on 31-12-2017 as on 31-12-2017
less than 5000 8,227 1.07 10,512,591
5000 to 50000 2,037 2.86 28,199,353
50001 to 100000 135 0.99 9,744,512
100001 to 200000 88 1.26 12,399,939
200001 to 300000 38 0.94 9,309,388
300001 to 400000 10 0.35 3,500,434
400001 to 500000 15 0.70 6,934,342
500001 to 1000000 29 2.20 21,736,763
1000001 to 10000000 76 25.59 252,593,106
over 10000000 26 64.04 632,080,671
TOTAL 10,681 100.00 987,011,099

Annual Integrated Report 2017

219
 Corporate
Governance

Pattern of Shareholding
Breakup of shareholding pattern as per clause 1.5 (xxi) of Bangladesh Securities and Exchange Commission notification no. SEC/
CMRRCD/2006-158/134/Admin/44 dated 07 August 2012 issued under Section 2CC of the Securities and Exchange Ordinance, 1969, is as
follows:
a) Parent/Subsidiary/Associated companies and other related parties (name wise details):

SI No. Name of the Company Shareholding Structure

1 Bank Asia Securities Limited 99.997% owned by Bank Asia
2 BA Exchange Company (UK) Limited 100% owned by Bank Asia
3 BA Express USA Inc. 100% owned by Bank Asia
b) Directors, Chief Executive Officer, Chief Financial Officer, Head of Internal Audit, Company Secretary and their spouse and minor children
(name wise details)

No. of shares held as on

Sl. No. Name of The Directors
31-12-2017
1 Mr. A. Rouf Chowdhury and his spouse 31,129,536
2 Mr. Mohd. Safwan Choudhury (Representing Phulbari Tea Estates Ltd.) 38,659,258
3 Ms. Hosneara Sinha and her Spouse 51,383,484
4 Major General Mohammad Matiur Rahman (retd.) 19,810,739
(Representing Sinha Fashions Limited.)
5 Ms. Romana Rouf Chowdhury (Representing Maya Limited) 35,283,976
6 Mr. Mohammed Irfan Syed (Representing Amiran Generations Limited) 40,261,275
7 Ms. Naheed Akhter Sinha and her Spouse 53,756,228
8 Mr. Mashiur Rahman (Independent Director Nil
9 Mr. M Shahjahan Bhuiyan (Independent Director) Nil
10 Mr. Md. Nazrul Huda (Independent Director) Nil
Total 270,284,496

Chief Executive Officer, Chief Financial Officer, Head of Internal Audit, Company Secretary and their spouse

1 Chief Executive Officer’s Spouse 79

2 Company Secretary 2300
3 Chief Financial Officer Nil
4 Head of ICCD Nil
c) Executives

1 Mr. Md. Zahirul Alam Nil

2 Mr. Mohammad Borhanuddin Nil
3 Mr. Md. Sazzad Hossain Nil
4 Mr. Sarder Akhter Hamed Nil
5 Mr. Md. Ariful Islam Choudhury Nil
Shareholders holding ten percent (10%) or more voting interest in the company: Nil

Bank Asia Limited

220
 Credit Rating Corporate Governance
Certificate Compliance Certificate

Annual Integrated Report 2017

221
 Corporate
Governance
Compliance
Checklist

Bank Asia Limited

222
Corporate Governance Compliance Checklist in
line with Bangladesh Securities and Exchange
Commission (BSEC) Regulation

Status of compliance with the condition imposed by the Commission’s Notification No. letter SEC/CMRRCD/2006-158/134/Admin/44,
dated 07 August, 2012 issued under section 2CC of the Securities and Exchange Ordinance, 1969 (Report under Condition No. 7.00) is
exhibited in a separate segment.

Condition Not
Title Complied Remarks (IF ANY)
No. Complied
1 BOARD OF DIRECTORS
1.1 Boards size
The Bank Asia Board
The number of the board members of the company shall not is comprised of 11
√
be less than 5 (five) and more than 20 (twenty). Directors Including
Managing Director.
1.2 Independent Directors
At least one fifth (1/5) of the total number of directors in the
(i) √
company’s board shall be independent directors.
For the purpose of this clause 'Independent directors' means
(ii)
a director-
Who either does not hold any share in the company or holds The Independent Di-
a) less than one percent (1%) shares of the total paid-up shares √ rector have declared
of the company; their compliance
Who is not a sponsor of the company and is not connected
with the company's any sponsor or director or shareholder
who holds one percent (1%) or more shares of the total paid-
b) √
up shares of the company on the basis of family relationship.
His/her family members also should not hold above men-
tioned shares in the company :
Who does not have any other relationship, whether pecuni-
c) ary or otherwise, with the company or its subsidiary/ associ- √
ated companies;
Who is not a member, director, or officer of any stock ex-
d) √
change;
Who is not a shareholder, director or officer of any member of
e) √
stock exchange or an intermediary of the capital market;
Who is not a partner or an executive or was not a Partner or
f) an executive during the preceding 3 (three) years of the con- √
cerned company's statutory audit firm;
Who shall not be an independent director in more than 3
g) √
(three) listed companies;
Who has not been convicted by a court of competent juris-
h) diction as a defaulter in payment of any loan to a bank or a √
Non-Bank Financial Institution (NBFI);
Who has not been convicted for a criminal offence involving
i) √
moral turpitude.

Annual Integrated Report 2017

223
 Corporate
Governance

Condition Not
Title Complied Remarks (IF ANY)
No. Complied
The independent director(s) shall be appointed by the board
(iii) of directors and approved by the shareholders in the Annual √
General Meeting (AGM).
The post of independent director(s) can not remain vacant for
(iv) √
more than 90(ninety) days.
The Board shall lay down a code of conduct of all Board
(v) √
members and annual compliance of the code to be recorded.
The tenure of office of an independent director shall be for a
(vi) period of 3(three) years, which may be extended for 1(one) √
term only.
1.3 Qualification of Independent Director (ID)
Independent director shall be a knowledgeable individual
with integrity who is able to ensure compliance with finan-
(i) √
cial, regulatory and corporate laws and can make meaningful
contribution to business.
The person should be a Business Leader/ Corporate Leader/
Bureaucrat/University Teacher with Economics or Business
Studies or Law background/Professionals like Chartered
(ii) Accountants, Cost & Management Accountants, and Char- √
tered Secretaries. The independent director must have a least
12(twelve) years of corporate management /professional
experiences.
In special cases the above qualifications may be relaxed sub-
(iii) √ Not Applicable
ject to prior approval of the Commission.
1.4 Chairman of the Board and Chief Executive Officer
The position of the chairman of the Board and the Chief Exec-
Different persons
utive Officer of the companies shall be filled by different indi-
hold the position
viduals. The chairman of the company shall be elected from
(i) √ with specific respon-
among the directors of the company. The Board of Directors
sibilities set by the
shall clearly define respective roles and responsibilities of the
Board
chairman and the chief executive officer.
1.5 Directors Report to the Shareholders
Industry outlook and possible future developments in the
(i) √
industry.
(ii) Segment-wise or product-wise performance. √
(iii) Risks and concerns. √
A discussion on Cost of Goods sold, Gross Profit Margin and
(iv) √
Net Profit Margin.
(v) Discussion on continuity of any Extra-Ordinary gain or loss. √ Not Applicable
Basis for related party transactions-a statement of all related
(vi) √
party transactions should be disclosed in the annual report.

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224
Corporate
Governance

Condition Not
Title Complied Remarks (IF ANY)
No. Complied
Utilization of proceeds from public issues, rights issues and/
(vii) √ Not Applicable
or through any others instruments.
An explanation if the financial results deteriorate after the
No such matter to
(viii) company goes for Initial Public Offering (IPO), Repeat Public √
explain
Offering (RPO). Rights Offer, Direct Listing, etc.
If significant variance occurs between Quarterly Financial
No such matter to
(ix) Performance and Annual Financial Statements the manage- √
explain
ment shall explain about the variance on their Annual Report.
(x) Remuneration to directors including independent directors. √
The financial statements prepared by the management of the
(xi) issuer company present fairly its state of affairs, the result of √
its operations, cash flows and changes in equity.
Proper books of account of the issuer company have been
(xii) √
maintained.
Appropriate accounting policies have been consistently ap-
plied in preparation of the financial statements and that the
(xiii) √
accounting estimates are based on reasonable and prudent
judgment.
International Accounting Standards (IAS)/Bangladesh Ac-
counting Standards (BAS)/International Financial Reporting
Standard (IFRS)/Bangladesh Financial Reporting Standards
(xiv) √
(BFRS), as applicable in Bangladesh, have been followed in
preparation of the financial statements and any departure
there-from has been adequately disclosed.
The system of internal control is sound in design and has
(xv) √
been effectively implemented and monitored.
There are no significant doubts upon the issuer company's
ability to continue as a going concern. If the issuer company
(xvi) √
is not considered to be a going concern, the fact along with
reasons thereof should be disclosed.
Significant deviations from the last year's operating results
No such matter to
(xvii) of the issuer company shall be highlighted and the reasons √
explain
thereof should be explained.
Key operating and financial data of at least preceding 5 (five)
(xviii) √
years shall be summarized.
if the issuer company has not declared dividend(cash or
(xix) √
stock) for the year, the reasons thereof shall be given.
The number of Board meetings held during the year and
(xx) √
attendance by each director shall be disclosed.
The Pattern of shareholding shall be reported to disclose the
(xxi) aggregate number of shares (along with name wise details √
where stated below) held by:

Annual Integrated Report 2017

225
 Corporate
Governance

Condition Not Com-

Title Complied Remarks (IF ANY)
No. plied
Parent/Subsidiary/Associated Companies and other related
(xxi) a) √
parties (name wise details);
Directors, Chief Executive Officer, Company Secretary, Chief
(xxi) b) Financial Officer, Head of Internal Audit and their spouses √
and minor children (name wise details);
(xxi) c) Executives; √ Not Applicable
Shareholders holding ten percent (10%) or more voting inter-
(xxi) d) √ Not Applicable
est in the company (name wise details).
In case of the appointment/re-appointment of a director
(xxii) the company shall disclose the following information to the
shareholders:
(xxii) a) a brief resume of the director; √
(xxii) b) nature of his/her expertise in specific functional areas; √
Names of companies in which the person also holds the di-
(xxii) c) √
rectorship and the membership of committees of the board.
CHIEF FINANCIAL OFFICER (CFO), HEAD OF INTERNAL
2.0
AUDIT AND COMPANY SECRETARY (CS)
The Company has
appointed CFO, CS
and Head of Inter-
The company shall Appoint a Chief Financial Officer (CFO), nal Audit. There are
a Head of Internal Audit (Internal Control and Compliance) clearly defined roles,
2.1
and a Company Secretary (CS). The Board of Directors should √ responsibilities and
Appointment
clearly define respective roles,responsibilites and duties of duties which have
the CFO, the Head of internal Audit and the CS. been approved by
Board as per re-
quirement of BSEC
notification.
The CFO and the Company Secretary of the companies shall
2.2 Require-
attend the meetings of the Board of Directors, provided that
ment to
the CFO and/or the Company Secretary shall not attend such
attend the √ In Practice
part of a meeting of the Board of Directors which involves
Board Meet-
consideration of an agenda item relating to their personal
ings
matters.
3.0 AUDIT COMMITTEE
The company shall have an Audit Committee as a sub-com-
(i) √ Already In Practice
mittee of the Board of Directors.
The Audit Committee shall assist the Board of Directors in en-
suring that the financial statements reflect true and fair view
(ii) √ In Practice
of the state of affairs of the company and in ensuring a good
monitoring system within the business.

Bank Asia Limited

226
Corporate
Governance

Condition Not Com-

Title Complied Remarks (IF ANY)
No. plied
The Audit Committee shall be responsible to the Board of
(iii) Directors. The duties of the Audit Committee shall be clearly √ In Practice
set forth in writing
3.1 Constitution of the Audit Committee
The Audit Committee shall be composed of at least 3 (three)
(i) √
members.
The Board of Directors shall appoint members of the audit
(ii) committee who shall be directors of the company and shall √
include at least 1 (one) independent director.
All the existing
members of the
Audit Committee are
All members of the audit committee should be "financially “Financially literate”
(iii) literate" and at least I (one) member shall have accounting or √ and they have relat-
related financial management experience, ed financial manage-
ment experience as
per BSEC notifica-
tion.
When the term of service of the Committee members expires
or there is any circumstance causing any Committee mem-
ber to be unable to hold office until expiration of the term of
service, thus making the number of the Committee members
to be lower than the prescribed number of 3 (three) persons, No such incidence
(iv) √
the Board of Directors shall appoint the new Committee arose
member(s) to fill up the vacancy(ies) immediately or not later
than 1 (one) month from the date of vacancy(ies) in the Com-
mittee to ensure continuity of the performance of work of the
Audit Committee.
The company secretary shall act as the secretary of the Com-
(v) √ In Practice
mittee.
The quorum of the Audit Committee meeting shall not consti-
(vi) √ In Practice
tute without at least 1 (one) independent director.
3.2 Chairman of the Audit Committee
The Board of Directors shall select 1 (one) member of the Au-
(i) dit Committee to be Chairman of the Audit Committee, who √
shall be an independent director.
Chairman of the Audit Committee shall remain present in the
(ii) √
Annual General Meeting (AGM).
3.3 Role of Audit Committee
(i) Oversee the financial reporting process. √
(ii) Monitor choice of accounting policies and principles. √
(iii) Monitor Internal Control Risk management process. √
(iv) Oversee hiring and performance of external auditors. √
Review along with the management, the annual financial,
(v) √
statements before submission to the board for approval.
Review along with the management, the quarterly and half
(vi) yearly financial statements before submission to the board √
for approval.
(vii) Review the adequacy of internal audit function. √
Annual Integrated Report 2017
227
 Corporate
Governance

Condition Not Com-

Title Complied Remarks (IF ANY)
No. plied
Review statement of significant 'related party transactions
(viii) √
submitted by the management.
Review Management Letters/ Letter of Internal Control weak-
(ix) √
ness issued by statutory auditors.
When money is raised through Initial Public Offering (IPO)/
Repeat Public Offering (RPO)/Rights Issue the company shall
disclose to the Audit Committee about the uses/applications
of funds by major category (capital expenditure, sales and There was no IPO/
(x) marketing expenses, working capital, etc), on a quarterly ba- √ RPO/Rights issue in
sis, as a part of their quarterly declaration of financial results. 2017
Further, on an annual basis, the company shall prepare a
statement of funds utilized for the purposes other than those
stated in the offer document/prospectus.
3.4 Reporting of Audit Committee
The Audit Committee shall report on its activities to the
(i) √
Board of Directors.
The Audit Committee shall immediately report to the Board
(ii) √
of Directors on the following findings, if any:-
No such incidence
3.4.1 (ii) a) Report on conflicts of interests;
arose
suspected or presumed fraud or irregularity or material de- No such incidence
b) √
fect in the internal control system; arose
suspected infringement of laws, including securities related No such incidence
c) √
laws, rules and regulations; arose
any other matter which shall be disclosed to the Board of No such incidence
d) √
Directors immediately. arose
If the Audit Committee has reported to the Board of Directors
about anything which has material impact on the financial
condition and results of operation and has discussed with the
3.4.2 Board of Directors and the management that any rectification
Reporting to is necessary and if the Audit Committee finds that such recti- No such reportable
√
the Author- fication has been unreasonably ignored, the Audit Committee incidence arose
ities shall report such finding to the Commission, upon reporting
of such matters to the Board of Directors for three times or
completion of a period of 6 (six) months from the date of first
reporting to the Board of Directors, whichever is earlier.
3.5 Reporting to the Shareholders and General Investors
Report on activities carried out by the Audit Committee,
including any report made to the Board of Directors under
condition 3.4.1 (ii) above during the year, shall be signed by √
the Chairman of the Audit Committee and disclosed in the
annual report of the issuer company.

Bank Asia Limited

228
Corporate
Governance

Condition Not Com-

Title Complied Remarks (IF ANY)
No. plied
4 EXTERNAL/ STATUTORY AUDITORS
The issuer company should not engage its external/statutory auditors to perform the following services of the company; namely:-
(i) Appraisal or valuation services or fairness opinions. √
(ii) Financial information system design and implementation √
Book-keeping or other services related to the accounting
(iii) √
records or financial statement
(iv) Broker –dealer services √
(v) Actuarial services √
(vi) Internal audit services √
(vii) Any other services that the audit committee determines. √
No partner or employees of the external audit firms shall
(viii) possess any share of the company they audit at least during √
the tenure of their audit assignment of that company.
Audit/ Certifiaction services on compliance of corporate gov-
(ix) √
ernance as required under clause (i) of condition no. 7
5 SUBSIDIARY COMPANY
Provisions relating to the composition of the Board of Di-
rectors of the holding company shall be made applicable to
(i) √
the composition of the Board of Directors of the subsidiary
company.
At least 1 (one) independent director of the Board of Directors
(ii) of the holding company shall be a director on the Board of √
Directors of the subsidiary company.
The minutes of the Board meeting of the subsidiary company
(iii) shall be placed for review at the following Board meeting of √
the holding company.
The minutes of the respective Board meeting of the holding
(iv) company shall state that they have reviewed the affairs of the √
subsidiary company also.
The Audit Committee of the holding company shall also re-
(v) view the financial statements, in particular, the investments √
made by the subsidiary company.
DUTIES OF CHIEF EXECUTIVE OFFICER (CEO) AND CHIEF
6
FINANCIAL OFFICER(CFO)
The CEO and CFO shall certify to the Board that:-
They have reviewed financial statements for the year and
(i) √
that to the best of their knowledge and belief:

Annual Integrated Report 2017

229
 Corporate
Governance

Condition Not Com-

Title Complied Remarks (IF ANY)
No. plied
These statements do not contain any materially untrue state-
a) ment or omit any material fact or contain statements that √
might be misleading;
These statements together present a true and fair view of
b) the company’s affairs and are in compliance with existing √ In Practice
accounting standards and applicable laws.
There are, to the best of knowledge and belief, no transac-
tions entered into by the company during the year which are
(ii) √ In Practice
fraudulent illegal or in violation of the company's code of
conduct.
REPORTING AND COMPLIANCE OF
7
CORPORATE GOVERNANCE
Required certifi-
The company shall obtain a certificate from a practicing cation has been
Professional Accountant/Secretary (Chartered Accountant/ obtained from ‘’POD-
Cost and Management Accountant/Chartered Secretary) DER & ASSOCIATES”
(i) √
regarding compliance of conditions of Corporate Governance Cost & Management
Guidelines of the Commission and shall send the same to the Accountants for the
shareholders along with the Annual Report on a yearly basis. year ended 31st Dec
2017.
The directors of the company shall state, in accordance with
(ii) the Annexure attached, in the directors' report whether the √
company has complied with these conditions.

Bank Asia Limited

230
Compliance Checklist In Line With the
Companies Act, 1994

The directors of the companies shall include the following additional statements in the Directors’ Report prepared under section 184 of
the Companies Act, 1994 (Act No. XVIII of 1994):-

Industry outlook and possible future developments in the

a Discussed in the Directors’ report
industry
Segment-wise or product-wise performance b Discussed in the Directors’ report
Discussed in a disclosure on Risk Based
Risks and concerns c Capital under Pillar-3 of Basel- III, CRO’s report and Risk
Management Report.
A discussion on Cost of Goods sold, Gross Profit Margin
d Discussed in Chief Financial Officer’s report.
and Net Profit Margin
Discussion on continuity of any Extra-Ordinary The Bank did not make any extra-ordinary
e
Gain or loss Gain or loss in 2016.
Basis for related party transactions- a statement of all
related party transactions should be disclosed in the f Given in notes to the financial statements
annual report
Utilization of proceeds from public issues, rights issues
g In 2017, the bank did not go for any public issues and right issues.
and/or through any others instruments
An explanation if the financial results deteriorate after The financial results of the bank was not
the company goes for Initial Public Offering (IPO), Repeat h deteriorated after the company went for
Public Offering (RPO), Rights Offer, Direct Listing, etc. Rights Offer.
If significant variance occurs between Quarterly Financial
performance and Annual Financial Statements the No significant variance occurred between quarterly financial
i
management shall explain about the variance on their performance and annual financial statements.
Annual Report
Remuneration to directors including independent Discussed in the Corporate Governance
j
directors Report
The financial statements prepared by the Discussed in Chief Executive Officer and
management of the issuer company present Chief Financial Officer’s statement of
k
fairly its state of affairs, the result of its Responsibilities.
Operations, cash flows and changes in equity
Proper books of account of the issuer company have been Discussed in Chief Executive Officer and
l
maintained. Chief Financial Officer’s statement of responsibilities.
Appropriate accounting policies have been consistently
applied in preparation of the financial statements and
m Discussed in notes to the financial statements
that the accounting estimates are based on reasonable
and prudent judgment
International Accounting Standards (IAS)/
Bangladesh Accounting Standards (BAS)/
International Financial Reporting Standards
(IFRS)/Bangladesh Financial Reporting Standards (BFRS), n Discussed in notes to the financial statements
as applicable in Bangladesh, have been followed in
preparation of the financial statements and any departure
there-from has been adequately disclosed

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 Corporate
Governance

The system of internal control is sound

The system of internal control is sound in design and has in design and has been effectively implemented and monitored. A
o
been effectively implemented and monitored detailed discussion is given under internal control and compliance
part of Directors report.

There are no significant doubts upon the issuer

company’s ability to continue as a going concern. If the There are no significant doubts on the
p
issuer company is not considered to be a going concern, Bank’s ability to continue as a going concern.
the fact along with reasons thereof should be disclosed

In 2017, on consolidated basis banks operating profit was Tk. 6,933

million which was increased by 12.04% than the previous year. On
solo basis, the bank’s operating profit was 6,688 million which was
Significant deviations from the last year’s operating also increased by 13% than the previous year. Net Profit increased
results of the issuer company shall be highlighted and the by 32% that resulted from increase of operating profit by 13%, lower
q
reasons thereof should be explained requirement of provision (decreased by 0.14%) and effective tax
management. Bank’s CL ratio stood at 4.38% in 2017 from 5.41%
in 2016. In 2017 Bank need to keep total provision of Tk. 2,630.02
million which was Tk. 2,633.72 million in last year resulted decrease
of provision by 0.14% due to lower classified loan.
Key operating and financial data of at least preceding 5
(five) years shall be summarized r Given in separate statement.

If the issuer company has not declared dividend (cash or

s The Bank has been declaring dividend every year.
stock) for the year, the reasons thereof shall be given
The number of Board meetings held during the year and
Discussed in the Corporate Governance report and notes to the
attendance by each director shall be disclosed t
financial statements

The pattern of shareholding shall be reported

to disclose the aggregate number of shares
(along with name wise details where stated
below) held by:-
a) Parent/Subsidiary/Associated Companies and other
related parties (name wise details); b) Directors, Chief Discussed in the Corporate Governance
u
Executive Officer, Company Secretary, Chief Financial Report and notes to the financial statements
Officer, Head of Internal Audit and their spouses and
minor children (name wise details); c) Executives;
d) Shareholders holding ten percent (10%) or more voting
interest in the company (name wise details)

In case of the appointment/re-appointment

of a director the company shall disclose the
following information to the shareholders:-
a)a brief resume of the director; b) nature of his/her
Discussed in notes to the financial statements and Directors’
expertise in specific functional areas; v
Profile.
c) names of companies in which the person also holds the
directorship and the membership of committees of the
board

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Status of Compliance of Bangladesh Bank’s
guidelines for Corporate Governance (BRPD)
circular no. 11 dated 27.10.2013)

Compliance
Sl No. Particulars
Status
1 FORMATION OF BOARD OF DIRECTORS
The newly amended Section 15 of the Bank Company Act, 1991 (Amended upto 2013) includes provisions
for prior approval of Bangladesh Bank before the appointment of new bank directors, as well as dismissal,
Complied
termination or removal of any director from the post; director’s fit & proper criteria; maximum number of
directors; appointment of independent directors; appointment of maximum 2(two) members from a family
as director; etc.
1.1 Appointment of New directors:
Under section 15(4) of the Bank Company Act, 1991 (amended upto 2013), every banking company,
other than specialized banks, at the time of taking prior approval from Bangladesh Bank for appointing/
reappointing directors should furnish the following documents along with the application:

a) Personal information of the nominated person (Appendix-ka);

b) Nominated person’s declaration(Appendix-kha); Complied
c) ‘Declaration for confidentiality’ by the nominated person(Appendix-ga);
d) In case of Independent director, the approval letter from Security and Exchange commission;
e) In case of Independent director, a declaration of the directors concern as Appendix-gha (he will also
submit declaration under Appendix-ka, kha & ga);
f) CIB report of the nominated person;
g) Updated list of the directors.
1.2 Vacation of office of Director:
a) The office of director shall be vacated according to the instructions specified in section 108(1) of the
Companies Act, 1994. Besides, when a bank director becomes defaulter and does not repay the loan
within two months after getting a notice under the section 17 of the Bank Company Act, 1991; provides
false statement at the time of appointment; or fails to fulfil the minimum eligibility criteria, the office of
the director will be vacated.
b) If the office of a director is vacated by a notice under the section 17 of BCA, the person will not be
eligible to become a director of the bank or any other bank or any financial institution for one year from
Complied
the date of repayment of the total amount due to the bank. It is mentionable here that the dues can
be adjusted with the shares held by the director in that bank. When a director receives a notice under
section 17 of BCA, 1991, he/she can’t transfer his/her shares of that bank until he/she repays all the
liabilities of the noticed bank or financial institution.
c) Besides, Bangladesh Bank can remove a director or chairman of a bank, except state owned banks, for
conducting any kind of activities that is detrimental to the interest of the banks depositors or against the
public interest under Section 46 and can supersede the board of a banking company under Section 47
of BCA, 1991.
1.3 Removal of Directors from office:
According to section 108(2) of the Companies Act, 1994, with the prior approval of Bangladesh Bank, a bank
director other than specialized banks can be removed from his office for the reason specified in its Articles
N/A
of Association. For this purpose, the reason and grounds of the dismissal/removal and copy of the decision
of the board and list of directors should be submitted to Bangladesh Bank. In this case, the removal will be
effective from the date of Bangladesh Bank’s approval.

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Compliance
Sl No. Particulars
Status
1.4 Appointment of Alternate Director
Subject to compliance of section 101 of the Companies Act, 1994, an alternate director can be appointed
to act for a director during his absence for a continuous period of not less than three months from
Bangladesh. In this context, the following instructions should be followed:

a) Bank has to collect and properly maintain the documentary evidences relating to departure and arrival
of the original director. If there is any exception, the chief executive officer should immediately inform it
to Bangladesh Bank.
b) The copy of the decision of the board regarding appointment of alternate director, with original
director’s probable returning date from abroad should be sent to Bangladesh Bank within 7 days of N/A
taking the decision and the director’s arrival date must be intimated to Bangladesh Bank immediately
after his return.
c) Any loan defaulter or any person who is not eligible to become a director as per any rules & regulation
will not be appointed as an alternate director.
d) As appointment of alternate director is a temporary measure; therefore, he/she will not be included in
any kind of committee constituted by the board.
e) While in the office, an alternate director or his/her affiliated organization will not get any kind of loan
facilities from his bank. In case of previous loan, enhancement of limit or extension of time period or any
kind of exemption or interest waiver will not be allowed. Moreover, all restrictions applicable to directors
according to rules & regulations will also be applicable to the alternate director.
2. DEPOSITOR DIRECTOR
As the previous provisions regarding appointment of Depositor Directors of the Bank Company Act, 1991
has been amended; appointment of director from depositors is no longer required. But, after complying N/A
regulation under sec 15(9) of the Bank Company Act, 1991 (amended upto 2013) bank can consider the
tenure of existing depositor director or may appoint them as independent director.
3. INFORMATION REGARDING DIRECTORS
Banks are advised to take the following steps regarding director information: Every bank should keep an
updated list of bank directors,
Complied
a) Banks should send a directors’ list to other banks or financial institutions immediately after the
appointment or release of director.
b) Banks should display a list of directors in the website and update it on a regular basis.
4. RESPONSIBILITIES OF THE BOARD OF DIRECTORS
4.1 Responsibilities and authorities of the board of directors:
(a) Work-planning and strategic Management:
i) shall determine the objectives and goals and to this end shall chalk out strategies and work-plans
on annual basis. It shall specially engage itself in the affairs of making strategies consistent with the
determined objectives and goals and in the issues relating to structural change and reorganization for
enhancement of institutional efficiency and other relevant policy matters. It shall analyze/monitor at
quarterly rests the development of implementation of the work-plans. Complied

ii) The board shall have its analytical review incorporated in the Annual Report as regard the success/
failure in achieving the business and other targets as set out in its annual work-plan and shall apprise
the shareholders of its opinions/recommendations on future plans and strategies. It shall set the Key
Performance Indicators (KPIs) for the CEO and other senior executives and have it evaluated at times.

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Compliance
Sl No. Particulars
Status
(b) Credit and risk management
i) The policies, strategies, procedures etc. in respect of appraisal of loan/investment proposal, sanction,
disbursement, recovery, reschedule and write-off thereof shall be made with the board’s approval under
the purview of the existing laws, rules and regulations. The board shall specifically distribute the power
of sanction of loan/investment and such distribution should desirably be made among the CEO and his
subordinate executives as much as possible. No director, however, shall interfere, direct or indirect, into
Complied
the process of loan approval.

ii) The board shall frame policies for risk management and get them complied with and shall monitor the
compliance at quarterly rests and review the concerned report of the risk management team and shall
compile in the minutes of the board meeting. The board shall monitor the compliance of the guidelines
of Bangladesh Bank regarding key risk management.
(c) Internal control management
The board shall be vigilant on the internal control system of the bank in order to attain and maintain
satisfactory qualitative standard of its loan/investment portfolio. The board will establish such an internal
Complied
control system so that the internal audit process can be conducted independently from the management.
It shall review the reports submitted by its audit committee at quarterly rests regarding compliance of
recommendations made in internal and external audit reports and the Bangladesh Bank inspection reports.
(d) Human resources management and development
i) Policies relating to recruitment, promotion, transfer, disciplinary and punitive measures, human
resources development etc. and service rules shall be framed and approved by the board. The chairman
or the directors shall in no way involve themselves or interfere into or influence over any administrative
affairs including recruitment, promotion, transfer and disciplinary measures as executed under the set
service rules. No member of the board of directors shall be included in the selection committees for
recruitment and promotion to different levels. Recruitment, promotion, transfer & punishment of the
officers immediate two tiers below the CEO shall, however, rest upon the board. Such recruitment and
promotion shall have to be carried out complying with the service rules i.e., policies for recruitment and
promotion. Complied

ii) The board shall focus its special attention to the development of skills of bank’s staff in different fields
of its business activities including prudent appraisal of loan/investment proposals, and to the adoption
of modern electronic and information technologies and the introduction of effective Management
Information System (MIS). The board shall get these programmes incorporated in its annual work plan.

iii) The board will compose Code of Ethics for every tier and they will follow it properly. The board will
promote healthy code of conducts for developing a compliance culture.
(e) Financial management
i) The annual budget and the statutory financial statements shall be finalized with the approval of the
board. It shall at quarterly rests review/monitor the positions in respect of bank’s income, expenditure,
liquidity, non-performing asset, capital base and adequacy, maintenance of loan loss provision and
steps taken for recovery of defaulted loans including legal measures.
ii) The board shall frame the policies and procedures for bank’s purchase and procurement activities
Complied
and shall accordingly approve the distribution of power for making such expenditures. The maximum
possible delegation of such power of expenditures shall rest on the CEO and his subordinates. The
decision on matters relating to infrastructure development and purchase of land, building, vehicles etc.
for the purpose of bank’s business shall, however, be adopted with the approval of the board.
iii) The board will review whether an Asset-Liability Committee (ALCO) has been formed and it is working
according to Bangladesh Bank guidelines.

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Compliance
Sl No. Particulars
Status
(f) Appointment of Chief Executive Officer (CEO)
In order to strengthen the financial base of the bank and obtain confidence of the depositors, one of the
major responsibilities of the board of directors is to appoint an honest, efficient, experienced and suitable Complied
CEO or Managing Director. The Board of directors will appoint a suitable CEO with the approval of the
Bangladesh Bank.
(g) Other responsibilities of the Board
Complied
The board should follow and comply with the responsibilities assigned by Bangladesh Bank.
4.2 Meeting of Board
Board of directors may meet once or more than once in a month if necessary. But Board of directors shall Complied
meet at least once in every three months. Excessive meetings are discouraged.
4.3 Responsibilities of the chairman of the board of directors
a) As the chairman of the board of directors or chairman of any committee formed by the board or any
director does not personally possess the jurisdiction to apply policy making or executive authority, he/
she shall not participate in or interfere into the administrative or operational and routine affairs of the
bank.
b) The chairman may conduct on-site inspection of any bank-branch or financing activities under the
purview of the oversight responsibilities of the board. He may call for any information relating to bank’s
operation or ask for investigation into any such affairs; he may submit such information or investigation Complied
report to the meeting of the board or the executive committee and if deemed necessary, with the
approval of the board, he shall effect necessary action thereon in accordance with the set rules through
the CEO. However, any complaint against the CEO shall have to be apprised to Bangladesh Bank
through the board along with the statement of the CEO.
c) The chairman may be offered an office-room, a personal secretary/assistant, one peon/MLSS, one
telephone at the office, one mobile phone to use inside the country and a vehicle in the business-
interest of the bank subject to the approval of the board.
5. FORMATION OF COMMITTEES FROM THE
BOARD OF DIRECTORS
The adviser, whatever name called, shall advise the board of directors or the CEO on such issues only for
Complied
which he is engaged in terms of the conditions of his appointment. He shall neither have access to the
process of decision-making nor shall have the scope of effecting executive authority in any matters of the
bank including financial, administrative or operational affairs.
5.1 Executive committee
Executive committee should be formed with the members of the board to continue the urgent and daily or
Complied
routine works between the intervals of two board meetings. Executive committee will perform according to
their terms of reference determined by the board of directors.
a) Organizational structure:
i) Members of the committee will be nominated by the board of directors from themselves;
ii) The executive committee will comprise of maximum 07 (seven) members;
Complied
iii) Members may be appointed for a 03 (three)-year term of office;
iv) Chairman of the Board of Directors can be the chairman of executive committee;
v) Company secretary of the bank will be the secretary of the executive committee.

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Compliance
Sl No. Particulars
Status
b) Qualifications of the Members:
i) Integrity, dedication, and opportunity to spare time in the functions of committee will have to be
considered while nominating a director to the committee;
ii) Each member should be capable of making valuable and effective contributions in the functioning
Complied
of the committee;
iii) To perform his or her role effectively each committee member should have adequate understanding
of the detailed responsibilities of the committee membership as well as the bank’s business,
operations and its risks.
c) Roles and Responsibilities of the Executive Committee:
i) The executive committee can decide or can act in those cases as instructed by the Board of directors
that are not specifically assigned on full board through the Bank Company Act, 1991 and other laws
and regulations. Complied
ii) The executive committee can take all necessary decision or can approve cases within power
delegated by the board of directors.
iii) All decisions taken in the executive committee should be ratified in the next board meeting.
d) Meetings
i) The executive committee can sit any time as it may deem fit.
ii) The committee may invite Chief Executive Officer, Head of internal audit or any other Officer to its
meetings, if it deems necessary; Complied
iii) To ensure active participation and contribution by the members, a detailed memorandum should
be distributed to committee members well in advance before each meeting;
iv) All decisions/observations of the committee should be noted in minutes.
5.2 Audit Committee
The board will approve the objectives, strategies and overall business plans of the bank and the audit
committee will assist the board in fulfilling its oversight responsibilities. The committee will review the
Complied
financial reporting process, the system of internal control and management of financial risks, the audit
process, and the bank’s process for monitoring compliance with laws and regulations and its own code of
business conduct.
a) Organizational structure:
i) Members of the committee will be nominated by the board of directors from the directors;
ii) The audit committee will comprise of maximum 05 (five) members, with minimum 2 (two)
independent director; Complied
iii) Audit committee will comprise with directors who are not executive committee members;
iv) Members may be appointed for a 03 (three) year term of office;
v) Company secretary of the bank will be the secretary of the audit committee.
b) Qualifications of the Members:
i) Integrity, dedication, and opportunity to spare time in the functions of committee will have to be
considered while nominating a director to the committee ;
ii) Each member should be capable of making valuable and effective contributions in the functioning
of the committee;
iii) To perform his or her role effectively each committee member should have adequate understanding Complied
of the detailed responsibilities of the committee membership as well as the bank’s business,
operations and its risks.
iv) Professionally Experienced persons in banking/financial institutions specially having educational
qualification in Finance, Banking, Management, Economics, Accounting will get preference in
forming the committee.

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Compliance
Sl No. Particulars
Status
c) Roles and Responsibilities of the Audit Committee
(i) Internal Control:
1. Evaluate whether management is setting the appropriate compliance culture by communicating the
importance of internal control and the management of risk and ensuring that all employees have
clear understanding of their roles and responsibilities;
2. Review management’s actions in building computerization of the bank and its applications and
bank’s Management Information System (MIS);
Complied
3. Consider whether internal control strategies recommended by internal and external auditors have
been implemented by the management;
4. Consider reports relating to fraud, forgery, deficiencies in internal control or other similar issues
detected by internal and external auditors and inspectors of the regulatory authority and place it
before the board after reviewing whether necessary corrective measures have been taken by the
management.
(ii) Financial Reporting:
1. Audit committee will check whether the financial statements reflect the complete and concrete
information and determine whether the statements are prepared according to existing rules &
regulations and standards enforced in the country and as per relevant prescribed accounting Complied
standards set by Bangladesh Bank;
2. Discuss with management and the external auditors to review the financial statements before its
finalization.
(iii) Internal Audit:
1. Audit committee will monitor whether internal audit working independently from the management.
2. Review the activities of the internal audit and the organizational structure and ensure that no
unjustified restriction or limitation hinders the internal audit process; Complied
3. Examine the efficiency and effectiveness of internal audit function;
4. Examine whether the findings and recommendations made by the internal auditors are duly
considered by the management or not.
(iv) External Audit:
1. Review the performance of the external auditors and their audit reports;
2. Examine whether the findings and recommendations made by the external auditors are duly considered Complied
by the management or not.
3. Make recommendations to the board regarding the appointment of the external auditors.
(v) Compliance with existing laws and Regulations:
Review whether the laws and regulations framed by the regulatory authorities (central bank and other Complied
bodies) and internal regulations approved by the board are being complied with.
(vi) Other Responsibilities:
1. Submit compliance report to the board on quarterly basis on regularization of the omission, fraud
and forgeries and other irregularities detected by the internal and external auditors and inspectors of
regulatory authorities; Complied
2. External and internal auditors will submit their related assessment report, if the committee solicit;
3. Perform other oversight functions as desired by the Board of Directors and evaluate the committee’s
own performance on a regular basis.

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Compliance
Sl No. Particulars
Status
d) Meetings
1. The audit committee should hold at least 4 meetings in a year and it can sit any time as it may
deems fit;
2. The committee may invite Chief Executive Officer, Head of internal audit or any other Officer to its
Complied
meetings, if it deems necessary;
3. To ensure active participation and contribution by the members, a detailed memorandum should
be distributed to committee members well in advance before each meeting;
4. All decisions/observations of the committee should be noted in minutes.
5.3 Risk Management Committee
To play an effective role in mitigating impending risks arising out from strategies and policies formulated
by the Board and to carry out the responsibilities efficiently, a risk management committee will be formed.
After identifying and assessing several risk factors like credit risks, foreign exchange risks, internal control
Complied
and compliance risks, money laundering risks, information and communication risks, management risks,
interest risks, liquidity risks etc.; the risk management committee will scrutinize whether appropriate risk
management measures are being put in place and applied and whether adequate capital and provision is
being maintained against the risks identified.
a) Organizational Structure
1. Members of the committee will be nominated by the board of directors from themselves;
2. The Risk Management Committee will comprise of maximum 05 (five) members; Complied
3. Members may be appointed for a 03 (three) year term of office;
4. Company secretary of the bank will be the secretary of the Risk Management Committee.
b) Qualifications of the Members
1. Integrity, dedication, and opportunity to spare time in the functions of committee will have to be
considered while nominating a director to the committee;
2. Each member should be capable of making valuable and effective contributions in the functioning
of the committee; Complied

3. To perform his or her role effectively each committee member should have adequate understanding
of the detailed responsibilities of the committee membership as well as the bank’s business,
operations and its risks.
c) Roles and Responsibilities of the Risk Management Committee
i) Risk identification & control policy :
Formulation and implementation of appropriate strategies for risk assessment and its control is the
responsibility of Risk Management Committee. Risk Management Committee will monitor risk management Complied
policies & methods and amend it if necessary. The committee will review the risk management process to
ensure effective prevention and control measures.
ii) Construction of organizational structure:
The responsibility of Risk Management Committee is to ensure an adequate organizational structure for
managing risk within the bank. The Risk Management Committee will supervise formation of separate
Complied
management level committees and monitor their activities for the compliance of instructions of lending
risk, foreign exchange transaction risk, internal control & compliance risk, money laundering risk,
information & communication risk including other risk related guidelines.
iii) Analysis and approval of Risk Management policy:
Risk management policies & guidelines of the bank should be reviewed annually by the committee. The
committee will propose amendments if necessary and send it to the Board of Directors for their approval. Complied
Besides, other limits including lending limit should be reviewed at least once annually and should be
amended, if necessary.

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Compliance
Sl No. Particulars
Status
iv) Storage of data & Reporting system:
Adequate record keeping & reporting system developed by the bank management will be approved by
Complied
the risk management committee. The committee will ensure proper use of the system. The committee will
minute its proposal, suggestions & summary in a specific format & inform the Board of Directors.
v) Monitoring the implementation of overall Risk Management Policy:
Risk Management Committee will monitor proper implementation of overall risk management policies.
Complied
They will monitor whether proper steps have been taken to mitigate all risks including lending risk, market
risk, and management risk.
vi) Other responsibilities:
1. Committee’s decision and suggestions should be submitted to the Board of Directors quarterly in
short form;
Complied
2. Comply instructions issued time to time by the controlling body;
3. Internal & external auditor will submit respective evaluation report whenever required by the
committee.
d) Meetings
1. The risk management committee should hold at least 4 meetings in a year and it can sit any time as
it may deems fit;
2. The committee may invite Chief Executive Officer, Chief Risk Officer and any other Officer to its
Complied
meetings, if it deems necessary;
3. To ensure active participation and contribution by the members, a detailed memorandum should
be distributed to committee members well in advance before each meeting;
4. All decisions/observations of the committee should be noted in minutes.
6 TRAINING FOR THE DIRECTORS
The directors shall make themselves fully aware of the banking laws and other related rules and regulations Complied
for performing his duties properly.
Status of Compliance of Bangladesh Bank’s guidelines for Corporate Governance (BRPD circular no. 18 dated 27.10.2013)
A. Rules and regulations for appointing CEO
1. Moral Integrity: In case of appointment to the post of Chief Executive, satisfaction in respect of the
concerned person should be ensured to the effects that,-

a) He has not been convicted by any Criminal Court of Law; Complied

b) He has not been punished for violating any rules, regulations or procedures/norms set by any
Controlling Authority;
c) He was not associated with any such company/organization, registration or license of which has been
cancelled.
2. Experience and Suitability:
a) For appointment as chief executive, the concerned person must have experience in banking profession
for at least 15 (fifteen) years as an active officer and at least 02 (two) years experience in a post
immediate below the chief executive of a bank.
b) He must at least have a Masters degree from any recognized university. Higher academic education in
the field of Economics, Banking and Finance or Business Administration will be treated as additional
Complied
qualification for the concerned person.
c) In respect of service, the concerned person should have excellent record of performance.
d) Satisfaction should be ensured that the concerned person was not dismissed from service when he was
chairman/director/official of any company;
e) Any director of any bank or financial institution or any person who has business interest in the bank
concerned will not be eligible for appointment to the post of chief executive.

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Status
3. Transparency and Financial Integrity: Before appointment as chief executive, satisfaction should be ensured
to the effects that:
a) The concerned person was not involved in any illegal activity while performing duties in his own or
banking profession; Complied
b) He has not suspended payment to creditors or has not compromised with his creditors to be relieved
from debt or he is not a loan defaulter;
c) He is not a tax defaulter;
d) He has never been adjudicated an insolvent.
4. Age limit: No person crossing the age of 65 years shall hold the post of CEO of a bank. Complied
5. Tenure: The tenure of the chief executive shall be for at least 03 (three) years, which is renewable. If the
Complied
candidate has less than 3 years left to attain 65 years, he/she can be appointed for that period.
6. Guidelines in fixing the salary and allowances: Banks are required to follow the guidelines stated below
while determining the salary and allowances of the CEO and submitting such proposal to Bangladesh
Bank:-
a) In fixing the salary and allowances of the chief executive, financial condition, scope of operation,
business-volume and earning capacity of the bank; qualifications, achievement of the candidate in the
past, age and experience and the remuneration paid to the persons occupying same position in the
peer banks shall have to be taken into consideration.
b) Total salary shall be comprised of direct salary covering ‘Basic Pay’ and ‘House Rent’ and allowances as
‘Others’. The allowances (e.g., provident fund, utility bill, leave-fare assistance) in ‘Others’ head should
be specified in amount/ceiling. Besides, other facilities (e.g., car, fuel, driver etc.), as far as possible,
shall have to be monetized and thus determining monthly total salary, it shall have to be mentioned
in the proposal to be submitted to Bangladesh Bank. In the proposal, Basic Pay, House Rent, Festival Complied
Allowance, other allowances and other facilities shall have to be specified in Taka amount.
c) Without improving the bank’s major economic indicator like- CAMELS annual salary increment will not
be payable.
d) Terms of salary-allowances and other facilities as specified in the terms and conditions of appointment
cannot be changed during the tenure. In case of renewal, proposal may be made for re-fixation of the
salary considering the job performance of the incumbent chief executive.
e) The Chief Executive so appointed shall not get any other direct or indirect facilities (e.g., dividend,
commission, club expense, etc.) other than the salary-allowances and other facilities as enumerated in
clause (b) above.
f) The bank shall not pay any income tax for the chief executive, i.e., the chief executive so appointed shall
have to pay it.
7. Incentive Bonus: Subject to the payment of incentive bonuses to all stuffs/employees, the CEO will be
eligible to get such bonus. However, the amount of CEO’s incentive bonus will not cross Taka 10.00 (ten) Complied
lacs per year.
8. Honorarium for Board Meeting: As CEO is a salaried official of the bank, he will not get any honorarium for
Complied
attending the Board meeting or the meeting of any Committee formed by the Board.
9. Evaluation Report: While reappointing CEO, an evaluation report approved by the board of directors should
Complied
be submitted to Bangladesh Bank by the chairman of the Board.
10. Prior approval from Bangladesh Bank: Prior approval from Bangladesh Bank is mandatory before
appointing CEO as per section 15(4) & (5) of the Bank Company Act 1991 (Amended upto 2013). For
processing such approval, along with the proposal signed by the chairman of the board, the selected
Complied
person’s complete resume, offer letter (mentioning the direct & indirect remuneration and facilities) and
copy of board’s approval must be submitted to Bangladesh Bank. The selected person must also submit
declarations as per Annexure-ka & Annexure-kha to Bangladesh Bank.

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Status
11. Decision of Bangladesh Bank regarding appointment of CEO will be treated as final and such appointed
CEO cannot be dismissed, released and removed from his office without prior approval from Bangladesh Complied
Bank.
B. Responsibilities and authorities of the CEO
The CEO of the bank, whatever name called, shall discharge the responsibilities and affect the authorities
as follows:
a) In terms of the financial, business and administrative authorities vested upon him by the board, the
CEO shall discharge his own responsibilities. He shall remain accountable for achievement of financial
and other business targets by means of business plan, efficient implementation thereof and prudent
administrative and financial management.
b) The CEO shall ensure compliance of the Bank Company Act, 1991 and other relevant laws and
regulations in discharging routine functions of the bank.
c) At the time of presenting any memorandum in the Board Meeting or Board Committee Meeting, the CEO
must point out if there is any deviation from the Bank Company Act, 1991 and other relevant laws and Complied
regulations.
d) The CEO shall report to Bangladesh Bank any violation of the Bank Company Act, 1991 or of other laws/
regulations.
e) The recruitment and promotion of all staff of the bank except those in the two tiers below him shall rest
on the CEO. He shall act in such cases in accordance with the approved service rules on the basis of the
human resources policy and sanctioned strength of employees as approved by the board.
f) The authority relating to transfer of and disciplinary measures against the staff, except those at two tiers
below the CEO, shall rest on him, which he shall apply in accordance with the approved service rules.
Besides, under the purview of the human resources policy as approved by the board, he shall nominate
officers for training etc.
Status of Compliance of Bangladesh Bank’s guidelines for Corporate Governance (BRPD circular no. 19 dated 27.10.2013)
A Appointment of Advisor
1. Experience and Suitability: For appointment as advisor, the concerned person will have to fulfill the
following requirements with regard to experience and qualifications:
a) Experience in Banking or Administration for at least 15 (fifteen) years or have a long experience in social
activities;
b) Higher academic education in the field of Economics, Banking and Finance or Business Administration
will be treated as additional qualification for the concerned person; N/A
c) Satisfaction should be ensured that the concerned person was not dismissed from his service when he
was Chairman/Director/Official of any company;
d) A person who is working in any bank or financial institution or who has business interest in that bank
will not be considered eligible for appointment to the post of advisor;
e) Satisfaction should be ensured that the concerned person is not a loan defaulter or tax defaulter and
has never been adjudicated an insolvent by the court.
2. Responsibilities: The responsibilities or terms of reference of advisor should be specified. The Advisor
can advise the Board of Directors or the Chief Executive only on those matters that are specified in the
appointment letter. Routine works or general works will not be included in his term of reference. He can’t N/A
exercise any kind of power or can’t participate in the decision making process of financial, administrative,
operational or any other activities of the bank.

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Corporate
Governance

Compliance
Sl No. Particulars
Status
3. Prior approval from Bangladesh Bank: Prior approval from Bangladesh Bank is mandatory before
appointing advisor. For such appointment, the justifications of the post of advisor, responsibilities or terms
of reference, complete resume of the concerned person, terms of appointment (mentioning remuneration
N/A
and facilities) and copy of board’s approval must be submitted to Bangladesh Bank. The nominated person
has to make a declaration as per Annexure-ka. This declaration must be also submitted to Bangladesh
Bank.
4. Remuneration and other facilities: The post of advisor is not a fixed or substantive post in the bank’s
organization structure. Advisor will not be entitled to salaries and allowances as regular employee except
N/A
gross amount of remuneration, transport and telephone facilities. Remunerations inconsistent with terms
of reference of the advisor will not be considered as acceptable by Bangladesh Bank.
5. Tenure: The tenure of the advisor shall be maximum 1(one) year, which is renewable. An evaluation report
(by the chairman that is approved by the board of directors) of previous tenure should be submitted to N/A
Bangladesh Bank along with the re-appointment proposal.
6. Appointment of Ex-officials: For good governance any former director, chief executive or any official will not
be eligible to become an advisor in the same bank immediately after his/her retirement or resignation. But, N/A
after 1 year from such retirement or resignation he/she will be eligible for appointment as advisor.
B Appointment of Consultant
1. Terms of Reference: Consultant can be appointed for specialized tasks like tax, law & legal procedures,
engineering & technical works, information technology, etc. Consultants’ appointment should be avoided N/A
as much as possible for those works that could be done by regular employees of the bank.
2. Responsibilities: The responsibilities or term of reference of consultant should be specified. He/she
shouldn’t be involved beyond his/her terms of references and he/she cannot exercise any kind of power in N/A
bank operation or cannot participate in the decision making process.
3. Appointment: Consultant can be appointed with the approval of Board of Directors. After such appointment
the bank shall send the consultant’s complete resume, terms of reference and details of remuneration to N/A
Bangladesh Bank immediately.
4. Tenure: The tenure of consultant should be consistent with the terms of reference, but would not exceed 2
(two) years. Generally, consultant’s appointment will not be renewable, but to complete unfinished tasks,
the contract can be extended up to maximum 1 year with the approval of Bangladesh Bank. An evaluation N/A
report (by the chairman that is approved by the board of directors) of previous period should be submitted
to Bangladesh Bank.
5. Remuneration/honorarium: The consultant’s remuneration should be in the form of monthly or single
N/A
lump-sum payment, he is not entitled to any other facilities.
6. Appointment of Ex-officials: For ensuring good governance any former director, chief executive or any
official will not be eligible to become a consultant in the same bank immediately after his/her retirement or
N/A
resignation. But, after 1 year from such retirement or resignation he/she will be eligible for appointment as
consultant.

Annual Integrated Report 2017

243
 Bank Asia
Shariah Supervisory Committee

We, at Bank Asia Limited, always consider the Shariah compliance as the most significant
and strategic priority in Islamic Banking. Our products & services are designed in
conformity with the principles of Islamic Shariah. We have constituted “Bank Asia Shariah
Supervisory Committee” consisting of qualified Faqihs (experts on Islamic
jurisprudence), Islamic Scholars and professionals to ensure Shariah compliance in each
and every aspect of our Islamic Banking operations.

Bank Asia Shariah Supervisory Committee consists of the following members:

Name Position in the Committee

M. Azizul Huq Chairman
Mufti Abdul Mannan Member
Mohammad Mofazzal Hussain Khan Member
Dr. Md. Gazi Zahirul Islam Member
Shah Mohammad Wali Ullah Member
Dr. Muhammad Ismail Hussain Member
Rumee A Hossain Member
Member [Ex-Officio]
Md. Arfan Ali
(President & Managing Director)
Member [Ex-Officio]
A.K.M. Mizanur Rahman
(Head of Islamic Banking CC)

Bank Asia Shariah Supervisory Committee meeting

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244
Report of Bank Asia Shariah
Supervisory Committee (BASSC)
For the year 2017

Throughout the year, Bank Asia Shariah 2017, the Committee, has expressed the
Supervisory Committee (BASSC) reviewed following opinion:
and evaluated different issues of Islamic 1. Profit has been distributed to
Banking operations of the Bank. The Mudaraba Depositors on the basis of
Committee also extended its direction, pre-declared Income Sharing Ratio
opinion & verdict on Shariah compliance (ISR) in accordance with Shariah.
issues. It is worth mentioning here that 2. Compensation amount has been kept
to ensure compliance to Shariah rules separate and not included in Bank’s
the role of the BASSC is to provide income.
with necessary guidance & opinion 3. Transactions with conventional part of
independently on an ongoing basis. On the the Bank have been made compliant
other hand, the responsibility of the Bank’s with Shariah principle and recorded
Board and Management, is to ensure that separately.
their business operations under Islamic 4. According to Shariah inspection
Banking have adhered to and run in reports, in investment operations, no
accordance with guidance of the BASSC. violation of basic principles of Shariah
To reach and deliver maximum possible has been identified. No doubtful
level of Shariah compliance, the BASSC transaction detected in the light of
approved the following steps taken in the Islamic Shariah.
year 2017: 5. As per direction of Chapter 8 of
1. Conducting Shariah audit & ‘Guidelines on Internal Control &
inspection in all Islamic Banking Compliance in Banks’ issued by
Windows on quarterly basis. Bangladesh Bank titled ‘Shariah Audit’,
2. Continuing the practice of obtaining operations of all of 5 Islamic Banking
‘Shariah Clearance’ from Shariah Unit Windows of Bank Asia rated as ‘low’
of Corporate Office before disbursing in Shariah risk; i.e. highly Shariah
every deal of Bai Murabaha Muajjal complied, the committee expressed
investment, with a view to confirming full satisfaction in this regard.
real buying & selling. This practice was Alhamdulillah! The committee opined
appreciated by the Committee as such that the commitment & endeavours of the
pre-disbursement culture is the 1st of officials of Islamic Banking team of Bank
its kind in the Islamic Banking history Asia, to maintain Shariah compliance
of Bangladesh. The Committee also is appreciable. To attain higher level of
termed this practice as exemplary for professional excellence and increase
other Islamic Banking operators. awareness of the clients on Shariah
3. Organizing four (4) training and compliance in banking, the committee
workshops to enrich knowledge base advised the Management to arrange
& skill level of the Islamic Banking knowledge sharing programs on regular
officials on Shariah compliance. basis.
4. Visiting 53 conventional branches May Allah give us tawfeeq in attaining His
of the Bank to motivate respective satisfaction through implementation of
officials and build awareness of Shariah in every sphere of our life. Ameen.
Islamic Banking principle, products &
services.
5. Some Investment products as well as
Deposit prodict approved including
policies in view of Islamic Shariah.
After reviewing and evaluating the Shariah M. Azizul Huq
Inspection Reports, Balance Sheet and Chairman
Profit & Loss statement (Unaudited) of Bank Asia Shariah Supervisory Committee
Islamic Banking of the Bank for the year (BASSC)

Annual Integrated Report 2017

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 Chief Financial
Officer’s Report

Political stability coupled Sustained political stability, relatively consistent inflation rate, amplified research and
with moderate inflation innovation in different sectors of the economy in recent years have seen private sector
businesses grow considerably with opening up of scopes for investors to have confidence
has relatively gained
for an exalted economy. Oppositely, rising non-performing loans followed by stagnancy
investors’ confidence in loan recovery, pressure on bank liquidity to expand business and comply regulations,
in the recent economic maintaining spread from the core business, upward trend of US$ rate ensuing higher
progression, on the import costs as well as widening trade deficit marking diminution of foreign reserve, flow
other hand sudden of lower remittance due to foreign governmental embargo on jobs and political strife
liquidity crunch followed pose significant challenges to the robustness of the banking industry. Fortunately, the
adoption of technology driven financial inclusion program such as agent banking, mobile
by rising NPL and lower
banking, government undertaking new projects including development of LPG terminal
remittance flow put and addition of electricity to national grid unveil a greater window for expanding financial
challenging environment inclusion than ever and pave the way for sustainable economic and social development.
for banks to operate;
Bank Asia marked its yearend with classified loan gliding down to 4.38%, ROE of 10.21%
fortunately technology and a total contribution of Tk 4,408 million to National exchequer denoting 1.35% growth
driven financial inclusion than 2016.
programs like agent
The scenario mentioned above influenced Bank Asia’s business strategies in the following
banking, EBEK, social
ways:
safety net, mobile
banking offers some OPTIMIZING REVENUE
degree of relief. One of the major ways to optimize revenue from the core business is to have efficient
mixing of liability products and making the best use of funds by diversifying loan
products with competitive benefits, pricing to escalate the market share pie. Accordingly,
Bank Asia ALCO continuously adjusts the deposit and loan products pricing with market
dynamics movement in the banking industry to maximize income. It is noteworthy that
Bank Asia has marked significant improvement in its deposit mix by driving high cost
deposit to 50% in 2017 from 53% in 2016 that resulted cost of deposit to improve to
5.08% in 2017 from that of 5.66% in 2016.
BUDGETING
A budget is one of the guiding tools where the Board expectations and Management
aptitudes are blended to produce some goals to strive for. In the process of preparing

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Chief Financial
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a budget, a balanced assortment is taken that consists of top down and bottom up A balance need to exist between business
approach taking into account industry scenario, commanding area potentials, intrinsic expansions and associated risk mitigation
and extrinsic factors, capacity of the branches and human resources etc. All these factors for efficient capital management. It is to be
play a pivotal role in shaping up a pragmatic budget which gets reviewed on monthly mentioned that the Basel III capital accord
basis and strategies are being realigned to get close to the target. implementation has already begun since
January 2015 and will see completion
The budget and achievement summary is shown below by January 2020 as per the Bangladesh
Million Taka bank roadmap. The accord will be fully
Growth 2017 Target implemented by January 2020, where
2017 the Minimum Total Capital plus Capital
Particular 2017 2016 Achieve-
(%) Target Conservation Buffer will be 12.50% against
ment (%)
existing 10% depicted as follows:
Loans and advances 197,504 163,610 20.72% 200,310 98.60%
Deposits 207,041 191,273 8.24% 224,811 92.10% 2016 2017 2018 2019
Import 181,468 148,724 22.02% 173,600 104.53% 10.625% 11.25% 11.875% 12.50%
Export 118,172 103,139 14.58% 120,419 98.13%
A strong capital base is the mainstay
Remittances (inward) 51,778 41,665 24.27% 44,533 116.27% for healthy growth but equity capital
Operating profit 6,688 5,921 12.95% 7,026 95.19% is the most expensive source of fund
Operating expenses 5,280 4,719 11.89% 5,200 101.54% which needs to be check mated with
cheaper alternative sources and with
Shareholder’s equity 21,054 19,038 10.59% - -
this in retrospect, Bank Asia injected TK.
Capital fund 32,914 24,775 32.85% - - 1,050 million to the core capital in 2011
by issuing Rights share accompanied
FORECASTING BUSINESS AND REALIGNING STRATEGIES
by raising of Tier-2 capital in the form
We prepare budget and five year strategic business plans annually to set our midterm
of 6 Year - 13% Yield to Maturity, Non-
and long term vision. Since banking business is highly sensitive due to default risk,
convertible Subordinated Zero Coupon
interest rate risk, market risk etc. monthly rolling forecast on expected business as well Bond for Tk. 600 million. Continuing
as outcome paves the way for necessary adjustment with the required action plan the stride, Bank Asia further injected
formulation and implementation. Tk. 3,000 million 7 Year Non-convertible
OPERATING COST AND BURDEN COVERAGE Subordinated Bond on 2015 followed by
We put our best effort to optimize the fixed and variable expenses in such a fashion that issuance of another subordinated Bond
the business grows smoothly ensuing in shareholder’s wealth enhancement. During 2017, of 7 Year Floating Rate Non-convertible
the operating expense grew only by 11.88% as a result of opening up 9 new branches, Subordinated Bond of Tk. 5,000 million
installing 13 new ATM booths and adding 117 employees to the portfolio etc. The burden through private placement in 2017. The
ratio of 0.44% indicates the Bank’s strength to bear its expense from non-interest income vision of raising CET1 capital by 2018 as a
thus exhibiting lesser dependence on loans’ interest income. long term capital solution is plausible due
to the dedicated endeavor put by both the
Board and the Management.
TAX/VAT MANAGEMENT Apart from raising core capital and
Tax and Vat Planning is posited at the supplementary capital, Bank Asia
Operating Profit pinnacle of our concern as a little drift relegates equivalent emphasis on
Profit After Tax may consume a major portion of the net capital saving or reduction of capital
profit. Bank Asia maintains a strong team requirement in the form of credit rating
6,688

to efficiently finalize the tax assessment of appropriate Corporate and SME clients
6,006

5,921
5,779
5,416

on annual basis and manage the VAT (detailed out in risk management report
authority, NBR, CIC and Auditor General section), optimizing worthy collaterals
(AG) commendably. and diversifying the business portfolio to
2,574

2,048

ensure minimal risk with the maximum

2,219
1,456

1,546

CAPITAL MANAGEMENT gain in return. Keeping this in mind, Bank

AND PLANNING Asia always formulates its capital and
In order to make the banking sector more business strategies based upon a 5 year
resilient the Basel Committee on Banking encompassing capital planning.
2013 2014 2015 2016 2017
Supervision (BCBS) released a global
regulatory framework on Basel-III capital
accord in December 2010 by refurbishing
the global capital and liquidity rules.

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 Chief Financial
Officer’s Report

Capital Plan (Banking Operation) 2017-2021

Million Taka

Particulars 2017 2018 2019 2020 2021

Common Equity Tier 1 (CET1) Capital

Paid-up capital 9,870 10,660 11,726 12,898 14,188

Statutory Reserve 7,345 8,530 9,894 11,475 13,295

General Reserve 8 8 8 8 8
Retained earnings 1,677 2,493 2,776 3,221 3,968
Less: Regulatory adjustments (47) (47) (47) (47) (47)
Total CET1 18,853 21,643 24,357 27,556 31,412
Tier 2 Capital
General Provision 5,432 6,286 7,416 8,661 10,011

Revaluation Reserve 537 268 0 0 0

Subordinated 6 year Zero Coupon Bond 93 0 0 0 0

Subordinated 7 year Floating Rate Bond2 3,000 2,400 1,800 1,200 600

Subordinated 7 year Floating Rate Second Bond3 5,000 5,000 5,000 4,000 3,000
Subordinated 7 year Floating Rate Second Bond4
0 5,000 5,000 5,000 4,000
(Proposed)
Total Tier 2 Capital 14,061 18,954 19,216 18,861 17,611

Total Capital (Tier 1 + 2) 32,914 40,597 43,573 46,417 49,023

Risk Weighted Assets (RWA) 221,115 263,150 305,710 350,510 372,703

Minimum Capital Requirement + Buffer 11.25% 11.88% 12.50% 12.50% 12.50%

Capital to Risk Weighted Assets Ratio (CRAR) 14.89% 15.43% 14.25% 13.24% 13.15%

Regulatory Adjustments
14.89%

* Reciprocal crossholdings in the CET1Capital of Bank Asia by other banks and financial
institutions have been deducted.
12.46%

12.42%
11.32%

** 100% of revaluation reserve for fixed assets, securities and equity securities will be adjusted
11.05%

from regulatory capital by 2019. So long 50% of such revaluation reserve were eligible for Tier 2
capital.

INVESTMENT
In order to ensure as much as fixed income for sustainable growth of the
company as well as to comply with the regulations, the Bank invested in Govt. Capital Fund
Trend
treasury bill, bond, quoted shares, Pre-IPO placement investment (unquoted (Million Taka)
32,914
15,575

17,843

22,837

24,775

shares), preference shares, mutual funds, different subordinated bonds, other

corporate bonds and equity participation etc. In 2017, the total investment of Capital Fund
the bank stood at Tk. 27,545.81 million. CRAR
2013 2014 2015 2016 2017

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Chief Financial
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Key Performance Indicators (KPIs) of Banking Operation

Million Taka

Particular 2017 2016

Operating performance (statement of comprehensive income)
Total operating income 11,967 10,640
Operating profit 6,688 5,921
Profit before tax 4,058 3,287
Profit after tax 2,048 1,546
EPS 2.07 1.57
Statement of financial position (balance sheet)
Shareholders fund 21,054 19,038
Property, plant & equipment 5,330 5,250
Current asset 159,832 147,293
Current liability 151,962 141,017
Net current asset 7,870 6,276
Long term liability 115,980 93,140
Long term liability to current liability 76.32% 66.05%
Key performance ratios (%)
Yield on advances 9.03 9.86
Cost of deposits 5.08 5.66
Cost of deposits and borrowing 5.23 5.71
Cost of fund 7.73 8.22
Cost of operation 2.5 2.51
Spread 3.95 4.2
Net interest margin 3.63 3.64
Burden ratio 0.43 0.4
20%

DIVIDEND Dividend
(Million Taka)
We know that dividend is paid out either in cash or in stock. Issuing stock dividend helps
Dividend Ammount
bank to raise core capital and after getting desired capital it becomes obvious to issue
Dividend %
12.50%

cash dividend to keep up shareholders confidence in the company as well as maintain

consistency in pay-out ratio. Accordingly, the bank issued stock dividend in the earlier
15%

12%

years of its operation and in 2014 and 2015 it issued a combination of both cash and stock
dividend. Again in 2016 stock dividend was given. For 2017 the Board of Directors has
proposed 12.50% stock dividend amounting to Tk. 1,234 million. The following table shows
dividend pay-out from 2008 to 2017:
10%

Year 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
20%
15% (5%C 12.50%S
Dividend 23%S 40%S 40%S 20%S 10%S 10%S (15%C + 12%S
+ 10%S) (Proposed)
1,144

1,679

1,058

1,234

5%S)
694

Million
401 858 1,201 1,051 631 694 1,144 1,679 1,058 1,234
(Taka)
2013 2014 2015 2016 2017

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 Chief Financial
Officer’s Report

KEY PERFORMANCE TARGETS AND ACHIEVEMENTS

The prudent and capable management of the Bank as well as the motivated employees are putting their concerted efforts that are
reflected over the key performance indicators. Below comparative analysis shows the bank’s operational efficacy through its drive for
efficient cost management, effective risk management and value generation for the shareholders.

Profit 6. EPS
1. Maximize Revenue After Tax
Target: Maintain balanced growth Target: Maintain the Earning Per
2,048 moderate growth rate of EPS Share
1,546
Outcome: 32% growth in Profit after to cater maximum return to 2.07
Tax signifies efficient balance sheet the shareholders. 1.57
management
2016 2017 Outcome: 32.44% growth
registered in the EPS due
to higher profit earning and
2016 2017
rigorous cost management
2. Controlling Expenses
Target: Enhancing scopes for investment and Cost to
Income Ratio
growth by employing cost effective measures
and driving cost to income ratio below 40%. 44.35% 44.12%
Staff Strength
Outcome: Improving the cost to income Staff summary as of 31st December 2017
ratio by 0.23% marking sound strategic cost Age Group Male Female Total
management efforts. Savings reinvested in
headcount and new capabilities including 2016 2017 30 & below 388 123 511
digital initiatives 31-40 871 330 1,201
41-50 298 40 338
51-60 34 3 37
3. Capital Management Total 1,591 496 2,087
CRAR %
Target: Keeping CRAR @14% which is well 14.89% Percentage 76% 24% 100%
above the present regulatory requirements
including buffer and adequate for future 12.42%
contingencies.
Outcome: Increased capital through bond
issuance, rated corporate clients and kept 2016 2017
CRAR @14.89%.
Staff
Strength
Executives
NPL to Total Officers
Loan
4. Curbing NPL 5.41%
Target: Bring down the NPL to below 2% and
1,717

sustain the efficacy of loan recovery as well 4.38%

1,604

as eliminate implausible financing sources.

1,518
1,479

Outcome: Brought down NPL to total

1,350

loan ratio to 4.38% from 5.41% marking a

progress by 1.03% from last year
2016 2017

Return on
Equity
370
250

294

321

366

5. Improving Returns 10.21%

Target: ROE 12% or better in a normalized
8.13%
interest rate environment 2013 2014 2015 2016 2017
Outcome: ROE rises to 10.21% from 8.13%
in a challenging operating environment.

2016 2017
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 Chief Financial
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Human Resource Accounting

Human resource accounting helps the company ascertain how much investment is made on its employee and how much return it can
expect from this Investment. Bank Asia reported the total value of human capital to be Tk. 16,896 million in the year 2017 compared
to Tk. 16,772 million in 2016 The detailed discussion on Bank’s HR Accounting has been presented at Page no 212-213 of this Annual
Intregated Report.

Category wise Break down is presented in the table below

Million Taka
2017 2016
Category Per Capita No. of Per Capita Total
No. of Employees Total Value
Value Employees Value Value
Executives 370 16.11 5,961 358 16.39 5,868
Officer 1,717 6.37 10,935 1612 6.76 10,905
Total 2,087 16,896 1,970 16,772

Brief Economic, Environmental and Social Performance

Clarity and Integrity in reporting have always been the
No of loans accounts +25%
Economic essence of Group Finance of Bank Asia through which
responsibility
Deposit customer accounts +24% we try to assist in shaping the Business Strategy of the
Savings customer accounts +34% Management and the Board. We motivate ourselves with
the devotion to ensure Safe, Secure and Stable Banking
Profit after Tax 2,048 million BDT with Bank Asia and it is expected that the year 2018 will
Shareholders
responsibility
Shareholders’ fund 21,054 million BDT be astounding in terms of value creation and financial risk
management.
Share Price 23.10 BDT
Electricity consumed 95,34,000 kwh
Oil 80,337 ltrs
Environmental
responsibility
CNG 204,286 m3
Local business travel 88,62,500 km
Paper used 81,811 reams
Social Staff strength +6%
responsibility Mohammad Ibrahim Khalil, FCA
Benefits and emoluments +8%
Chief Financial Officer

Annual Integrated Report 2017

251
 Bank Asia Limited
252
Annual Integrated Report 2017
253
 Independent Auditor’s Report
to the Shareholders of Bank Asia Limited
Report on the Financial Statements
We have audited the accompanying consolidated financial statements of Bank Asia Limited and its subsidiaries (together referred to as “GROUP”)
as well as separate financial statements of Bank Asia limited (“The Bank”) which comprise the consolidated and separate balance sheet as at 31
December 2017, consolidated and separate Profit and loss accounts, consolidated and separate statement of changes in equity and consolidated
and separate statement of cash flows for the year then ended and a summary of significant accounting policies and other explanatory
information.

Management’s Responsibility for the Financial Statements

Management of Bank Asia Limited is responsible for the preparation and fair presentation of these consolidated financial statements of the group
and also separate financial statements of the Bank that give a true and fair view in accordance with Bangladesh Financial Reporting Standards
(BFRS), as explained in Note 2 and for such internal control as management determines is necessary to enable the preparation of consolidated
financial statements of the Group and also separate financial statements of the Bank that are free from material misstatement, whether due to
fraud and error. The Bank Companies Act 1991 (as amended on 2018), and the Bangladesh Bank Regulations require the Management to ensure
effective internal audit, internal control and risk management functions of the Bank. The Management is also required to make a self-assessment
on the effectiveness of anti-fraud internal controls and report to Bangladesh Bank on instances of fraud and forgeries.

Auditor’s Responsibility

Our responsibility is to express an opinion on these consolidated financial statements of the group and also separate financial statements of the
Bank based on our audit. We conducted our audit in accordance with Bangladesh Standards on Auditing (BSA). Those standards require that we
comply with ethical requirements and plan and perform the audit to obtain reasonable, but not absolute assurance whether the consolidated
financial statements of the group and also separate financial statements of the Bank are free from material misstatement due to fraud and error.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements
of the group and also separate financial statements of the Bank. The procedures selected depend on the auditor’s judgment including the
assessment of the risks of material misstatement of the consolidated financial statements of the group and also separate financial statements
of the Bank, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s
preparation and fair presentation of the consolidated financial statements of the group and also separate financial statements of the Bank not for
the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of
accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation
of the consolidated financial statements of the group and also separate financial statements of the Bank.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the consolidated financial statements of the group and also separate financial statements of the Bank give a true and fair view of
the consolidated financial position of the group and the separate financial position of the Bank as at 31 December 2017, and of its consolidated
and separate financial performance and its consolidated and separate cash flows for the year then ended prepared in accordance with
Bangladesh Financial Reporting Standards (BFRS) as explained in Note # 2.

Report on Other Legal and Regulatory Requirements

In accordance with the Companies Act 1994, the Bangladesh Securities and Exchange Rules 1987, the Bank Company Act 1991 as amended in
2018 and the rules & Regulations issues by Bangladesh Bank, we also report the following:

a) We have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of
our audit and made due verification thereof;

b) To the extent noted during the course of our audit work performed on the basis stated under the Auditor’s Responsibility section in forming
above opinion on the consolidated financial statements of the Group and the separate financial statements of the Bank and considering
the reports of the Management to Bangladesh Bank on anti-fraud internal controls and instances of fraud and forgeries as stated under the
Management’s Responsibility for the Financial Statements and Internal Control:

• Internal audit, internal control and risk management arrangements of the Group and the Bank as disclosed in Note # 2 to the financial
statements appeared to be materially adequate;

• Nothing has come to our attention regarding material instances of forgery or irregularity or administrative error and exception or anything
detrimental committed by employees of the Bank and its related entities.

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254
 c) The financial statements of the Bank’s subsidiaries named Bank Asia Securities Limited audited by us, but other two overseas
subsidiaries BA Exchange Company (UK) Limited and BA Express USA Inc. was not audited by us. The financial statements of BA
Exchange Company (UK) Limited for the year ended 31 December 2017 have been audited by AGP Consulting Chartered Accountants
and Statutory Auditors, UK and expressed an unmodified opinion. The financial statements of BA Express USA Inc. for the year ended 31
December 2017 have been audited by United Financial CPA PC, USA and expressed an unmodified opinion. These accounts have been
properly reflected in the consolidated in the consolidated financial statements.

d) In our opinion, proper books of accounts as required by law have been kept by the Group and the Bank so far as it appeared from our
examination of those books and proper returns adequate for the purpose of our audit have been received from branches not visited by
us;

e) The expenditure incurred was for the purposes of the Bank’s business.

f) The consolidated balance sheet and consolidated profit & loss account of the Group and the separate profit and loss account of the
Bank together with the annexed notes dealt with by the report are in agreement with the books of account;

g) The consolidated financial statements of the Group and the separate financial statements of the Bank have been drawn up in
conformity with prevailing rules, regulations and accounting standards as explained in Note # 2.1 as well as with related meeting
amongst Inspection Team of Bangladesh Bank, External Auditor and the Management of Bank Asia Limited held on 18 March 2018 and
subsequent letter # DBI-1/120/2018/74 dated 03 April 2018 issued by Bangladesh Bank;

h) Provisions have been made as of 31 December 2017 for loan and advances, other assets and off balance sheet items which are, in our
opinion, doubtful of recovery;

i) The records and statements submitted by the branches have been properly maintained and consolidated in the financial statements;

j) The information and explanations required by us have been received and focused satisfactory;

k) We have reviewed over 80% of the risk weighted assets of the Bank and we have spent around 5,250 persons working hours during the
audit; and

l) Capital to Risk Weighted Assets Ratio (CRAR) is required by the Bangladesh Bank has been maintained adequately during the year.

Other Matter

The Consolidated financial statements including the separate financial statements of Bank Asia Limited for the year ended 31 December
2016 were audited by Hoda Vasi Chowdhury & Co., Chartered Accountants, who expressed an unmodified opinion on those financial
statements on 16 April 2017.

Dhaka, Dated ACNABIN

April 08, 2018 Chartered Accountants

Annual Integrated Report 2017

255
 Bank Asia Limited and its subsidiaries
Consolidated Balance Sheet
as at 31 December 2017
Amount in Taka

Notes 31 Dec 2017 31 Dec 2016

PROPERTY AND ASSETS
Cash 4(a) 17,933,208,773 15,983,718,054
In hand (including foreign currencies) 4.1(a) 1,994,978,583 2,079,897,416
Balance with Bangladesh Bank and its agent bank
(including foreign currencies) 4.2(a) 15,938,230,190 13,903,820,638
Balance with other banks and financial institutions 5(a) 30,077,880,452 13,615,107,372
In Bangladesh 29,087,820,840 10,983,805,427
Outside Bangladesh 990,059,612 2,631,301,945
Money at call and on short notice 6(a) - 4,870,000,000
Investments 7(a) 28,145,350,291 39,711,806,539
Government 24,431,255,000 36,112,473,144
Others 3,714,095,291 3,599,333,395
Loans and advances/investments 8(a) 200,328,423,831 166,539,916,390
Loans, cash credits, overdrafts, etc/investments 184,322,321,558 157,946,507,822
Bills purchased and discounted 16,006,102,273 8,593,408,568
Fixed assets including premises, furniture and fixtures 9(a) 5,344,230,907 5,263,148,467
Other assets 10(a) 9,117,178,530 8,882,423,376
Non - banking assets - -
Total assets 290,946,272,783 254,866,120,198
LIABILITIES AND CAPITAL
Liabilities
Borrowings from other banks, financial institutions and agents 11(a) 30,465,558,247 18,978,976,940
Subordinated non-convertible bonds 11(aa) 8,092,588,885 3,197,214,016
Deposits and other accounts 12(a) 207,283,945,687 191,573,043,588
Current/Al-wadeeah current accounts and other accounts 42,242,103,482 34,554,219,481
Bills payable 3,968,967,652 4,902,979,613
Savings bank/Mudaraba savings bank deposits 34,496,938,426 27,793,803,978
Fixed deposits/Mudaraba fixed deposits 126,575,936,127 124,322,040,516
Bearer certificates of deposit - -
Other deposits - -
Other liabilities 13(a) 24,170,500,633 22,253,446,819
Total liabilities 270,012,593,452 236,002,681,362
Capital/shareholders' equity
Total shareholders' equity 20,933,679,331 18,863,438,836
Paid-up capital 14.2 9,870,110,990 8,812,599,100
Statutory reserve 15 7,345,137,782 6,533,632,030
Revaluation reserve 16(a) 2,154,384,193 2,239,612,377
General reserve 8,166,144 8,166,144
Retained earnings 17(a) 1,554,316,722 1,267,955,303
Foreign currency translation reserve 1,551,777 1,462,526
Non-controlling (minority) interest 17(b) 11,723 11,355
Total liabilities and shareholders' equity 290,946,272,783 254,866,120,198

Bank Asia Limited

256
Consolidated
Balance Sheet

Amount in Taka

Notes 31 Dec 2017 31 Dec 2016

OFF-BALANCE SHEET ITEMS
Contingent liabilities 18 135,839,309,791 110,762,047,002
Acceptances and endorsements 42,864,351,001 35,098,107,666
Letters of guarantee 40,615,034,541 35,578,341,924
Irrevocable letters of credit 37,891,236,914 29,013,641,402
Bills for collection 14,468,687,335 11,071,956,010
Other contingent liabilities - -
Other commitments 317,134,285 -
Documentary credits and short term trade-related transactions - -
Forward assets purchased and forward deposits placed 317,134,285 -
Undrawn note issuance and revolving underwriting facilities - -
Undrawn formal standby facilities, credit lines and other commitments - -
Total off-balance sheet items including contingent liabilities 136,156,444,076 110,762,047,002

These Financial Statements should be read in conjunction with the annexed notes

Chairman Director Director Director President and Managing Director

Report of the auditor’s to the shareholders:
This is the statement of Consolidated Balance Sheet referred to our report of even date.

Dhaka, Dated
08 April 2018 ACNABIN
Chartered Accountants

Annual Integrated Report 2017

257
 Bank Asia Limited and its subsidiaries
Consolidated Profit and Loss Statement

for the year ended 31 December 2017

Amount in Taka
Notes 31 Dec 2017 31 Dec 2016
OPERATING INCOME
Interest income 20(a) 16,537,474,861 14,795,577,265
Interest paid on deposits and borrowings, etc 21(a) 10,853,728,866 10,607,924,671
Net interest income 5,683,745,995 4,187,652,594
Investment income 22(a) 2,535,391,259 3,548,303,241
Commission, exchange and brokerage 23(a) 3,346,784,283 2,620,174,212
Other operating income 24(a) 804,643,551 683,489,936
6,686,819,093 6,851,967,389
Total operating income (A) 12,370,565,088 11,039,619,983
OPERATING EXPENSES
Salaries and allowances 25(a) 2,595,054,425 2,403,117,832
Rent, taxes, insurance, electricity, etc 26(a) 640,514,240 558,761,586
Legal expenses 27(a) 25,877,298 18,046,458
Postage, stamp, telecommunication, etc 28(a) 92,453,590 84,071,480
Stationery, printing, advertisements, etc 29(a) 100,166,466 91,527,800
Managing Director's salary and fees 30 13,900,000 15,689,899
Directors' fees 31(a) 3,286,400 3,422,000
Auditors' fees 32(a) 3,106,584 3,339,006
Depreciation and repairs of Bank's assets 33(a) 464,055,824 473,133,169
Other expenses 34(a) 1,499,454,887 1,201,053,151
Total operating expenses (B) 5,437,869,714 4,852,162,381
Profit before provision (C=A-B) 6,932,695,374 6,187,457,602
Provision for loans and advances/investments
General provision 1,171,754,018 555,793,056
Specific provision 1,339,895,000 1,928,486,005
2,511,649,018 2,484,279,061
Provision for off-balance sheet items 223,379,000 139,449,902
Provision for diminution in value of investments 906,056 121,619,793
Other provisions - -
Total provision (D) 34(C) 2,735,934,074 2,745,348,756
Total profit before tax (C-D) 4,196,761,300 3,442,108,846
Provision for taxation
Current tax 13.5 2,043,171,957 1,735,042,600
Deferred tax 41,500,000 63,000,000
2,084,671,957 1,798,042,600
Net profit after tax 2,112,089,343 1,644,066,246
Appropriations
Statutory reserve 15 811,505,752 657,381,109
General reserve - -
811,505,752 657,381,109
Retained surplus 1,300,583,591 986,685,137
Attributable to:
Equity holders of Bank Asia Limited 1,300,583,223 986,684,567
Non-controlling (minority) interest 368 570
1,300,583,591 986,685,137
Earnings Per Share (EPS) 37(a) 2.14 1.67
These Financial Statements should be read in conjunction with the annexed notes

Chairman Director Director Director President and Managing Director

Report of the auditor’s to the shareholders:
This is the statement of Consolidated Profit and Loss statement referred to our report of even date.

Dhaka, Dated
08 April 2018 ACNABIN
Chartered Accountants

Bank Asia Limited

258
Bank Asia Limited and its subsidiaries
Consolidated Cash Flow Statement

for the year ended 31 December 2017

Amount in Taka
Notes 31 Dec 2017 31 Dec 2016
Cash flows from operating activities (A)
Interest receipts 18,210,636,506 17,064,780,537
Interest payments (10,765,570,591) (10,607,924,671)
Dividends receipts 53,427,973 41,515,740
Fees and commission receipts 3,346,784,283 2,620,174,212
Recoveries on loans previously written off 34,250,512 42,108,117
Cash payment to employees (2,544,380,951) (2,444,083,935)
Cash payment to suppliers (166,777,619) (161,747,580)
Income tax paid (1,760,330,963) (1,567,515,086)
Receipts from other operating activities 35 (a) 1,009,792,761 1,275,012,121
Payments for other operating activities 36 (a) (2,279,360,190) (1,884,235,223)
Operating profit before changes in operating assets & liabilities 5,138,471,721 4,378,084,232
Increase/(decrease) in operating assets and liabilities
Loans and advances to customers and banks (33,822,757,953) (27,577,429,172)
Other assets (649,664,410) (142,903,331)
Deposits from customers and banks 15,710,902,099 21,427,217,267
Trading liabilities 11,486,581,307 6,643,522,662
Other liabilities (306,007,676) (114,805,041)
Net Increase/(decrease) in operating assets and liabilities (7,580,946,633) 235,602,385
Net cash flows from operating activities (2,442,474,913) 4,613,686,618
Cash flows from investing activities (B)
Investments in treasury bills, bonds and others 11,681,218,144 7,480,493,239
Sale/(Purchase) of trading securities (114,761,896) (154,232,877)
(Purchase)/disposal of fixed assets (478,395,241) (573,583,751)
Net cash flows from/(used in) investing activities 11,088,061,007 6,752,676,611
Cash flows from financing activities ( C )
Payment for finance lease (107,864) (148,357)
Issue of floating rate non-convertible subordinated bonds 5,000,000,000 -
Adjustment of subordinated non-convertible bond (104,625,131) (118,226,630)
Dividend paid (cash dividend) - (1,258,942,730)
Net cash flows from/(used in) financing activities 4,895,267,005 (1,377,317,717)
Net increase/(decrease) in cash and cash equivalents (A+B+C) 13,540,853,099 9,989,045,511
Effects of exchange rate changes on cash and cash equivalents - -
Cash and cash equivalents at the beginning of the year 34,471,916,226 24,482,870,715
Cash and cash equivalents at the end of the year 48,012,769,325 34,471,916,226
Cash and cash equivalents:
Cash 1,994,978,583 2,079,897,416
Balance with Bangladesh Bank and its agent bank(s) 15,938,230,190 13,903,820,638
Balance with other banks and financial institutions 30,077,880,452 13,615,107,372
Money at call and on short notice - 4,870,000,000
Prize bonds 1,680,100 3,090,800
48,012,769,325 34,471,916,226
These Financial Statements should be read in conjunction with the annexed notes

Chairman Director Director Director President and Managing Director

Annual Integrated Report 2017

259
260
Bank Asia Limited and its subsidiaries
Consolidated Statement of Changes in Equity
for the year ended 31 December 2017

Amount in Taka
Foreign
Retained Non-con-
Paid-up Statutory Revaluation General currency Total
Particulars earnings Total trolling
capital reserve reserve reserve translation equity
interest
reserve
Balance at 01 January 2016 8,392,951,530 5,876,250,921 2,549,629,842 8,166,144 1,541,779 1,867,693,933 18,696,234,149 10,785 18,696,244,934
Transferred during the year - 657,381,109 - - - (657,381,109) - - -
Adjustment on revaluation of fixed assets and
- - (227,816,977) - - - (227,816,977) - (227,816,977)
other investment
Transferred to retained earnings - - (82,200,488) - - 82,200,488 - - -
Foreign currency translation for opening retained
- - - - - 9,966,616 9,966,616 - 9,966,616
earnings
Foreign currency translation for the year - - - - (79,253) - (79,253) - (79,253)
Issue of bonus shares 419,647,570 - - - - (419,647,570) - - -
Cash dividend paid - - - - - (1,258,942,730) (1,258,942,730) (1,258,942,730)
Net profit for the year - - - - - 1,644,065,676 1,644,065,676 570 1,644,066,246
Balance as at 31 December 2016 8,812,599,100 6,533,632,030 2,239,612,377 8,166,144 1,462,526 1,267,955,303 18,863,427,481 11,355 18,863,438,836
Transferred during the year - 811,505,752 - - - (811,505,752) - - -
Adjustment on revaluation of fixed assets and
- - (31,512,920) - - - (31,512,920) - (31,512,920)
other investment
Transferred to retained earnings - - (53,715,264) - - 53,715,264 - - -
Foreign currency translation for opening retained
- - - - - (10,425,178) (10,425,178) - (10,425,178)
earnings
Foreign currency translation for the year - - - - 89,250 - 89,250 - 89,250
Issue of bonus shares 1,057,511,890 - - - - (1,057,511,890) - - -
Net profit for the year - - - - - 2,112,088,975 2,112,088,975 368 2,112,089,343
Balance as at 31 December 2017 9,870,110,990 7,345,137,782 2,154,384,193 8,166,144 1,551,777 1,554,316,722 20,933,667,608 11,723 20,933,679,331
These Financial Statements should be read in conjunction with the annexed notes

Chairman Director Director Director President and Managing Director

Bank Asia Limited

Bank Asia Limited
Balance Sheet
as at 31 December 2017

Amount in Taka
Notes 31 Dec 2017 31 Dec 2016
PROPERTY AND ASSETS
Cash 4 17,930,274,917 15,980,758,895
In hand (including foreign currencies) 4.1 1,992,044,727 2,076,938,257
Balance with Bangladesh Bank and its agent bank 4.2 15,938,230,190 13,903,820,638
(including foreign currencies)
Balance with other banks and financial institutions 29,603,011,389 13,273,233,476
In Bangladesh 5.1 28,766,652,560 10,702,481,995
Outside Bangladesh 5.2 836,358,829 2,570,751,481
Money at call and on short notice 6 - 4,870,000,000
Investments 7 27,545,818,419 39,365,212,025
Government 24,431,255,000 36,112,473,144
Others 3,114,563,419 3,252,738,881
Loans and advances/investments 8 197,504,138,756 163,609,782,739
Loans, cash credits, overdrafts, etc/investments 181,498,036,483 155,016,374,171
Bills purchased and discounted 16,006,102,273 8,593,408,568
Fixed assets including premises, furniture and fixtures 9 5,329,740,498 5,249,722,487
Other assets 10 11,083,658,773 10,846,991,614
Non - banking assets - -
Total assets 288,996,642,751 253,195,701,236
LIABILITIES AND CAPITAL
Liabilities
Borrowings from other banks, financial institutions and agents 11 30,268,312,053 18,822,423,424
Subordinated non-convertible bonds 11 (aa) 8,092,588,885 3,197,214,016
Deposits and other accounts 12 207,041,471,381 191,272,582,777
Current/Al-wadeeah current accounts and other accounts 41,999,629,176 34,253,758,670
Bills payable 3,968,967,652 4,902,979,613
Savings bank/Mudaraba savings bank deposits 34,496,938,426 27,793,803,978
Fixed deposits/Mudaraba fixed deposits 126,575,936,127 124,322,040,516
Bearer certificates of deposit - -
Other deposits - -
Other liabilities 13 22,539,776,869 20,865,003,294
Total liabilities 267,942,149,188 234,157,223,511
Capital/shareholders' equity
Total shareholders' equity 21,054,493,564 19,038,477,725
Paid-up capital 14.2 9,870,110,990 8,812,599,100
Statutory reserve 15 7,345,137,782 6,533,632,030
Revaluation reserve 16 2,154,384,193 2,239,612,377
General reserve 8,166,144 8,166,144
Retained earnings 17 1,676,694,455 1,444,468,074
Total liabilities and shareholders' equity 288,996,642,751 253,195,701,236

Annual Integrated Report 2017

261
 Balance
Sheet

Amount in Taka

Notes 31 Dec 2017 31 Dec 2016

OFF-BALANCE SHEET ITEMS
Contingent liabilities 18 135,839,309,791 110,762,047,002
Acceptances and endorsements 42,864,351,001 35,098,107,666
Letters of guarantee 40,615,034,541 35,578,341,924
Irrevocable letters of credit 37,891,236,914 29,013,641,402
Bills for collection 14,468,687,335 11,071,956,010
Other contingent liabilities - -
Other commitments 317,134,285 -
Documentary credits and short term trade-related transactions - -
Forward assets purchased and forward deposits placed 317,134,285 -
Undrawn note issuance and revolving underwriting facilities - -
Undrawn formal standby facilities, credit lines and other commitments - -
Total off-balance sheet items including contingent liabilities 136,156,444,076 110,762,047,002

These Financial Statements should be read in conjunction with the annexed notes

Chairman Director Director Director President and Managing Director

Report of the auditor’s to the shareholders:
This is the statement of Balance Sheet referred to our report of even date.

Dhaka, Dated
08 April 2018 ACNABIN
Chartered Accountants

Bank Asia Limited

262
Bank Asia Limited
Profit and Loss Statement
for the year ended 31 December 2017

Amount in Taka

Notes 31 Dec 2017 31 Dec 2016

OPERATING INCOME
Interest income 20 16,411,574,859 14,569,387,489
Interest paid on deposits and borrowings, etc 21 10,841,556,834 10,600,935,255
Net interest income 5,570,018,025 3,968,452,234
Investment income 22 2,535,391,259 3,548,303,241
Commission, exchange and brokerage 23 3,119,816,288 2,474,861,280
Other operating income 24 742,166,065 648,277,718
6,397,373,612 6,671,442,239
Total operating income (A) 11,967,391,637 10,639,894,473
OPERATING EXPENSES
Salaries and allowances 25 2,519,793,179 2,336,571,464
Rent, taxes, insurance, electricity, etc 26 613,241,644 533,568,147
Legal expenses 27 24,615,519 16,085,833
Postage, stamp, telecommunication, etc 28 89,544,014 81,601,730
Stationery, printing, advertisements, etc 29 97,405,242 90,134,202
Managing Director's salary and fees 30 13,900,000 15,689,899
Directors' fees 31 2,992,000 3,192,000
Auditors' fees 32 952,100 1,252,000
Depreciation and repairs of Bank's assets 33 459,920,443 469,051,286
Other expenses 34 1,457,470,719 1,172,113,402
Total operating expenses (B) 5,279,834,860 4,719,259,963
Profit before provision (C=A-B) 6,687,556,777 5,920,634,510
Provision for loans and advances/investments
General provision 1,171,754,018 555,793,056
Specific provision 1,234,895,000 1,828,486,005
13.2 2,406,649,018 2,384,279,061
Provision for off-balance sheet items 13.3 223,379,000 139,449,902
Provision for diminution in value of investments 13.7 - 110,000,000
Other provisions 13.8 - -
Total provision (D) 2,630,028,018 2,633,728,963
Total profit before tax (C-D) 4,057,528,759 3,286,905,547
Provision for taxation
Current tax 13.5.1 1,968,500,000 1,678,000,000
Deferred tax 13.5.2 41,500,000 63,000,000
2,010,000,000 1,741,000,000
Net profit after tax 2,047,528,759 1,545,905,547
Appropriations
Statutory reserve 15 811,505,752 657,381,109
General reserve - -
811,505,752 657,381,109
Retained surplus 1,236,023,007 888,524,438
Earnings Per Share (EPS) 37 2.07 1.57
These Financial Statements should be read in conjunction with the annexed notes

Chairman Director Director Director President and Managing Director

Report of the auditor’s to the shareholders:
This is the statement of Profit and Loss Statement referred to our report of even date.

Dhaka, Dated
08 April 2018 ACNABIN
Chartered Accountants

263
 Bank Asia Limited
Cash Flow Statement
for the year ended 31 December 2017
Amount in Taka
Notes 31 Dec 2017 31 Dec 2016
Cash flows from operating activities (A)
Interest receipts 17,912,520,733 16,838,590,761
Interest payments (10,581,182,788) (10,600,935,255)
Dividends receipts 53,427,973 41,515,740
Fees and commission receipts 3,119,816,288 2,474,861,280
Recoveries on loans previously written off 34,250,512 42,108,117
Cash payment to employees (2,469,119,705) (2,377,537,567)
Cash payment to suppliers (164,016,395) (160,353,982)
Income tax paid (1,674,512,383) (1,546,814,137)
Receipts from other operating activities 35 947,315,275 1,239,799,903
Payments for other operating activities 36 (2,203,483,187) (1,823,354,654)
Operating profit before changes in operating assets & liabilities 4,975,016,323 4,127,880,206
Increase/(decrease) in operating assets and liabilities
Loans and advances to customers and banks (33,894,356,017) (27,213,447,058)
Other assets (615,842,133) (72,607,861)
Deposits from customers and banks 15,768,888,604 21,445,242,386
Trading liabilities 11,445,888,629 6,526,307,876
Other liabilities (511,741,228) (167,686,392)
Net Increase/(decrease) in operating assets and liabilities (7,807,162,145) 517,808,951
Net cash flows from operating activities (2,832,145,823) 4,645,689,157
Cash flows from investing activities (B)
Investments in treasury bills, bonds and others 11,681,218,144 7,480,493,239
Sale/(Purchase) of trading securities 138,175,462 (27,188,034)
(Purchase)/disposal of fixed assets (474,631,553) (573,005,787)
Net cash flows from/(used in) investing activities 11,344,762,053 6,880,299,418
Cash flows from financing activities (C)
Payment for finance lease (107,864) (148,357)
Issue of floating rate non-convertible subordinated bonds 5,000,000,000 -
Adjustment of subordinated non-convertible bond (104,625,131) (118,226,630)
Dividend paid (cash dividend) - (1,258,942,730)
Net cash flows from/(used in) financing activities 4,895,267,005 (1,377,317,717)
Net increase/(decrease) in cash and cash equivalents (A+B+C) 13,407,883,235 10,148,670,858
Effects of exchange rate changes on cash and cash equivalents - -
Cash and cash equivalents at the beginning of the year 34,127,083,171 23,978,412,313
Cash and cash equivalents at the end of the year 47,534,966,406 34,127,083,171
Cash and cash equivalents:
Cash 1,992,044,727 2,076,938,257
Balance with Bangladesh Bank and its agent bank(s) 15,938,230,190 13,903,820,638
Balance with other banks and financial institutions 29,603,011,389 13,273,233,476
Money at call and on short notice - 4,870,000,000
Prize bonds 1,680,100 3,090,800
47,534,966,406 34,127,083,171
These Financial Statements should be read in conjunction with the annexed notes

Chairman Director Director Director President and Managing Director

Bank Asia Limited

264
 Bank Asia Limited
Statement of Changes in Equity
for the year ended 31 December 2017

Amount in Taka

Annual Integrated Report 2017

Paid-up Statutory Revaluation General Retained
Particulars Total
capital reserve reserve reserve earnings
Balance at 01 January 2016 8,392,951,530 5,876,250,921 2,549,629,842 8,166,144 2,152,333,448 18,979,331,885
Transferred during the year - 657,381,109 - - (657,381,109) -
Adjustment on revaluation of fixed assets and other invest- - - (227,816,977) - - (227,816,977)
ment
Transferred to retained earnings - - (82,200,488) - 82,200,488 -
Issue of bonus shares 419,647,570 - - - (419,647,570) -
Cash dividend paid - - - - (1,258,942,730) (1,258,942,730)
Net profit for the year - - - - 1,545,905,547 1,545,905,547
Balance at 31 December 2016 8,812,599,100 6,533,632,030 2,239,612,377 8,166,144 1,444,468,074 19,038,477,725
Transferred during the year - 811,505,752 - - (811,505,752) -
Adjustment on revaluation of fixed assets and other invest- - - (31,512,920) - - (31,512,920)
ment
Transferred to retained earnings - - (53,715,264) - 53,715,264 -
Issue of bonus shares 1,057,511,890 - - - (1,057,511,890) -
Net profit for the year - - - - 2,047,528,759 2,047,528,759
Balance at 31 December 2017 9,870,110,990 7,345,137,782 2,154,384,193 8,166,144 1,676,694,454 21,054,493,564
These Financial Statements should be read in conjunction with the annexed notes

Chairman Director Director Director President and Managing Director

265
266
Bank Asia Limited
Liquidity Statement (Analysis of Maturity of Assets and Liabilities)
as at 31 December 2017

Amount in Taka
Maturity
Particulars Up to 1-3 3-12 1-5 Above Total
1 month months months years 5 years
Assets
Cash in hand and with banks 4,853,012,494 - - - 13,077,262,423 17,930,274,917
Balance with other banks and financial institutions 14,741,061,389 14,203,150,000 658,800,000 - - 29,603,011,389
Money at call and on short notice - - - - - -
Investments 1,160,789,398 5,090,869,350 4,281,322,451 5,616,477,758 11,396,359,462 27,545,818,419
Loans and advances 28,256,123,459 34,402,360,425 48,521,499,210 57,693,757,224 28,630,398,438 197,504,138,756
Fixed assets including premises, furniture and fixtures - - - - 5,329,740,498 5,329,740,498
Other assets 1,207,824,378 1,613,945,758 841,323,819 5,381,572,306 2,038,992,512 11,083,658,773
Non-banking assets - - - - - -
Total Assets (A) 50,218,811,118 55,310,325,533 54,302,945,480 68,691,807,288 60,472,753,332 288,996,642,751
Liabilities
Borrowings from Bangladesh Bank, other banks, financial institutions and
agents
4,932,033,963 14,454,700,000 7,238,807,914 3,735,359,061 8,000,000,000 38,360,900,938
Deposits 32,262,600,000 31,892,481,831 59,518,732,453 54,191,271,406 29,176,385,691 207,041,471,381
Provision and other liabilities 415,684,684 237,649,609 1,009,562,232 717,790,274 20,159,090,070 22,539,776,869
Total Liabilities (B) 37,610,318,647 46,584,831,440 67,767,102,599 58,644,420,741 57,335,475,761 267,942,149,188
Net Liquidity Excess/(Shortage) (A-B) 12,608,492,471 8,725,494,093 (13,464,157,119) 10,047,386,547 3,137,277,572 21,054,493,564

Chairman Director Director Director President and Managing Director

Bank Asia Limited

Bank Asia Limited
Notes to the financial statements
as at and for the year ended 31 December 2017

1. THE BANK AND ITS ACTIVITIES

1.1 Bank Asia Limited

Bank Asia Limited (“the Bank”) is one of the third generation private commercial banks (PCBs) incorporated in Bangladesh on 28
September 1999 as a public limited company under the Companies Act 1994, governed by the Bank Company Act 1991. The Bank
went for public issue of its shares on 23 September 2003 and its shares are listed with Dhaka Stock Exchange Limited and Chittagong
Stock Exchange Limited. At present the Bank has 116 branches, 4 SME service centres, 5 Islamic Windows and 132 own ATM booths.
The Bank has three subsidiary companies namely, Bank Asia Securities Limited incorporated in Bangladesh, BA Exchange Company
(UK) Limited incorporated in United Kingdom and BA Express USA Inc. incorporated in United States of America (USA). The Bank has
also an Offshore Banking Unit (OBU) at Chittagong Export Processing Zone, Chittagong.
Bank Asia Limited acquired the business of Bank of Nova Scotia, Dhaka (incorporated in Canada) in the year 2001. At the begin-
ning of the year 2002, the Bank also acquired the Bangladesh operations of Muslim Commercial Bank Limited (MCBL), a bank
incorporated in Pakistan, having two branches at Dhaka and Chittagong. In taking over Bangladesh operations, all assets and
certain specific liabilities of MCBL were taken over by Bank Asia Limited at their book values.
The registered office of the Bank is situated at Rangs Tower, 68 Purana Paltan, Dhaka 1000, Bangladesh.

1.2 Principal activities

The principal activities of the Bank are to provide all kinds of conventional and Islamic commercial banking services to its
customers through its branches, islamic windows, SME centres, and vibrant alternative delivery channels (ATM booths, Mobile
banking, internet banking) in Bangladesh.

1.3 Islamic banking unit

The Bank obtained permission from Bangladesh Bank (country’s central bank) to operate Islamic Banking Unit vide Bangladesh
Bank’s letter no. BRPD(P-3)745(53)/2008-4804 dated 17 December 2008. The Bank commenced operation of this Unit from 24
December 2008. The Islamic Banking Unit is governed under the rules and regulations of Bangladesh Bank.

1.4 Off-shore banking unit

The Bank obtained off-shore banking unit permission from Bangladesh Bank vide its letter no. BRPD (P-3)744(94)/2007-1853 dated
21 June 2007. Operation of this unit commenced from 28 January 2008 and its office is located at Zone Service Complex, Chittagong
Export Processing Zone, Chittagong. Off-shore banking unit is governed under the rules and regulations of Bangladesh Bank.

1.5 Bank Asia Securities Limited

Bank Asia Securities Limited, a majority owned (99.99%) subsidiary company of Bank Asia Limited was incorporated as a private
limited company in Bangladesh on 04 August 2010 bearing certificate of incorporation no. C-86230/10 dated 04 August 2010
under the Companies Act 1994 having its registered office at Hadi Mansion (7th Floor), 2 Dilkusha Commercial Area, Dhaka 1000
which has commenced its business on the 17 April 2011.

The main objective of this company is to act as a full fledged stock broker and stock dealer to execute buy and sale order and
to maintain own portfolio as well as customers’ portfolio under the discretion of customers. It also performs the other activities
relating to capital market as and when regulators permit.

1.6 BA Exchange Company (UK) Limited

BA Exchange Company (UK) Limited was incorporated as a private limited company under United Kingdom Companies Act and
registered with Companies House of England and Wales vide registration no. 07314397 as a fully owned subsidiary company of
Bank Asia Limited, BA Exchange Company (UK) Limited launched its operation in London on 16 May 2011. BA Exchange Company
(UK) Limited attaches a fresh width to the Bank’s remittance operation and expands its global presence for remittance services.
Bank Asia stretched its business in United Kingdom through its fully owned (100%) subsidiary to facilitate speedy and depend-
able medium for remitting the hard-earned money of expatriates to home.

1.7 BA Express USA inc

BA Express USA inc is fully owned subsidiary company of Bank Asia Limited incorporated in New York State Department of Fi-
nancial Services (NYSDFS) in USA. The company obtained license to receive money for transmission within USA and abroad and
to transmit same, pursuant to the provision of Article 13-B of the USA Banking Law, subject to all rules and regulations made by
the Superintendent of Financial Services of New York relating to such business, effective 22 November 2013. The company has
started its commercial operation from 01 June 2014.

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 Notes to the
financial statements
2. BASIS OF PREPARATION
2.1 Statement of compliance
The financial statements of the Bank have been prepared in accordance with the “First Schedule (Section 38) of the Bank Company
Act 1991 (amended upto 2018), BRPD circular no. 14 dated 25 June 2003, other Bangladesh Bank Circulars, Bangladesh Financial
Reporting Standards (BFRSs), Bangladesh Accounting Standards (BAS), etc. The Financial Reporting Act 2015 (FRA) has been enacted
in 2015. Under the FRA the Financial Reporting Council (FRC) yet to be formed and they will issue financial reporting standards for
public interest entities such as banks. Section 38 of the Bank Company Act 1991 (amended upto 2018) has been replaced through
BRPD Circular no. 10 dated October 04, 2015. The FRC is yet to be formed and as such no financial reporting standards have issued
as per the provisions of the FRA. The Bank complied with the requirement of the following regulatory and legal authorities:

i. Bank Company Act 1991 (amended upto 2018)

ii. Companies Act 1994
iii Rules, regulations and circulars issued by the Bangladesh Bank from time to time
iv. The Securities and Exchange Ordinance 1969
v. The Securities and Exchange Rules 1987
vi Bangladesh Securities and Exchange Commission Act 1993
vii. Bangladesh Securities and Exchange Commission (Public Issues) Rules 2015
viii. Income Tax Ordinance and Rules 1984
ix. Value Added Tax Act 1991
x. Dhaka Stock Exchange Ltd. (DSE), Chittagong Stock Exchange Ltd. (CSE) and Central Depository Bangladesh Ltd. (CDBL) rules
and regulations.

In case the requirement of provisions and circulars issued by Bangladesh Bank differs with those of other regulatory authorities
and accounting standards, the provisions and circulars issued by Bangladesh Bank shall prevail.

Bank have departed from certain contradictory requirements of BFRSs in order to comply with the rules and regulations of
Bangladesh Bank which are disclosed below:

i) Presentation of financial statements

BFRS: As per BAS 1, a complete set of financial statements comprises a statement of financial position, a statement of profit or loss
and other comprehensive income, a statement of changes in equity, a statement of cash flows, notes comprising a summary of
significant accounting policies and other explanatory information and comparative information. BAS 1 has also stated the entity to
disclose assets and liabilities under current and non-current classification separately in its statement of financial position.

Bangladesh Bank: A format of financial statements (i.e. balance sheet, profit and loss account, cash flows statement, changes
in equity, liquidity statement) is prescribed in the “First Schedule” of section 38 of the Bank Company Act 1991 (amended up to
2018) and BRPD circular no. 14 dated 25 June 2003 of Bangladesh Bank. Assets and liabilities are not classified under current and
non-current heading in the prescribed format of financial statements.

ii) Investment in shares and Securities

BFRS: As per requirements of BAS 39 investment in shares and securities generally falls either under “at fair value through profit
and loss account” or under “available for sale” where any change in the fair value at the year-end is taken to profit and loss
account or other comprehensive income/revaluation reserve respectively.

Bangladesh Bank: As per BRPD circular no. 14 dated 25 June 2003 investments in quoted shares and unquoted shares are
revalued at the year end at market price and as per book value of last audited balance sheet respectively. As per DOS circular
letter no. 03 dated March 12, 2015, investment in Mutual Fund (close-end) is revalued at lower of cost and (higher of market value
and 85% of NAV). Being provision is made for any loss arising from diminution in value of investment; otherwise investments are
recognized at costs.

iii) Revaluation gain/loss on Government securities

BFRS: As per requirement of BAS 39 where T-bills and T-bonds will fall under the category of “held for trading”, any change in the
fair value of held for trading assets is recognized through profit and loss account. T-bills/bonds designated as held to maturity are
measured at amortized cost method and interest income is recognized through the profit & loss account.

Bangladesh Bank: According to DOS circular no. 05 dated 26 May 2008 and subsequent clarification in DOS circular no. 05 dated
28 January 2009 loss on revaluation of Government securities (T-bill/T-bond) which are categorized as held for trading will

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Notes to the
financial statements
be charged through profit and loss account, but any gain on such revaluation should be recorded under Revaluation Reserve
Account. However at the year-end if there is any revaluation gain for any particular held for trading T-bills/T-bonds, such gain
can be used to the extent of any revaluation loss for that particular held for trading T-bills/T-bonds. T-bills designated as held to
maturity are measured at amortized cost method but interest income/gain is recognized through reserve.

iv) Provision on loans and advances

BFRS: As per BAS 39 an entity should start the impairment assessment by considering whether objective evidence of impairment
exists for financial assets that are individually significant. For financial assets which are not individually significant, the
assessment can be performed on an individual or collective (portfolio) basis.
Bangladesh Bank: As per BRPD circular no. 16 dated 18 November 2014, BRPD Circular 14 dated 23 September 2012, BRPD
Circular no. 19 dated 27 December 2012 and BRPD Circular no. 05 dated 29 May 2013, provision for sub-standard loans, doubtful
loans and bad losses has to be provided at 20%, 50% and 100% respectively for loans and advances depending on the duration
of overdue. Provision for unclassified loan was made at the specified rate i.e. 0.25% to 5% based on different categories of loans
and advances. Such provision policies are not specifically in line with those prescribed by BAS 39. Also, a general provision @ 1%
should be provided for off-balance sheet exposures.

v) Other comprehensive income

BFRS: As per BAS 1 Other Comprehensive income is a component of financial statements or the elements of Other
Comprehensive income are to be included in a Single Comprehensive income (OCI) Statement.
Bangladesh Bank: Bangladesh Bank has issued financial templates for financial statements which will strictly be followed by
all banks. The templates of financial statements issued by Bangladesh Bank do not include Other Comprehensive Income or
the elements of Other Comprehensive Income allowed to include in a Other Comprehensive Income (OCI) Statement. As such
the company does not prepare the other comprehensive income statement. However elements of OCI, if any, are shown in the
statements of changes in equity. Furthermore, the above templates require disclosure of appropriation of profit on the face of
Profit and Loss Statement.

vi) Financial instruments – presentation and disclosure

In several cases Bangladesh Bank guidelines categorize, recognize, measure and present financial instruments differently from
those prescribed in BAS 39. As such some disclosure and presentation requirements of BFRS 7 and BAS 32 cannot be made in the
accounts.

vii) Repo transactions

BFRS: When an entity sells a financial asset and simultaneously enters into an agreement to repurchase the asset (or a similar
asset) at a fixed price on a future date (repo or stock lending), the arrangement is accounted for as a deposit, and the underlying
asset continues to be recognized in the entity’s financial statements. This transaction will be treated as loan and the difference
between selling price and repurchase price will be treated as interest expense.
Bangladesh Bank: As per DOS Circular letter no. 06 dated 15 July 2010 and subsequent clarification in DOS Circular No. 02
dated 23 June 2013, when a bank sells a financial asset and simultaneously enters into an agreement to repurchase the asset
(or a similar asset) at a fixed price on a future date (repo or stock lending), the arrangement is accounted for as a normal sales
transactions and the financial assets are derecognized in the seller’s book and recognized in the buyer’s book.

viii) Financial guarantees

BFRS: As per BAS 39, financial guarantees are contracts that require an entity to make specified payments to reimburse to the
holder for a loss it incurs because a specified debtor fails to make payment when due in accordance with the terms of a debt
instrument. Financial guarantee liabilities are recognized initially at their fair value, and the initial fair value is amortized over the
life of the financial guarantee. The financial guarantee liability is subsequently carried at the higher of this amortized amount and
the present value of any expected payment when a payment under the guarantee has become probable. Financial guarantees
are included within other liabilities.

Bangladesh Bank: As per BRPD circular no. 14 dated 25 June 2003 financial guarantees such as L/C, L/G will be treated as
Off-Balance Sheet items. No liability is recognized for the guarantee except the cash margin and 1% general provision for all
contingent liabilities.
ix) Cash and cash equivalent
BFRS: Cash and cash equivalent items should be reported as cash item as per BAS 7.

Bangladesh Bank: As per BRPD Circular 14 dated 25 June 2003, Cash and cash-equivalents consist of cash with Bangladesh Bank,

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 Notes to the
financial statements
with its agent bank(s), government securities (prize bond) and deposits with other banks.
x) Non-banking asset
BFRS: No indication of Non-banking asset is found in any BFRS.

Bangladesh Bank: As per BRPD circular no. 14 dated 25 June 2003, there must exist a face item named Non-banking asset.
xi) Cash flow statement
BFRS: Cash flow statement can be prepared either in direct method or in indirect method as per BAS 7 of Statement of Cash
Flows. The presentation is selected to present these cash flows in a manner that is most appropriate for the business or industry.
The method selected is applied consistently.

Bangladesh Bank: As per BRPD circular no. 14 dated 25 June 2003, cash flow is the mixture of direct and indirect method.
xii) Balance with Bangladesh Bank: (CRR)
BFRS: Balance with Bangladesh Bank should be treated as other asset as it is not available for use in day to day operations as per BAS 7.

Bangladesh Bank: Balance with Bangladesh Bank is treated as cash and cash equivalents.
xiii) Presentation of intangible asset
BFRS: Intangible asset must be identified and recognized, and the disclosure must be given as per BAS 38.

Bangladesh Bank: There is no requirement for regulation of intangible assets in BRPD circular no. 14 dated 25 June 2003.
xiv) Off-balance sheet items
BFRS: There is no concept of off-balance sheet items in any BFRS; hence there is no requirement of disclosure of off-balance
sheet items.

Bangladesh Bank: As per BRPD circular no. 14 dated 25 June 2003 off balance sheet items must be disclosed separately in face of
balance sheet. Accordingly the Bank has recognized the following off balance sheet items:
- Acceptances and endorsements
- Letters of guarantee
- Irrevocable letters of credit
- Bills for collection
- Foreign exchange contracts
- Forward assets purchased and forward deposits placed
xv) Disclosure of appropriation of profit
BFRS: There is no requirement to show appropriation of profit in the face of statement of comprehensive income.

Bangladesh Bank: As per BRPD circular no. 14 dated 25 June 2003, an appropriation of profit should be disclosed in the face of
profit and loss account.
xvi) Loans and advance net of provision
BFRS: Loans and advances should be presented net of provisions.

Bangladesh Bank: As per BRPD circular no. 14 dated 25 June 2003 provision on loans and advances are presented separately as
liability and cannot be netted off against loans and advances.
xvii) Recognition of Interest in Suspense
BFRSs: Loans and advances to customers are generally classified as “loans and receivables” as per BAS 39 and interest income
is recognised through effective interest rate method over the term of the loan. Once a loan is impaired , interest income is
recognised in profit and loss account on the same basis based on revised carrying amount.

Bangladesh Bank: As per BRPD Circular No. 14 dated 23 September 2012, once a loan is classified , interest on such loans are not
allowed to be recognised as income, rather the corresponding amount needs to be credited to an interest in suspense account,
which is presented as liability in balance sheet.
xviii) Uniform Accounting Policy
In several cases Bangladesh Bank and Bangladesh Securities and Exchange Commission guidelines categorize, recognize,
measure and present financial instruments differently from those prescribed in BFRS 10. As such some disclosure, presentation
and measurement requirements of BFRS 10 cannot be made in financial statements.
(Also refer to note 3.19 Compliance of BFRSs)

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270
Notes to the
financial statements

2.2 Basis of measurement

The financial statements of the Bank have been prepared on historical cost basis except for the following:
- Government Treasury Bills and Bonds designated as ‘Held for Trading (HFT)’ at present value using marked to market with gains,
if any, credited to revaluation reserve.
- Government Treasury Bills and Bonds designated as ‘Held to Maturity (HTM)’ at present value using amortisation
concept.
- Zero Coupon Bonds at present value using amortisation concept.
2.3 Use of estimates and judgments
The preparation of the financial statements in conformity with BAS/ BFRS requires management to make judgments, estimates and
assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses.
Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions
to accounting estimates are recognised in the period in which the estimate is revised and in any future periods affected.

Key estimates include the following:

- Provision on loans and advances
- Deferred tax assets/liabilities
- Gratuity fund
2.4 Foreign currency transactions
Functional and presentation currency
These financial statements are presented in Bangladesh Taka (BDT), which is the Bank’s functional currency. Functional currencies
for Off-shore banking unit and BA Express USA Inc. are US Dollar, BA Exchange Company (UK) Limited is UK Pound. Except as
indicated, financial information have been rounded off to the nearest Taka.

Foreign currency translation

Foreign currency transactions have been converted into equivalent Taka currency at the ruling exchange rates on the respective date
of such transactions as per BAS 21 “The Effects of Changes in Foreign Exchange Rates”.

In preparing solo financial statements, assets and liabilities in foreign currencies as at December 31, 2017 have been converted into
Taka currency at the revaluation rate determined by the Bank. For BA Exchange Company (UK) Limited and BA Express USA Inc.
assets and liabilities in foreign currencies as at December 31, 2017 have been converted into Taka currency at the closing rate as on
December 31, 2017 and profit and loss accounts have been converted into monthly average rate.

Differences arising through buying and selling transactions of foreign currencies on different dates of the year have been adjusted
by debiting /crediting exchange gain or loss account. Foreign currency translation gain and loss for foreign subsidiary operation is
reported as separate component of Equity.

Commitment
Commitments for outstanding forward foreign exchange contracts disclosed in the consolidated financial statements and financial
statements of Bank have been translated at contracted rates. Contingent liabilities/commitments for letter of credit, letter of
guarantee and acceptance denominated in foreign currencies have been expressed in Taka currency at the rate of revaluation rate.

Translation gain and losses

Gains or losses arising out of translation of foreign exchange have been included in the Profit and Loss Statement, except those
arising on the translation of net investment in foreign subsidiaries.

Foreign operations
The results of financial statements of the Bank whose functional currency is not Bangladesh Taka are translated into Bangladesh
Taka as follows:

a. assets and liabilities for each statement of Balance Sheet have been translated at the closing rate on the date of Balance sheet.
b. income and expenses for Profit and Loss Statement have been translated at monthly average rate; and
c. all resulting exchange differences have been recognized as a separate components of equity.

2.5 Basis of consolidation

The financial statements of the Bank’s include the financial statements of main operation of Bank Asia Limited and its two business
units namely, Islamic Banking Unit and Off-shore Banking Unit operating in Bangladesh.
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 Notes to the
financial statements

The consolidated financial statements include the financial statements of the Bank and three subsidiary companies namely,
Bank Asia Securities Limited operating in Bangladesh , BA Exchange Company (UK) Limited operating in United Kingdom and BA
Express USA Inc. operating in United States of America.

The consolidated financial statements have been prepared in accordance with Bangladesh Accounting Standard 27: Separate
Financial Statements and Bangladesh Financial Reporting Standard 10: Consolidated Financial Statements. The consolidated as
well as separate financial statements are prepared for a common financial year ended on December 31, 2017.

Consolidated financial statements and separate financial statements of the Bank comprise of Balance Sheet, Profit and Loss
Statement, Cash Flow Statement, Statement of Changes in Equity, Liquidity Statement and relevant notes and disclosures.

2.5.1 Subsidiaries of the Bank

A subsidiary company is one in which the parent company, Bank Asia Limited owns majority of its shares. As an owner of the
subsidiary, the Bank controls the activities of the subsidiary. Bank Asia Limited has three subsidiary companies as detailed below:
Date of
Country of Year
Name of Subsidiary Ownership Commercial Status Regulator
Operation Closing
Operation
Bank Asia Securities Limited 99.99% 17.04.2011 Bangladesh Majority BSEC, Bangla- 31
Owned desh December
BA Exchange Company (UK) 100% 16.05.2011 United Kingdom Fully Owned FSA, UK 31
Limited December
BA Express USA inc 100% 01.06.2014 United States of Fully Owned NYSDFS, New 31
America York December

2.6 Cash flow statement

Cash Flow Statement is prepared principally in accordance with BAS 7 “Statement of Cash Flows” under the guidelines of BRPD
circular no.14 dated 25 June 2003. The Cash Flow Statement shows the structure of and changes in cash and cash equivalents
during the year.Cash Flows during the year have been classified as operating activities, investing activities and financing activities.

2.7 Statement of changes in equity

Statement of Changes in Equity has been prepared in accordance with BAS 1 “Presentation of Financial Statements” and
following the guidelines of Bangladesh Bank BRPD circular no.14 dated 25 June 2003.
3 SIGNIFICANT ACCOUNTING POLICIES
The accounting policies set out below have applied consistently to all the periods presented in these financial statements and
have been applied consistently by the Bank.
3.1 Assets and basis of their valuation
3.1.1 Cash and cash equivalents
Cash and cash equivalents include cash in hand and balances with Bangladesh Bank and its agent bank, balances with other
banks and financial institutions, money at call and on short notice and prize bonds.
3.1.2 Investments
Investment in securities
All investments in securities (bills and bonds) are initially recognized at purchase price excluding commission and accrued coupon
interest. Investments are segregated in two broad categories. These are held to maturity (HTM) and held for trading (HFT).
Held to maturity
Debt securities that a firm has intention to hold until maturity. These are reported at amortized cost therefore, they are not
affected by swings in the financial markets.
Held for trading
Held for trading securities are those which are held with intention of selling in order to generate profits. Held for trading securities
are revalued at market price.
Revaluation
As per Bangladesh Bank DOS circular letter no. 5 dated 28 January 2009, HFT securities are revalued each week using Marked to
Market concept and HTM securities are amortized once a year according to Bangladesh Bank guidelines. The HTM securities are

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272
Notes to the
financial statements
also revalued if these are reclassified to HFT category with the Board approval. Value of investment has been shown as under:

Government treasury bills and

At present value (using marked to market concept)
bonds (HFT)
Government treasury bills and
At present value (using amortisation concept)
bonds (HTM)
Zero coupon bonds At present value (using amortisation concept)
Prize bonds and other bonds At cost
Debentures At cost
Unquoted shares (ordinary) At cost (as per BRPD circular 14 dated June 25, 2003 )
At cost (provision made for any shortfall arising due to reduce market price
Quoted shares (ordinary)
from cost price)
3.1.3 Investment in listed securities
These securities are bought and held primarily for the purpose of selling them in future or held for dividend income which are
reported at cost. Unrealised gains are not recognised in the profit and loss statement. But provision was made for diminution in
value of investment.
3.1.4 Investment in unquoted securities
Investment in unlisted securities is reported at cost under cost method. Adjustment is given for any shortage of book value over
cost for determining the carrying amount of investment in unlisted securities.
As per Bangladesh Bank DOS Circular # 04 dated 24 November 2011, provision for diminution in value of investment was made by
netting off unrealilsed gain/ loss of shares from market price/ book value less cost price.
Besides, bank complied with Bangladesh Bank BRPD Circular 14 dated June 25, 2003 as follows, “All investments in shares and
securities (both dealing and investment) should be revalued at the year- end. The quoted shares should be valued as per market
price in the stock exchange(s) and unquoted shares as per book value of last audited balance sheet. Provision should be made for
any loss arising from diminution in value of investments.”
3.1.5 Investment in subsidiary
Investment in subsidiary is accounted for under the cost method of accounting in the Bank’s financial statements in accordance
with the BAS 27 “Consolidated and Separate Financial Statements”, BFRS 3 “Business Combination”, BFRS 36 “Impairment of
Assets” and BFRS 10 “Consolidated Financial Statements”.

3.1.6 Loans and advances/investments

a) Loans and advances/investments are stated in the balance sheet on gross basis.
b) Interest/profit is calculated on daily product basis, but charged and accounted for quarterly on accrual basis. Interest/
profit on classified loans and advances/investments is kept in interest suspense account as per BRPD circulars no. 14 dated
September 23, 2012 on Master Circular: Loan Classification and Provisioning. Interest/ profit is not charged on bad and
loss loans and advances/ investments as per guidelines of Bangladesh Bank. Records of such interest amounts are kept in
separate memorandum accounts.
c) Commission and discounts on bills purchased and discounted are recognised at the time of realisation.
d) Provision for loans and advances/investments is made based on the arrear in equivalent month and reviewed by the
management following instructions contained in Bangladesh Bank BRPD circulars/letters no. 16 dated 06 December 1998,
9 dated 14 May 2001, 9 and 10 dated 20 August 2005, 8 dated 07 August 2007, 10 dated 18 September 2007, 14 dated 23
September 2012, 19 dated 27 December 2012, 5 dated 29 May 2013, 16 dated 18 November 2014, 8 dated 02 August 2015, 12
dated 20 August 2017, 15 dated 27 September 2017, 01 dated 03 January 2018, 01 dated 20 February 2018.

Rates of provision on loans and advances/investments are given below:

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 Notes to the
financial statements
Provision
Types of loans and advances
STD SMA SS DF BL
House finance 1% 2% 20% 50% 100%
Consumer Loans for professionals 2% 2% 20% 50% 100%
Other than housing finance & professionals to setup business 5% 5% 20% 50% 100%
Provision for loan to broker house, merchant banks, stock dealers, etc 2% 2% 20% 50% 100%
Short-term agri-credit and micro credit 1% 1% 5% 5% 100%
Small and medium enterprise finance 0.25% 0.25% 20% 50% 100%
Others 1% 1% 20% 50% 100%

In line with Bangladesh Bank BRPD Circular no. 04 dated January 29, 2015, All restructured loans treated as Special Mention
Account (SMA) for the purpose of classification. Provision was made at existing applicable rate of SMA with additional 1%.
e) Loans and advances/investments are written off as per guidelines of Bangladesh Bank. These write off however will not
undermine/affect the claim amount against the borrower. Detailed memorandum records for all such write off accounts are
meticulously maintained and followed up.
f) The Bangladesh Bank under its inspection based on 31 December 2017 suggested to keep extra provision against stay order and
other loans amounting Tk. 19,205.17 Lac, out of which Tk. 3,205.00 Lac has been kept in the year 2017, rest of the amount along
with carrying from 2016 will be kept Tk. 15,501.17 lac in 2018, Tk. 7000.00 lac in 2019 and Tk. 7000.00 lac in 2020.
g) The Bank has restructured (Large loan restructure) certain loan facilities of M/s. Samannaz Super Oil Limited, S. A. Oil Refinery
Limited, Abdul Monem Sugar Refinery Limited and Shinepukur Ceramics Limited under BRPD Circular No. 04 dated 29 January
2015 for an aggregate amount of Tk. 4,243.02 million as per the terms and conditions of the said circular.
h) In stay order cases the unclassified loans and advances include certain customer accounts with an aggregate outstanding amount
of Tk. 8,581.80 million which have not been reported under classification as at 31 December 2017 on the basis of stay order from
the Honorable High Court Division of the Supreme Court of Bangladesh. An aggregate amount of Tk. 2,349.00 million has been
kept as general provision against those customers.

3.1.7 Impairment of financial assets

An asset is impaired when its carrying value exceeds its recoverable amount as per BAS 36 “Impairment of Assets”. At each balance
sheet date, Bank Asia Limited assesses whether there is objective evidence that a financial asset or a group of financial assets i.e,
loans and advances, off balance sheet items and investments is impaired. A financial asset or group of financial assets is impaired and
impairment losses are incurred if -
there is objective evidence of impairment as a result of a loss event that occurred after the initial recognition of the asset up to the
balance sheet date;

the loss event had an impact on the estimated future cash flows of the financial asset or the group of financial assets; and
a reliable estimate of the loss amount can be made.

In the event of impairment loss, the Bank reviews whether a further allowance for impairment should be provided in the profit and
loss statement in addition to the provision made based on Bangladesh Bank guidelines or other regulatory requirements.
3.1.8 Property, plant and equipment
Recognition and measurement
All fixed assets are stated at cost less accumulated depreciation as per BAS 16 “Property, Plant and Equipment”. Land is measured at
cost.
The cost is the amount of cash or cash equivalents paid or the fair value of the other consideration given to acquire an asset at
the time of its acquisition or construction or, where applicable, the amount attributed to that asset when initially recognised in
accordance with the specific requirements of the BFRS.
The cost of an item of property, plant and equipment is recognised as an asset if-
it is probable that future economic benefits associated with the item will flow to the entity; and the cost of the item can be measured
reliably.
The cost of an items of property, plant and equipement comprises:

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(a) its purchase price, including import duties and non- refundable purchase taxes, after deducting trade discounts and rebates

(b) any costs directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in
the manner intended by management

(c) the initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located, the
obligation for which an entity incurs either when the item is acquired or as a consequence of having used the item during a
particular period for purpose other than to produce inventories during that period.

Subsequent costs
The cost of replacing part of an item of fixed assets is recognised in the carrying amount of the item if it is probable that the
future economic benefits embodied within the part will flow to the company and its cost can be measured reliably. The carrying
amount of the replaced part is derecognised. The costs of the day-to-day servicing of fixed assets are recognised in profit or loss
as incurred.

Depreciation
No depreciation is charged on land. Depreciation is charged on straight-line method. Charging depreciation against fixed
assets commences from the month of acquisition (for full month) and ceases at the month when the assets are disposed. Asset
category-wise depreciation rates are as follows:
Category of assets Rate of depreciation
Building 5%
Furniture and fixtures 20%
Equipment 20%
Computers and accessories 20%
Motor vehicles 20%
Gain or loss on sale of fixed assets is recognised in profit and loss statement as per provision of BAS 16 “Property, Plant and
Equipment”.

Construction work in progress/Building under Construction

Building under construction is recognized and reported under Fixed Assets as per BAS 16 “ Property, Plant and Equipment” as
Construction work in progress until the construction work is completed and the assets is ready for intended use. This asset is
stated at cost and depreciation of the asset will be charged from the date of its intended use.

Intangible Asset
a. Goodwill
Goodwill that arises upon the acquisition of subsidiaries is included in intangible assets. Acquisitions of Minority interest (non-
controlling interest) are accounted as transactions with equity holders in their capacity as equity holders and therefore no goodwill is
recognised as a result of such transactions. Subsequently goodwill is measured at cost less accumualted Impairment Losses.

b. Software
Software acquired by the Bank is stated at cost less accumualted amortisation and accumulated impairment losses.

c. License
Value of license is recognised at cost and since it has an indefinite useful life it is not amortized. The value of the license is not
measured at fair value.

3.1.9 Leased assets

Where property, plant and equipment have been financed by lease arrangement under which substantially all the risks and
rewards of ownership are transferred to the lessees are treated as finance leases as per BAS 17 “Leases”. All other leases are
classified as operating leases as per BAS 17 “Leases”.
Assets held under finance lease are recognised as assets of the Bank at their fair value at the date of acquisition or if lower, at
the present value of the minimum lease payments. The corresponding liability to the lessor is included in the balance sheet as a
finance lease obligation.

Assets held under finance lease are depreciated over their expected useful lives on the same basis as owned assets.

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3.1.10 Impairment of fixed assets

At each balance sheet date, the Bank assesses whether there is any indication that the carrying amount of an asset exceeds
its recoverable amount. An asset is carried at more than its recoverable amount if its carrying amount exceeds the amount to
be recovered through use or sale of the asset. If this is the case, the asset is described as impaired and an impairment loss is
recognised as an expense in the profit and loss statement unless the asset is carried at revalued amount in accordance with
Bangladesh Accounting Standard (BAS) 16, Property, Plant and Equipment in which case any impairment loss of a revalued
asset should be treated as a revaluation decrease under that Accounting Standard. No impairment loss was recognized up to the
reporting period as there were no such indication existed as on Balance Sheet date.

3.1.11 Investment properties

a) Investment property is held to earn rentals or for capital appreciation or both and the future economic benefits that are
associated with the investment property but not held for sale in the ordinary course of business.

b) Investment property is accounted for under cost model in the financial statements. Accordingly, after recognition as an asset,
the property is carried at its cost, less accumulated depreciation and accumulated impairment loss.

3.1.12 Other assets

Other assets include all other financial assets and include fees and other unrealised income receivable, advance for operating
and capital expenditure and stocks of stationery and stamps.

3.1.13 Inventories
Inventories are measured at the lower of cost and net realisable value.

3.2 Liabilities and provisions

3.2.1 Borrowings from other banks, financial institutions and agents
Borrowings from other banks, financial institutions and agents include interest-bearing borrowings redeemable at call and
Bangladesh Bank refinance. These items are brought to financial statements at the gross value of the outstanding balance.

3.2.2 Deposits and other accounts

Deposits and other accounts include non interest-bearing current deposit redeemable at call, bills payable, interest bearing on
demand and special notice deposits, savings deposit, fixed deposit and scheme deposit. These items are brought to financial
statements at the gross value of the outstanding balance.

3.2.3 Other liabilities

As per BAS 37 “Provisions, Contingent Liabilities and Contingent Assets” the Bank recognises provisions only when it has a
present obligation as a result of a past event and it is probable that an outflow of resources embodying economic benefits will be
required to settle the obligation and when a reliable estimate of the amount of the obligation can be made.

Other liabilities comprise items such as provision for loans and advances/investments, provision for taxes, interest payable,
interest suspense, accrued expenses, obligation under finance lease etc. Other liabilities are recognised in the balance sheet
according to the guidelines of Bangladesh Bank, income tax laws and internal policy of the Bank.

3.3 Capital/shareholders’ equity

Authorised capital
Authorised capital is the maximum amount of share capital that the Bank is authorised by its Memorandum and Articles of
Association.
Paid-up capital
Paid up capital represents total amount of share capital that has been paid in full by the ordinary shareholders. Holders of
ordinary shares are entitled to receive dividends as declared from time to time and are entitled to vote at shareholders’ meetings.
In the event of winding-up of the company, ordinary shareholders rank after all other shareholders and creditors and are fully
entitled to receive any residual proceeds of liquidation.
Statutory reserve
Statutory reserve has been maintained @ 20% of profit before tax in accordance with provisions of section 24 of the Bank
Company Act 1991 (amended up to 2018) until such reserve equal to its paid-up capital together with the share premium.
Statutory reserve transferred in yearly basis.

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Revaluation reserve
Revaluation reserve arises from the revaluation of Treasury bills and bonds (HFT and HTM) in accordance with the Bangladesh
Bank DOS circular no. 5 dated 26 May 2008. The tax effects on revaluation gain are measured and recognised in the financial
statements as per BAS 12: Income Taxes.
When an fixed asset’s carrying amount is increased as a result of revaluation, the increased amount has been credited directly to
equity under the head of revaluation reserve as per BAS 16 “ Property, Plant and Equipment”. The revaluation surplus included in
equity transferred directly to retained earnings with the amount of the surplus from the difference between depreciation based
on the revalued carrying amount of the asset and depreciation based on the asset’s original cost as per the para 41 of BAS 16.
Non-controling (minority) interest
Minority interest (non-controling interest) in business is an accounting concept that refers to the portion of a subsidiary
company’s stock that is not owned by the parent company. The magnitude of the minority interest in Bank Asia Securities
Limited, a majority owned subsidiary (99.99%) of Bank Asia Limited is very insignificant. Minority interest belongs to a sponsor
Director of the Bank and is reported on the consolidated balance sheet to reflect the claim on assets belonging to the other non-
controlling shareholder. Also, minority interest is reported on the consolidated income statement as a share of profit belonging to
the minority shareholder.
3.4 Contingent liabilities
Any possible obligation that arises from past events and the existence of which will be confirmed only by the occurrence or non-
occurrence of one or more uncertain future events not wholly within the control of the Bank; or any present obligation that arises
from past events but is not recognised because:
- it is not probable that an outflow of resources embodying economic benefits will be required to settle the obligation; or
- the amount of the obligation cannot be measured with sufficient reliability.
Contingent liabilities are not recognised but disclosed in the financial statements unless the possibility of an outflow of resources
embodying economic benefits is reliably estimated.
Contingent assets are not recognised in the financial statements as this may result in the recognition of income which may never
be realised.
3.5 Memorandum items
Memorandum items are maintained for those items for which the Bank has only a business responsibility and no legal
commitment.
3.6 Revenue recognition
Interest income
Interest on loans and advances is calculated on daily product basis, but charged and accounted for on quarterly basis. Interest
on loans and advances ceases to be taken into income when such advances fall under classification. It is then kept in interest
suspense account. Interest on classified loans and advances is accounted for on a cash receipt basis.

Profit on investment (Islamic Banking)

Mark-up on investment is taken into income account proportionately from Unearned Income account. Income/compensation on
classified investments is transferred to profit/rent/compensation/suspense account instead of income account.
Investment income
income on investments is recognised on accrual basis. Investment income includes discount on treasury bills and zero coupon
bonds, interest on treasury bonds, debentures and fixed deposits with other banks. Capital gain on investments in shares and
dividend on investment in shares are also included in investment income.
Interest and fees receivable on credit cards
Interest and fees receivable on credit cards are recognised on accrual basis. Interest and fees ceases to be taken into income when the
recovery of interest and fees is in arrear for over three months. Thereafter, interest and fees are accounted for on cash basis.
Fees and commission income
The Bank earns fees and commissions from diverse range of services provided to its customers. This includes fees and
commission income arising on financial and other services provided by the Bank including trade finance, credit cards, debit
cards, passport endorsement, loan processing, loan syndication and locker facilities, etc. Fees and commission income is
recognised on the basis of realisation.
Dividend income on shares
As per BAS 18 “Revenue”, dividend income from investment in shares is recognised when the Bank’s right to receive dividend is
established. It recognised when:
a. It is probable that the economic benefits associated with the transaction will flow to the entity; and
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b. the amount of the revenue can be measured reliably.
Interest paid on borrowing and other deposits (conventional banking)
Interest paid and other expenses are recognised on accrual basis.
Profit paid on deposits (Islamic Banking)
Profit paid to mudaraba deposits is recognised on accrual basis according to Income Sharing Ratio (ISR).
Other operating expenses
All other operating expenses are provided for in the books of the account on accrual basis according to the BAS 1 “Presentation of
Financial Statements”.
3.7 Employee benefits
3.7.1 Provident Fund
Provident fund benefits are given to the staff of the Bank in accordance with the approved provident fund rules. The fund is
operated by a Board of Trustees. All confirmed employees of the Bank are contributing 10% of their basic salary as subscription of
the fund. The Bank also contributes equal amount of the employees’ contribution to the fund.
3.7.2 Gratuity Fund
Gratuity fund benefits are given to the eligible staff of the Bank in accordance with the approved gratuity fund rules. Gratuity
payable is determined on the basis of existing rules and regulations of the Bank and actuarial valuation.
3.7.3 Superannuation and Benevolent Fund
The Bank operates a superannuation and a benevolent fund. Superannuation fund for its employees to pay a lumpsum amount
on retirement or death. The bank also operates a benevolent fund to provide one time financial assistance to its employees in
the event of disability caused by any accident or disease. In case of superannuation fund the bank pays Tk. 610,000 per month
as per actuarial valuation and in case of benevolent fund Tk. 200 is deducted from salary per month per employee. The funds are
operated by separate Board of Trustees.
3.7.4 Hospitalisation insurance
The Bank operates a health insurance scheme to its confirmed employees and their respective spouses and children at rates
provided in health insurance coverage policy.
3.7.5 Worker’s Profit Participation Fund
Consistent with the industry practice and in accordance with the Banking Companies Act, 1991, no provision has been made to WPPF

3.8 Provision for off-balance sheet exposures

In compliance with Bangladesh Bank guidelines off-balance sheet items have been disclosed under contingent liabilities. As per
BRPD circular no. 10 dated 18 September 2007, the Bank is required to maintain provision @ 1% against off-balance sheet exposures.

3.9 Provision for nostro accounts

According to guidelines of Foreign Exchange Policy Department of Bangladesh Bank, circular no. FEOD (FEMO)/01/2005-677 dated 13
September 2005, Bank is required to make provision regarding the un-reconciled debit balance as at balance sheet date.
3.10 Taxation
Income tax expense comprises current and deferred tax. Current tax and deferred tax are recognised in profit or loss except to the
extent that it relates to items recognised directly in equity.
Current tax
Current tax is the expected tax payable or receivable on the taxable income or loss for the period, using tax rates enacted or
substantively enacted at the reporting date, and any adjustment to tax payable in respect of previous years.
Deferred tax
Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets and liabilities for financial
reporting purposes and the amounts used for taxation purposes. Deferred tax is not recognised for the temporary differences
relating to the initial recognition of goodwill, the initial recognition of assets or liabilities in a transaction that is not a business
combination and that affects neither accounting nor taxable profit or loss, and differences relating to investments in subsidiaries
to the extent that it is probable that they will not reverse in the foreseeable future. Deferred tax is measured at the tax rates
that are expected to be applied to the temporary differences when they reverse, based on the laws that have been enacted or
substantively enacted by the reporting date. Deferred tax assets and liabilities are offset if there is a legally enforceable right to

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offset current tax liabilities against current tax assets, and they relate to income taxes levied by the same tax authority on the
same taxable entity, or on different tax entities, but they intend to settle current tax liabilities and assets on a net basis or their tax
assets and liabilities will be realised simultaneously.
A deferred tax asset is recognised for unused tax credits and deductible temporary differences to the extent that it is probable that
future taxable profits will be available against which they can be utilised. Deferred tax assets are reviewed at each reporting date
and are reduced to the extent that it is no longer probable that the related tax benefit will be realised.
Deferred tax relating to unrealised surplus on revaluation of held to maturity (HTM) securities is recognised directly in revaluation
reserve as a part of equity and is subsequently recognised in profit and loss statement on maturity of the security.
3.11 Earnings Per Share
Earnings per share (EPS) has been computed by dividing the basic earnings by the weighted average number of ordinary shares
outstanding at 31 December 2017 as per Bangladesh Accounting Standard (BAS) - 33 “Earnings Per Share”. EPS for comparative
period also restated by the bonus share issued for the year 2016. Details are in note 37.
Basic earnings
This represents earnings for the year attributable to ordinary shareholders. Net profit after tax has been considered as fully
attributable to the ordinary shareholders.
Weighted average number of ordinary shares
This represents the number of ordinary shares outstanding at the beginning of the year plus the number of ordinary shares issued
during the year.
The basis of computation of number of shares is in line with the provisions of BAS 33 “Earnings per share”. The logic behind this
basis is, that the bonus shares are issued to the existing shareholders without any consideration, and therefore, the number of
shares outstanding is increased without an increase in resources generating new earnings.
Diluted earnings per share
No diluted earnings per share is required to be calculated for the year as there was no scope for dilution during the year under
review. It is pertinent to mention that, potential ordinary shares is in convertible subordinate bond that may entitle their holders
to ordinary shares.
3.12 Reconciliation of inter-bank/inter-branch account
Books of account with regard to inter-bank (in Bangladesh and outside Bangladesh) are reconciled on monthly basis and there
are no material differences which may affect the financial statements significantly.
Un-reconciled entries in case of inter-branch transactions as at the reporting date are not material.
3.13 Risk Management at Bank Asia Ltd.
Being a financial institution, in the ordinary course of business, the bank is sensitive to verities of risks. The generic severity of
such risk(s) is much intense in our locality due to presence of large number of banks and complex financial transactions. In such
highly competitive environment to ensure a bank’s consistent system and performance, the presence of strong Risk Management
culture is obligatory.

The Board of Director and Senior Management of the bank need to remain positive toward adaptation of active risk management
culture throughout the bank. Such awareness (risk) has helped the bank to do more than just regulatory compliance as far as risk
management practice is concerned, the consequence of such initiatives has helped the bank to safeguard valuable capital and
ensure consistent profitability, through avoiding excessive credit, market and operation loss and inadequate capital allocation
under Basel III. Being compliant, the bank is now looking forward to take risk management practice to a different level, i.e.
preventing risk before occurrence rather than a reactive manner; on a proactive basis.
As a part of regulatory and global benchmarking the bank has based upon 06 (six) core risks guidelines of Bangladesh Bank and
Basel framework. Listed below are the identified risks the bank is currently managing or intents to manage in the future:

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Sl Core Risk Guideline of BB Basel Accord Pillar

1 Credit Risk Credit Risk Pillar - I & II
2 Foreign Exchange Risk Market Risk Pillar - I & II
3 Asset Liability Risk Operational Risk Pillar - I & II
4 Money Laundering Risk Residual Credit Risk Pillar - II
5 Internal Control & Compliance Risk Residual Risk (CRM) Pillar –II
6 Information and Communication Technology Risk Residual Market Risk – Equity Pillar –II
7 Residual Market Risk - Currency Pillar –II
8 Credit Concentration Risk Pillar –II
9 Liquidity Risk Pillar –II
10 Interest Rate Risk in Banking Book Pillar –II
11 Settlement Risk Pillar –II
12 Reputation Risk Pillar –II
Environmental and climate change
13 Pillar –II
risk
14 Strategic Risk Pillar –II
15 Pension Obligation Risk Pillar –II
16 Compliance Risk Pillar –II

In view of core risk guideline the bank has established various departments to address specific risks, e.g. credit risk management,
credit admin, internal control and compliance department, anti-money laundering department etc. Further to manage the
overall risks of the bank in line of Basel the bank has formed a dedicated Risk Management Division.
Accordingly the bank has various high powered committees to monitor and ensure smooth risk management activities.
The current risk management framework of the bank is as follow:
Credit Risk Management: Credit risk can be defined as risk of failure of customer/counterparty of the bank to meet financial
obligations. Another major source of credit risk could be concentration risk, which arises when a bank’s credit portfolio tend to
be non diversified i.e. large single borrower exposure or lending exposure to clients having similar economic factors (single sub-
sector, industry, geographic region etc) that would adversely impact the repayment ability of mass obligor during any possible
economic downturn.
To ensure the portfolio health, the bank has distributed the overall credit concentration among different segments/industry/
trading. For example, branches are primarily responsible for sourcing of potential clients and initiate limit (credit) approval
process for review of Credit Risk Management Division (CRMD), this division (CRMD) ensure the quality of credit proposal before
limit approval, a separate division known as Credit Administration (CAD) monitors the documentation aspects of approved
credits and finally the Legal Recovery Department manages the deteriorating accounts. It is mentionable that the bank has own
credit risk management guideline.
All other remaining risk in regards to credit portfolio are addressed by the Risk Management Division (RMD), the primary
responsibility of this Division is to identify and assess the severity of risks and highlight the same to the management for strategic
decision making. Below are risk wise list of few global model that RMD is currently using or intends to use in the future:
Residual Risk (e.g. wrong valuation of collateral, docu- Capital computation under Pillar –II using the foundation Internal
mentation error etc) Rating Based (FIRB) approach
Concentration Risk Herfindahl-Hirschman Index ( HHI) index
Foreign Exchange Risk Management: The Foreign Exchange Risk arises from transaction involvement in any other national
currency. Providing major foreign exchange related transactions are carried out on behalf of client thus bank has minimal
exposure to the captioned risk. It is mentionable that the bank do not involve in any speculative transactions.
The treasury division independently conducts the transactions and back office is responsible for verifying the deal and passes
necessary accounting entries. As advised by Bangladesh Bank on month end all foreign exchange related transactions are
revalued at mark-to-market rate. All Nostro accounts are reconciled on daily basis and outstanding entries beyond 30 days are
reviewed by management for settlement. It is mentionable that bank management is looking forward to establish treasury mid
office to effectively perform the reconciliation activities.
At present Bank assess daily Value-at-Risk (VaR) based on exponential weighted average method using web based platform for
foreign exchange risk more effectively.

Asset Liability Management: The Asset Liability Risk is comprises of Balance Sheet Risk and liquidity risk. The Balance Sheet
risk refers to risk of change in earning and/or devaluation of asset due to interest rate movement. The liquidity risk can be defined
as the risk or chance of failure to meet up any withdrawal/disbursement request by a counterparty/client. ALCO reviews liquidity
requirements of the Bank, maturity of assets and liabilities, deposit and lending pricing strategy and the liquidity contingency
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plan. The Asset Liability Committee also monitors balance sheet risk.

Risk assessment tools in regards to ALM risk management are as follow:

Equity investment risk Value-at-risk (VaR) on equity position
Liquidity Coverage Ratio (LCR)
Liquidity Risk Net Stable Funding Ratio (NSFR)
Stress Testing (Duration)
Interest Rate Risk Assessment of Interest Rate Risk in Banking Book

Prevention of Money Laundering: Money laundering risk is defined as the loss of reputation and expenses incurred as penalty
for being negligent in prevention of money laundering. For mitigating the risks, the Bank has nominated a Chief Compliance
Officer at Corporate Office and Branch Compliance Officers at branches, who independently review the accounting transactions
to locate and verify suspicious transactions. Know Your Customer (KYC) policy and Transaction Profile (TP) format have been
introduced. The regulatory requirements are being complied with and the guidelines in respect of KYC are being followed for
opening of new accounts. Training is being provided continuously to all the categories of executives and officers for developing
awareness and skill for identifying suspicious activities.

Ensuring internal control and compliance: Operational loss arising from error and fraud due to lack of proper internal control
and compliance. Internal Control and Compliance Department undertakes periodical and special audit and inspection of the
branches and departments at corporate office for identifying and reviewing the operational lapses and compliance of statutory
requirements as well as Bank’s own guidelines. The Audit Committee of the Board reviews the audit and inspection reports
periodically and provides necessary instructions and recommendations for rectifications of lapses and observations identified by
the audit team.

Further to above the bank is in the process of developing various globally recognized operational risk identification processes
through the Risk Management Division. For example adaptation of

Risk Control Self Assessment (RCSA) for assessing all possible operational risks based on operational process review and previous
experiences before occurrence of any such event.

Using the Key Risk Indicator (KRI) approach to identify operational risk trigger points.

Managing Information and communication Technology Risk : Bank Asia Limited follows the guideline stated in DFIM circular
no. 6 dated 21 June 2010 regarding “Guideline on ICT Security for Banks and Financial Institutions, April 2010”. IT management
deals with IT policy documentation, internal IT audit, training etc. The core objective of IT management is to achieve the highest
levels of technology service quality and minimize possible operational risk. Physical security involves providing environmental
safeguards as well as controlling physical access to equipment and data. IT department has controls over Password, User ID
maintenance, input control, network security, virus protection, internet and e-mail. Data centre has been set up and disaster
recovery plan has been formulated as part of Business Continuity Planning (BCP).

All other risk management: These are risks that are not directly covered by core risk guidelines of Bangladesh Bank, more
precisely additional risk under Basel III. The Risk Management Division is primarily responsible for assessing and developing
controls for managing these risks. In order to do so the RMD of the bank is performing various exercises, for example, Minimum
Capital Requirement (MCR) is assessed on quarterly basis, Stress Testing to assess the sensitivity of the bank against adverse
scenarios is performed, additional capital (on top of MCR under Pillar –II) will be assessed using a model namely (currently in the
process of development) Internal Capital Adequacy Assessment Process (ICAAP), Supervisory Review Process (SRP) is performed
by the bank as per Bangladesh Bank requirement.

On top of assessment the RMD of the bank is reporting these risks to senior management (through BRMC); which are ultimately
aiding the bank to allocate adequate capital in line with Basel III requirement and at the same time implant active strategies to
precisely manage all potential risks of the bank.

3.14 Events after reporting period

As per BAS -10 “Events after Reporting Period” are those events, favourable and unfavourable, that occur between the end of the
reporting period and the date when the financial statements are authorised for issue. Two types of events can be identified:

(a) those that provide evidence of conditions that existed at the end of the reporting period (adjusting events after the reporting

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period); and
(b) those that are indicative of conditions that arose after the reporting period (no adjusting events after the reporting period).

3.15 Related party disclosures

A party is related to the company if:
(i) directly or indirectly through one or more intermediaries, the party controls, is controlled by, or is under common control with,
the company; has an interest in the company that gives it significant influence over the company; or has joint control over the
company;
(ii) the party is an associate;
(iii) the party is a joint venture;
(iv) the party is a member of the key management personnel of the Company or its parent;
(v) the party is a close member of the family of any individual referred to in (i) or (iv);
(vi) the party is an entity that is controlled, jointly controlled or significantly influenced by or for which significant voting power in
such entity resides with, directly or indirectly, any individual referred to in (iv) or (v); or
(vii) the party is a post-employment benefit plan for the benefit of employees of the company, or of any entity that is a related
party of the company.

3.16 Directors’ responsibilities on statement

The Board of Directors takes the responsibilities for the preparation and presentation of these Financial Statements.

3.17 Segment Reporting

As per BFRS 8 “Operating Segments”, is a component of an equity:
(a) that engages in business activities from which it may earn revenues and incur expenses (including revenues and expenses
relating to transactions with other components of the same entity)
(b) whose operating results are regularly reviewed by the entity’s chief operating decision maker to make decisions about
resources to be allocated to the segment and assess its performances, and
(c) for which discrete financial information is available.

Bank reported its segments in respect of business segment and geographical segment. Business segments are comprised of
Conventional Banking, Islamic Banking, Off-shore Banking, Bank Asia Securities Limited, BA Exchange Company (UK) Limited
and BA Express USA Inc. Geographical segments report consist of location wise performance of above segments.

3.18 Changes in Accounting Policies

As per BAS 8 “ Accounting Policies, Changes in Accounting Estimates and Errors” Accounting Policies are applied consistently
for comparability between financial statements of different accounting periods. Changes in Accounting Policies are applied
retrospectively in the financial statements. Comparative amounts presented in the financial statements affected by the change in
accounting policy for each prior period presented.

3.19 Compliance checklist of Bangladesh Accounting Standards (BAS)/Bangladesh Financial Reporting Standards (BFRS)
Name of the standards Ref. Status
First-time Adoption of Bangladesh Financial Reporting Standards BFRS-1 N/A
Share Based Payment BFRS-2 N/A
Business Combinations BFRS-3 Complied
Insurance Contracts BFRS-4 N/A
Non-current Assets Held for Sale and Discontinued Operations BFRS-5 N/A
Exploration for and Evaluation of Mineral Resources BFRS-6 N/A
Financial Instruments: Disclosures BFRS-7 Complied
Operating Segments BFRS-8 Complied
Consolidated Financial Statements BFRS-10 Complied
Joint Arrangements BFRS-11 N/A
Disclosure of Interests in other entities BFRS-12 N/A
Fair Value Measurement BFRS-13 Partially
Complied
Presentation of Financial Statements BAS-1 Complied
Inventories BAS-2 Complied

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Name of the standards Ref. Status
Statement of Cash Flows BAS-7 Complied
Accounting Policies, Changes in Accounting Estimates and Errors BAS-8 Complied
Events after the Reporting Period BAS-10 Complied
Construction Contracts BAS-11 Complied
income Taxes BAS-12 Complied
Property, Plant and Equipment BAS-16 Complied
Leases BAS-17 Complied
Revenue BAS-18 Complied
Employee Benefits BAS-19 Complied
Accounting for Government Grants and Disclosure of Government Assistance BAS-20 N/A
The Effects of Changes in Foreign Exchange Rates BAS-21 Complied
Borrowing Costs BAS-23 Complied
Related Party Disclosures BAS-24 Complied
Accounting and Reporting by Retirement Benefit Plans BAS-26 N/A
Separate Financial Statements BAS-27 Complied
Investments in Associates and Joint Ventures BAS-28 Complied
Financial Instruments: Presentation BAS-32 Complied
Earnings Per Share BAS-33 Complied
Interim Financial Reporting BAS-34 Complied
Impairment of Assets BAS-36 Complied
Provisions, Contingent Liabilities and Contingent Assets BAS-37 Complied
Intangible Assets BAS-38 Complied
Financial Instruments: Recognition and Measurement BAS-39 Complied
Investment property BAS-40 Complied
Agriculture BAS-41 N/A

3.20 Approval of financial statements

The financial statements were approved by the board of directors on April 08, 2018

3.21 General
(i) Figures relating to the previous year included in this report have been rearranged, wherever considered necessary, to make
them comparable with those of the current year without, however, creating any impact on the operating result and value of
assets and liabilities as reported in the financial statements for the current year.
(ii) Figures in these notes and in the annexed financial statements have been rounded off to the nearest Taka.
(iii) These notes form an integral part of the annexed financial statements and accordingly are to be read in conjunction there-
with.
(iv) These financial statements cover one calender year from 01 January 2017 to 31 December 2017 .

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 Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016
4 Cash
4.1 In hand (including foreign currencies)
Conventional and Islamic banking
Local currency 1,975,567,432 2,059,782,311
Foreign currencies 16,477,295 17,155,946
1,992,044,727 2,076,938,257
Off-shore banking unit - -
1,992,044,727 2,076,938,257

4.1(a) Consolidated Cash in hand

Bank Asia Limited 1,992,044,727 2,076,938,257
Bank Asia Securities Limited 5,742 8,377
BA Exchange Company (UK) Limited 2,727,856 2,853,603
BA Express USA, Inc 200,258 97,179
1,994,978,583 2,079,897,416

4.2 Balance with Bangladesh Bank and its agent bank (including foreign currencies)
Conventional and Islamic banking
Balance with Bangladesh Bank
Local currency (statutory deposit) 15,229,481,310 13,036,708,415
Foreign currencies 109,241,186 391,688,896
15,338,722,496 13,428,397,311
Balance with agent bank (Sonali Bank Limited)
Local currency 599,507,694 475,423,327
Foreign currencies - -
599,507,694 475,423,327
15,938,230,190 13,903,820,638
Off-shore banking unit - -
15,938,230,190 13,903,820,638

4.2(a) Consolidated Balance with Bangladesh Bank and its agent bank (including foreign currencies)
Bank Asia Limited 15,938,230,190 13,903,820,638
Bank Asia Securities Limited - -
BA Exchange Company (UK) Limited - -
BA Express USA, Inc - -
15,938,230,190 13,903,820,638

4.3 Cash Reserve Ratio (CRR) and Statutory Liquidity Ratio (SLR)
Cash Reserve Ratio (CRR) and Statutory Liquidity Ratio (SLR) have been calculated and maintained in accordance with Section 33 of
Bank Company Act 1991, DOS circular nos. 01 dated 19 January 2014 and MPD circular no. 01 dated 23 June 2014.

The statutory Cash Reserve Ratio on the Bank’s time and demand liabilities at the rate 6.5% (both conventional and islamic bank-
ing) has been calculated and maintained with Bangladesh Bank in local currency and 13% (5.5% for Islamic Banking)
Statutory Liquidity Ratio, on the same liabilities has also been maintained in the form of cash in hand, balance with Bangladesh
Bank and its agent bank, treasury bills, bonds and debentures. CRR and SLR maintained by the Bank are shown below:

4.3.1Cash Reserve Ratio (CRR)

Conventional Banking
As per Bangladesh Bank DOS Circular No. 01 dated January 19, 2014 and MPD circular no. 01 dated 23 June 2014, Bank has to main-
tain CRR @ 6.5% on fortnightly cumulative average basis and minimum @ 6% on daily basis.

Bank Asia Limited

284
Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016
i. Daily Bank’s CRR maintenance:
Required reserve (6 % on Demand and Time Liabilities) 11,467,765,770 10,378,190,328
Actual reserve maintained 14,207,565,140 12,496,415,350
Surplus 2,739,799,370 2,118,225,022

ii. Fortnightly Bank’s CRR maintenance:

Required reserve (6.5 % of Demand and Time Liabilities) 12,423,412,918 11,243,039,522
Actual reserve maintained (average) 12,921,504,211 11,523,860,039
Surplus 498,091,294 280,820,517

Islamic Banking
i. Daily Bank’s CRR maintenance:
Required reserve (6% Demand and Time Liabilities) 603,553,389 609,168,438
Actual reserve maintained 657,449,341 668,492,000
Surplus 53,895,952 59,323,562

ii. Fortnightly Bank’s CRR maintenance:

Required reserve (6.5% of Demand and Time Liabilities) 653,849,505 659,932,475
Actual reserve maintained (Average) 657,449,341 669,246,824
Surplus 3,599,836 9,314,349

4.3.2 Statutory Liquidity Ratio (SLR)

Conventional Banking
13% of Average Demand and Time Liabilities
Required reserve 24,846,825,835 22,486,079,044
Actual reserve maintained 28,158,817,000 39,252,494,000
Surplus 3,311,991,165 16,766,414,956

Islamic Banking
5.5% of Average Demand and Time Liabilities
Required reserve 553,257,273 558,404,402
Actual reserve maintained 595,836,000 595,204,000
Surplus 42,578,727 36,799,598
3,354,569,892 16,803,214,554

4.3.3 Held for Statutory Liquidity Ratio

Conventional Banking
Cash in hand 1,950,308,000 2,054,894,000
Excess of CRR - Balance with Bangladesh Bank 1,784,152,000 1,253,376,000
Balance with agent bank (Sonali Bank Limited) 543,602,000 396,351,000
Government securities 23,879,074,900 35,544,782,200
Other securities 1,680,100 3,090,800
28,158,817,000 39,252,494,000
Islamic Banking
Cash in hand 41,737,000 22,045,000
Excess of CRR - Balance with Bangladesh Bank 3,599,000 8,559,000
Government securities 550,500,000 564,600,000
595,836,000 595,204,000
28,754,653,000 39,847,698,000

Annual Integrated Report 2017

285
 Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016
5. Balance with other banks and financial institutions
In Bangladesh
Conventional and Islamic banking (Note 5.1) 28,766,652,560 10,702,481,995
Off-shore banking unit - -
28,766,652,560 10,702,481,995

Outside Bangladesh
Conventional and Islamic banking (Note 5.2) 802,548,570 1,066,474,297
Off-shore banking unit 33,810,259 1,504,277,184
836,358,829 2,570,751,481
29,603,011,389 13,273,233,476

5.1 Conventional and Islamic banking-In Bangladesh

Current accounts
AB Bank Limited 41,480 41,480
Agrani Bank Limited 6,847 826,280
National Bank Limited 816,024 796,058
Sonali Bank Limited 182,126,501 155,332,208
Standard Chartered Bank 1,943,441 226,677
Jamuna Bank Limited 1,463 2,590
Trust Bank Limited (6,148,777) (37,600,687)
178,786,979 119,624,606
Short- notice deposit accounts
BRAC Bank Limited 1,087,689 730,099
AB Bank Limited 532,105 526,403
Islami Bank Bangladesh Limited 173,529 172,800
Uttara Bank Limited 128,842 85,784
1,922,165 1,515,086
Fixed deposit accounts/ MTDR
Islamic Finance and Investment Limited - 100,000,000
Hajj Finance Company Limited - 100,000,000
Bank Alfalah limited 1,993,416 100,842,303
1,993,416 300,842,303
182,702,560 421,981,995
Placements
With Banking companies 26,583,950,000 10,280,500,000
With Non-banking financial institutions 2,000,000,000 -
28,583,950,000 10,280,500,000
28,766,652,560 10,702,481,995
Details of Placement with Banking companies(Local Currency)
IFIC Bank Limited 5,100,000,000 -
One Bank Limited 4,000,000,000 1,000,000,000
Social Islami Bank Limited 4,000,000,000 1,000,000,000
AB Bank Limited 2,500,000,000 -
Jamuna Bank Limited 2,000,000,000 -
Standard Bank Limited 2,000,000,000 1,000,000,000
Shahjalal Islami Bank Limited 1,750,000,000 1,500,000,000
Bank Asia Islamic Window 1,400,000,000 -
National Bank Limited 1,000,000,000 1,000,000,000
Midland Bank Limited 500,000,000 200,000,000

Bank Asia Limited

286
Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016
Modhumoti Bank Limited 300,000,000 250,000,000
NRB Bank Limited 250,000,000 200,000,000
NRB Global Bank Limited - 200,000,000
BRAC Bank Limited - 750,000,000
Mercantile Bank Limited - 1,000,000,000
Dhaka Bank Limited - 1,000,000,000
24,800,000,000 9,100,000,000
Less: Inter-company transactions with Bank Asia Islamic Window (1,400,000,000) -
23,400,000,000 9,100,000,000
Details of Placement- with Banking companies (Foreign Currencies)
Mutual Trust Bank Limited 1,116,450,000 -
Eastern Bank Limited - 1,180,500,000
AB Bank Limited 827,000,000 -
Mercantile Bank Limited 827,000,000 -
Commercial Bank of Ceylon 413,500,000 -
3,183,950,000 1,180,500,000
26,583,950,000 10,280,500,000
Details of Placement with Non-banking financial institutions
Delta Brac Housing 600,000,000 -
National House Finance and Investment Limited 200,000,000 -
IPDC Finance Limited 500,000,000 -
United Leasing Company 200,000,000 -
Union Capital Limited 500,000,000 -
2,000,000,000 -

5.2 Conventional and Islamic banking- Outside Bangladesh

Current accounts
Interest bearing
Citibank N.A., London (EURO) 24,434,287 20,681,324
Citibank N.A., London (GBP) 9,046,861 3,827,315
Citibank NA, New York (USD) 244,077,093 792,753,215
Habib American Bank, New York 150,820,201 5,134,395
Mashreqbank psc, New York (USD) 18,315,806 580,871
Standard Chartered Bank, Mumbai 4,131,323 102,345,892
Standard Chartered Bank, New York 56,220,625 146,368
507,046,196 925,469,379
Non-interest bearing
AB Bank Limited, Mumbai 38,621,372 14,175
Al Rajhi Bank K.S.A 17,982 919,982
Bhutan National Bank Limited, Thimphu 2,392,802 897,984
Casisse Centrale Desjardins - 621,340
Commerzbank AG, Frankfurt (EURO) 132,965,792 51,744,589
Commerzbank AG, Frankfurt (USD) 943,737 44,236,583
Habib Metropolitan Bank Limited, Karachi 9,754,377 7,928,216
Habib Bank UK, London - 51,274
ICICI Bank Limited, Kowloon 362,987 13,614
ICICI Bank Limited, Mumbai 1,023,138 22,596,745
JP Morgan Chase Bank N.A New York, U.S.A 13,714,038 34,891
Mashreqbank psc, Mumbai (EURO) 790,571 660,420
Muslim Commercial Bank Limited, Colombo 1,629,075 4,200,567

Annual Integrated Report 2017

287
 Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016
Bank of Sydney 784,152 85,845
Nepal Bangladesh Bank Limited, Kathmandu 13,763,471 4,096,072
Sonali Bank (UK) Limited, London - 38,564
Saudi Hollandi K.S.A 5,427,400 30,734
UBAF, Tokyo 18,235,632 48,857
Unicredit Bank AG, Munich (EURO)/Hypovereins Bank, Munich (EURO) 672,514 158,292
Wells Fargo Bank NA, New York, (USD) 53,519,499 28,198
Wells Fargo Bank NA, London, (Euro) 64,571 354,710
Bank Of Tokyo-Mitsubishi , Tokyo (Yen) - 1,467,524
Zurcher Kantonal Bank, Switzerland 819,264 775,743
295,502,374 141,004,918
802,548,570 1,066,474,297
Placement with Off-shore Banking Unit 504,470,000 -
Less: Inter company transaction (504,470,000) -
802,548,570 1,066,474,297

5.3 Maturity grouping of balance with other banks and financial institutions
Up to 1 month 14,741,061,389 5,277,633,476
More than 1 month but not more than 3 months 14,203,150,000 7,335,700,000
More than 3 months but not more than 6 months 658,800,000 -
More than 6 months but not more than 1 year - -
More than 1 year but not more than 5 years - 659,900,000
More than 5 years - -
29,603,011,389 13,273,233,476

5(a) Consolidated Balance with other banks and financial institutions

In Bangladesh
Bank Asia Limited 28,766,652,560 10,702,481,995
Bank Asia Securities Limited 336,215,384 317,381,382
BA Exchange Company (UK) Limited - -
BA Express USA, Inc - -
29,102,867,944 11,019,863,377
Less: Inter-company transactions 15,047,104 36,057,950
29,087,820,840 10,983,805,427
Outside Bangladesh
Bank Asia Limited 836,358,829 2,570,751,481
Bank Asia Securities Limited - -
BA Exchange Company (UK) Limited 54,274,321 5,879,569
BA Express USA, Inc 99,426,462 54,670,895
990,059,612 2,631,301,945
30,077,880,452 13,615,107,372

6. Money at call and on short notice

Call money
With Banking companies (Note 6.1) - 1,320,000,000
With Non-banking financial institutions (Note 6.2) - 3,550,000,000
- 4,870,000,000

Bank Asia Limited

288
Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016
6.1 Call Money- with Banking companies:
NRB Bank Limited - 220,000,000
Midland Bank Limited - 250,000,000
Modhumoti Bank Limited - 250,000,000
Habib Bank Limited - 300,000,000
Jamuna Bank Limited - 300,000,000
- 1,320,000,000

6.2 Call Money- with non Banking financial institutions:

Investment Corporation of Bangladesh - 3,400,000,000
Delta Brac Housing - 150,000,000
- 3,550,000,000

6(a) Consolidated Money at call and on short notice

Bank Asia Limited - 4,870,000,000
Bank Asia Securities Limited - -
BA Exchange Company (UK) Limited - -
BA Express USA, Inc - -
- 4,870,000,000

7. Investments
Government (Note 7.1) 24,431,255,000 36,112,473,144
Others (Note 7.2) 3,114,563,419 3,252,738,881
27,545,818,419 39,365,212,025

7.1 Government
Conventional and Islamic banking (Note 7.1.1) 24,431,255,000 36,112,473,144
Off-shore banking unit - -
24,431,255,000 36,112,473,144

7.1.1 Conventional and Islamic banking

Treasury bills (Note 7.1.1.1) 6,200,555,735 4,020,968,205
Treasury bonds (Note 7.1.1.2) 16,729,386,230 17,311,406,196
Bangladesh Bank bills (Note 7.1.1.3) 1,499,632,935 14,777,007,943
Prize bonds 1,680,100 3,090,800
24,431,255,000 36,112,473,144

7.1.1.1 Treasury bills

91days treasury bills 1,987,575,306 -
182 days treasury bills 4,212,980,429 1,497,929,029
364 days treasury bills - 2,523,039,176
6,200,555,735 4,020,968,205
7.1.1.2 Treasury bonds
Bangladesh Bank Islamic bond 550,500,000 564,600,000
2 years Bangladesh Government treasury bonds 1,991,138,902 -
5 years Bangladesh Government treasury bonds 1,879,928,645 4,504,174,803
10 years Bangladesh Government treasury bonds 6,446,776,045 6,351,312,016
15 years Bangladesh Government treasury bonds 5,618,296,400 5,648,584,142
20 years Bangladesh Government treasury bonds 242,746,238 242,735,235
16,729,386,230 17,311,406,196

Annual Integrated Report 2017

289
 Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016

7.1.1.3 Bangladesh Bank bills

07 days Bangladesh Bank bills 1,499,632,935 -
14 days Bangladesh Bank bills - 4,494,865,500
30 days Bangladesh Bank bills - 10,282,142,443
1,499,632,935 14,777,007,943

7.2 Others
Conventional and Islamic banking (Note 7.2.1) 3,114,563,419 3,252,738,881
Off-shore banking unit 514,046,529 298,995,308
Less: Adjustment with OBU (514,046,529) (298,995,308)
3,114,563,419 3,252,738,881

7.2.1 Conventional and Islamic banking

a) Ordinary shares (Details are shown in Annexure-B)
Quoted shares 478,653,578 614,055,401
Unquoted share 93,839,455 93,575,971
572,493,033 707,631,372

b) Mutual Fund (Details are shown in Annexure-B)

1st Janata Bank Mutual fund 50,000,000 50,000,000
EBL NRB Ist Mutual Fund 149,665,000 149,665,000
Ist Bangladesh Fixed Income Fund 250,000,000 250,000,000
MBL 1st Mutual Fund 50,000,000 50,000,000
EXIM Bank 1st Mutual Fund 242,235,820 247,705,052
UFS-Bank Asia Unit Fund 100,000,000 -
841,900,820 747,370,052

c) Debentures
Beximco Denims Limited 9,537,605 9,537,605
Beximco Textiles Limited 6,445,370 6,445,370
15,982,975 15,982,975

d) Bonds
MTBL subordinated bond - 75,000,000
MTB Second subordinated bond 400,000,000 400,000,000
UCB Second subordinated bond 300,000,000 300,000,000
BSRM Steels Limited zero coupon bond 116,186,591 170,754,482
Premier Bank Non-convert subordinated bond 500,000,000 500,000,000
Prime Bank Limited Coupon bond - 70,000,000
BSRML Coupon bond 44,000,000 66,000,000
7 Year Preference Share Of Summit BPL 64,000,000 -
SIBL subordinated Mudaraba bond 160,000,000 200,000,000
SIBL 2nd Mudaraba Subordinated Bond 100,000,000 -
1,684,186,591 1,781,754,482
3,114,563,419 3,252,738,881

7.3 Investments classified as per Bangladesh Bank circular

Held for trading (HFT) 4,937,574,983 18,797,976,148
Held to maturity (HTM) 18,941,499,917 16,746,806,196
Other securities 3,666,743,519 3,820,429,681

Bank Asia Limited

290
Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016
27,545,818,419 39,365,212,025
7.4 Maturity-wise grouping
On demand 1,160,789,398 14,659,900,000
Up to 3 months 5,090,869,350 218,500,000
More than 3 months but not more than 1 year 4,281,322,451 1,488,000,000
More than 1 year but not more than 5 years 5,616,477,758 2,089,300,000
More than 5 years 11,396,359,462 20,909,512,025
27,545,818,419 39,365,212,025
7(a) Consolidated Investments
Government
Bank Asia Limited 24,431,255,000 36,112,473,144
Bank Asia Securities Limited - -
BA Exchange Company (UK) Limited - -
BA Express USA, Inc - -
24,431,255,000 36,112,473,144
Others
Bank Asia Limited 3,114,563,419 3,252,738,881
Bank Asia Securities Limited 599,531,872 346,594,514
BA Exchange Company (UK) Limited - -
BA Express USA, Inc - -
3,714,095,291 3,599,333,395
28,145,350,291 39,711,806,539

8 Loans and advances/investments

Loans, cash credits, overdrafts, etc/investments (Note 8.1) 181,498,036,483 155,016,374,171
Bills purchased and discounted (Note 8.2) 16,006,102,273 8,593,408,568
197,504,138,756 163,609,782,739

8.1 Loans, cash credits, overdrafts, etc/investments

Conventional and Islamic banking
Inside Bangladesh
Agricultural loan 4,007,207,580 2,966,056,345
Cash credit/Bai Murabaha (Muajjal) 4,490,806,466 4,059,642,677
Credit card 1,600,308,711 1,252,443,050
Credit for poverty alleviation scheme-micro credit 7,750,298 8,211,805
Consumer credit scheme 9,425,511,886 7,076,436,997
Demand loan 29,894,803,188 26,076,843,769
Export Development Fund (EDF) 12,836,199,262 10,139,413,219
House building loans 1,072,529,546 923,358,410
Loans (General)/ Musharaka 9,216,112,626 7,570,141,631
Loan against trust receipts/ Bai Murabaha post import 12,565,006,707 10,544,307,848
Overdrafts/ Quard against scheme 33,457,754,908 28,072,352,928
Packing credit 609,569,459 452,810,159
Payment against documents 767,633,243 332,742,582
Staff Loan 1,323,514,517 1,329,101,220
Small and medium enterprise (SME) 4,945,185,320 3,957,226,919
Transport loan 1,746,519,994 1,486,136,986
Term loan- industrial 15,997,171,467 12,243,061,104
Term loan- others/ Hire purchase under Shirkatul Melk 35,026,223,256 35,140,217,065
178,989,808,434 153,630,504,714
Outside Bangladesh - -
178,989,808,434 153,630,504,714
Off-shore banking unit 2,508,228,049 1,385,869,457
181,498,036,483 155,016,374,171

Annual Integrated Report 2017

291
 Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016

8.2 Bills purchased and discounted

Conventional and Islamic banking 3,358,989,074 2,231,598,821
Off-shore banking unit 12,647,113,199 6,361,809,747
16,006,102,273 8,593,408,568

8.3 Maturity-wise grouping

Repayable on demand 28,256,123,459 24,589,400,000
Not more than 3 months 34,402,360,425 27,536,100,000
More than 3 months but not more than 1 year 48,521,499,210 55,644,800,000
More than 1 year but not more than 5 years 57,693,757,224 38,834,500,000
More than 5 years 28,630,398,438 17,004,982,739
197,504,138,756 163,609,782,739

8.4 Net loans and advances/investments

Gross loans and advances/investments 197,504,138,756 163,609,782,739
Less: Interest suspense (Note 13.4) 1,709,429,069 1,584,318,032
Provision for loans and advances/investments (Note 13.2) 7,841,186,140 7,423,718,412
9,550,615,209 9,008,036,444
187,953,523,547 154,601,746,295
8.5 Loans and advances/investments under the following broad categories
In Bangladesh
Loans 143,549,475,109 122,884,378,566
Cash credits 4,490,806,466 4,059,642,677
Overdrafts 33,457,754,908 28,072,352,928
Bills purchased and discounted 14,033,700,796 7,231,191,495
195,531,737,279 162,247,565,666
Outside Bangladesh
Bills purchased and discounted 1,972,401,477 1,362,217,073
197,504,138,756 163,609,782,739

8.6 Significant concentration wise grouping

a) Directors - -
b) Chief Executive and other senior executives
i) Managing Director 3,745,000 4,371,000
ii) Other senior executives 137,966,000 166,816,000
141,711,000 171,187,000
c) Agriculture 4,074,800,000 2,340,000,000
d) Industry
Food Manufacturing 10,907,400,000 11,510,000,000
Beverage industry 747,200,000 510,000,000
Tobacco industry 311,900,000 260,000,000
RMG industry 22,666,400,000 18,150,000,000
Textile industry 20,274,900,000 13,620,000,000
Wood cork and allied products 41,500,000 50,000,000
Furniture and Fixture 156,000,000 110,000,000
Paper and paper products 8,648,300,000 7,740,000,000
Leather and leather products 2,073,000,000 2,580,000,000
Rubber products 2,355,300,000 1,710,000,000
Chemical and chemical products 1,632,800,000 1,470,000,000
Basic metal products 6,225,200,000 8,250,000,000
Electrical machinery and apparatus 3,794,800,000 2,550,000,000
Other manufacturing industries 13,467,827,756 8,518,595,739
Ship building 2,080,300,000 2,550,000,000

Bank Asia Limited

292
Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016

Ship breaking 760,100,000 1,230,000,000

Pharmaceutical 467,300,000 510,000,000
96,610,227,756 81,318,595,739
e) Constructions 5,280,500,000 5,760,000,000
f) Power, Gas, Water and Sanitary Services 2,023,400,000 50,000,000
g) Transport, Storage and Communication 2,823,900,000 2,810,000,000
h) Trade Services 34,740,500,000 32,040,000,000
i) Housing Services 13,882,700,000 12,050,000,000
j) Banking and Insurance 7,178,500,000 7,270,000,000
k) Professional and Misc. services 30,747,900,000 19,800,000,000
197,504,138,756 163,609,782,739

8.7 Geographical location-wise grouping

Inside Bangladesh
Urban
Dhaka Division 149,084,626,608 116,260,976,585
Chittagong Division 23,855,887,548 25,597,304,865
Khulna Division 3,347,579,548 3,069,004,993
Rajshahi Division 1,772,100,569 2,583,635,892
Barisal Division 564,260,759 307,935,524
Sylhet Division 1,896,508,024 1,512,242,118
Rangpur Division 805,131,771 666,726,159
Mymensingh Division 314,200,852 191,202,332
181,640,295,679 150,189,028,468
Rural
Dhaka Division 9,555,052,582 8,208,892,360
Chittagong Division 4,151,016,922 2,873,176,229
Sylhet Division 368,262,505 389,708,643
Rajshahi Division 1,789,511,068 1,948,977,039
15,863,843,077 13,420,754,271
Outside Bangladesh - -
197,504,138,756 163,609,782,739

8.8 Loans/investments including bills purchased and

discounted covered by securities
Collateral of movable/immovable assets 119,484,812,694 112,245,733,702
Local banks and financial institutions' guarantee 806,037,474 569,596,563
Foreign banks' guarantee 1,397,781,364 77,435,321
Export documents 6,989,106,354 9,733,410,621
Cash and quasi cash 5,855,886,105 4,924,425,933
Personal guarantee 37,723,687,101 19,993,938,141
Other securities 25,246,827,664 16,065,242,459
197,504,138,756 163,609,782,739

8.9 Details of large loans/investments

As at 31 December 2017 there were Thirteen (2016: Seventeen) clients with whom amount of outstanding and classified loans and
advances exceeded 10% of the total capital of the Bank. Total capital of the Bank was Taka 32,913.95 million as at 31
December 2017 (Taka 24,774.61 million in 2016). Details are shown in Annex E.

Annual Integrated Report 2017

293
 Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016
8.10 Particulars of loans and advances/investments
i) Loans/investments considered good in respect of which the Bank
134,533,623,991 127,550,602,140
is fully secured
ii) Loans/investments considered good against which the Bank holds
37,723,687,101 19,993,938,141
no security other than the debtors’ personal guarantee
iii) Loans/investments considered good secured by the personal undertaking
25,246,827,664 16,065,242,459
of one or more parties in addition to the personal guarantee of the debtors
iv) Loans/investments adversely classified; provision not
- -
maintained there against
197,504,138,756 163,609,782,739
v) Loans/investments due by directors or officers of the Bank or
1,323,514,517 1,329,101,220
any of them either separately or jointly with any other persons
vi) Loans/investments due from companies or firms in which the directors or officers
of the bank have interest as directors, partners or managing agents or in case of - -
private companies, as members
vii) Maximum total amount of advances/investments, including temporary advances/
investments made at any time during the year to directors or managers or officers 1,323,514,517 1,329,101,220
of the bank or any of them either separately or jointly with any other person.
viii) Maximum total amount of advances/investments, including temporary advances/
investments granted during the year to the companies or firms in which the direc-
- -
tors of the bank are interested as directors, partners or managing agents
or in the case of private companies, as members
ix) Due from banking companies 16,006,102,273 8,593,408,568
x) Amount of classified loans/investments on which interest has not
been charged mentioned as follows:
a) Increase/(Decrease) of provision (specific) (754,286,290) 1,583,696,031
Amount of loan written off 2,138,547,250 920,450,690
Amount realised against the loans previously written off 34,250,512 42,108,117
b) Provision kept against loans/investments classified as bad debts 3,739,999,617 4,494,285,907
c) Interest credited to interest suspense account 1,709,429,069 1,584,318,032
xi) Cumulative amount of written off loans/investments
Opening balance 5,122,919,333 4,202,468,643
Amount written off during the year 2,138,547,250 920,450,690
The amount of written off loans/investments for which law suit has been filed 7,261,466,584 5,122,919,333

8.11 Grouping as per classification rules

Unclassified:
Standard including staff loan 179,810,129,754 146,653,042,739
Special mentioned account 9,051,706,000 8,109,401,000
188,861,835,754 154,762,443,739

Classified:
Sub-standard 486,181,000 408,273,000
Doubtful 705,227,000 297,728,000
Bad/loss 7,450,895,000 8,141,338,000
8,642,303,000 8,847,339,000
197,504,138,754 163,609,782,739

Bank Asia Limited

294
Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016
8.12 Particulars of required provision for loans and advances/investments

Outstanding Base for Required provison

Status
at 31 Dec 2017 provision % Amount

For loans and advances/Investments:

Unclassified - general provision
All unclassified loans (other than SME financing, house building loan and loan for professional, loan to Brokerage House (BH),
consumer finance, staff loan and SMA) 123,031,770,989 109,237,505,452 1% to 5% 2,989,078,387 1,949,623,681
Small and medium enterprise financing 27,128,564,000 27,128,564,000 0.25% 67,821,410 41,422,610
House building loan and loan for professional 7,374,203,000 7,374,203,000 1 to 2% 73,742,030 116,905,109
Loans to BH 2,365,270,000 2,365,270,000 2.00% 47,305,400 53,386,825
Consumer finance 3,437,541,000 3,437,541,000 2% to 5% 129,901,000 134,478,810
Staff loan 1,317,439,517 - - - -
3,307,848,227 2,295,817,035
Special mentioned account 9,051,706,000 9,051,706,000 0.25% to 90% 630,604,361 556,138,678
Off-shore unit
Unclassified loans (general) 15,155,341,248 15,155,341,248 1% 151,553,412 63,936,443
Special mentioned account - - 0.25% to 90% - 13,540,349
151,553,412 77,476,792
Classified - specific provision
Sub-standard 486,181,000 343,863,000 20% / 5% 67,277,000 24,923,695
Doubtful 705,227,000 594,694,000 50% / 5% 296,561,000 103,340,237
Bad/loss 7,450,895,000 3,576,479,453 100% 3,368,851,000 4,366,021,975
3,732,689,000 4,494,285,907
Provision required for loans and advances 7,822,695,000 7,423,718,412
Total provision maintained (Note 13.2)
Conventional and Islamic Banking 7,689,632,728 7,346,241,620
Off-shore Banking Unit 151,553,412 77,476,792
7,841,186,140 7,423,718,412

8.13 Suits filed by the Bank (Branch wise details)

Agrabad Branch 2,413,131,694 1,602,308,021
Anderkilla Branch 1,661,417,788 1,036,343,414
Ashulia Branch 23,540,241 23,540,241
Bahadderhat Branch 61,924,493 61,924,493
Bank Asia Bhaban Branch 100,592,656 -
Bashundhara Branch 270,928,042 270,952,454
Beanibazar Branch 5,584,770 -
Bhatiary Branch 648,058,321 390,863,548
Bogra Branch 174,535,660 63,232,333
Credit Cards Department 58,705 58,705
CDA Avenue Branch 5,440,748,716 461,566,884
Chatkhil Branch 17,361,013 17,361,013
Corporate Branch 322,102,269 312,319,067
Dhanmondi Branch 121,553,320 89,427,533
Donia Branch 32,926,436 30,922,878
Gulshan Branch 165,905,973 215,733,425
Holy Family RCMCH Branch 40,813,609 -

Annual Integrated Report 2017

295
 Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016
Jessore Branch 89,881,449 58,698,895
Jurain SME Centre 5,565,685 941,349
Kamal Bazar Branch 315,335 315,335
KEPZ Branch 5,519,100 5,519,100
Khatunganj Branch 2,033,775,121 2,014,225,997
Khulna Branch 77,394,034 77,394,034
Lohagara Branch 15,123,119 18,602,599
Malkhanagar Branch 103,830,164 109,650,435
MCB Banani Branch 54,234,479 54,234,479
MCB Dilkusha Branch 1,282,815,521 109,418,307
MCB Sk. Mujib Road Branch 2,056,385,324 2,721,508,241
Mirpur Branch 23,409,708 18,623,772
Mitford Branch 300,047,766 129,740,029
Moghbazar Branch 53,513,290 53,513,290
Mohakhali Branch 36,824,325 879,256
Narayangonj Branch 79,008,104 2,834,027
North South Road Branch 1,302,969,283 47,098,679
Oxygen Moor Branch 5,874,497 -
Paltan Branch 10,831,306 6,708,387
Principal Office Branch 799,141,632 463,612,434
Progoti Sarani Branch 35,201,218 5,988,412
Rajshahi Branch 4,856,245 2,771,665
Ramgonj SME/Agri Branch 13,655,636 13,655,636
Rekabi bazar SME Center 348,681 348,681
Rupnagar Branch 870,417 -
Savar Branch 18,843,802 18,843,802
Scotia Branch 620,245,034 433,596,615
Shantingar Branch 923,082,989 424,592,794
Station Road Branch 156,316,446 155,203,399
Strand Road Branch 4,941,664 -
Sylhet Main Branch 31,102,359 23,487,548
Sylhet Uposhahar Branch 183,201,041 172,482,880
Sylhet Uposhahar Islamic Window Branch 17,140,393 17,140,393
Tongi Branch 2,174,613 3,181,896
Uttara Branch 157,458,561 157,458,561
22,007,082,045 11,898,824,936
8.14 Bills purchased and discounted
Payable in Bangladesh 14,033,700,796 7,231,191,495
Payable outside Bangladesh 1,972,401,477 1,362,217,073
16,006,102,273 8,593,408,568

8.15 Maturity-wise grouping of bills purchased and discounted

Payable within 1 month 3,290,362,273 2,892,870,540
More than 1 month but less than 3 months 4,151,658,549 2,543,933,436
More than 3 months but less than 6 months 4,971,661,780 2,747,039,373
More than 6 months 3,592,419,671 409,565,219
16,006,102,273 8,593,408,568

Bank Asia Limited

296
Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016
8(a) Consolidated Loans and advances/investments
Bank Asia Limited 181,498,036,483 155,016,374,171
Bank Asia Securities Limited 5,074,106,215 5,380,138,055
BA Exchange Company (UK) Limited - -
BA Express USA, Inc - -
186,572,142,698 160,396,512,226
Less: Inter- companies transactions 2,249,821,140 2,450,004,404
184,322,321,558 157,946,507,822
Bills purchased and discounted
Bank Asia Limited 16,006,102,273 8,593,408,568
Bank Asia Securities Limited - -
BA Exchange Company (UK) Limited - -
BA Express USA, Inc - -
16,006,102,273 8,593,408,568
200,328,423,831 166,539,916,390

9 Fixed assets including premises, furniture and fixtures

Conventional and Islamic banking (Note 9.1) 5,329,740,498 5,249,722,487
Off-shore banking unit - -
5,329,740,498 5,249,722,487

9.1 Conventional and Islamic banking

Cost:
Land 2,646,764,306 2,646,764,306
Building 2,752,485,491 2,619,652,725
Furniture and fixtures 1,264,478,318 1,150,574,690
Equipments 891,352,643 782,810,977
Computer and accessories 477,162,667 421,798,649
Construction work in progress 202,550,799 151,787,396
Motor vehicles 213,632,600 214,506,754
8,448,426,824 7,987,895,498
Less: Accumulated depreciation 3,064,971,063 2,655,972,523
Adjustment of assets revaluation 53,715,264 82,200,488
Written down value at the end of the year - Details are shown in Annex C. 5,329,740,498 5,249,722,487
9(a) Consolidated Fixed assets including premises, furniture and fixtures
Bank Asia Limited 5,329,740,498 5,249,722,487
Bank Asia Securities Limited 4,025,035 1,155,819
BA Exchange Company (UK) Limited 4,496,726 5,058,756
BA Express USA, Inc 5,968,648 7,211,405
5,344,230,907 5,263,148,467
10 Other assets
Conventional and Islamic banking (Note 10.1) 11,042,584,828 10,659,652,878
Off-shore banking unit 41,073,945 187,338,736
11,083,658,773 10,846,991,614
10.1 Conventional and Islamic banking
Income generating other assets
Investment in Bank Asia Securities Ltd - incorporated in Bangladesh 1,999,990,000 1,999,990,000
Investment in BA Exchange Company (UK) Limited - incorporated in UK 33,168,000 29,400,000

Annual Integrated Report 2017

297
 Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016
Investment in BA Express USA Inc - incorporated in USA 79,392,000 75,552,000
2,112,550,000 2,104,942,000
Non-income generating other assets
Income receivable (Note 10.2) 775,868,203 646,062,044
Stock of stamps 6,856,038 6,229,735
Stationery, printing materials, etc 41,945,600 28,082,022
Prepaid expenses 25,011,208 9,487,252
Deposits and advance rent 332,424,273 278,444,649
Advances, prepayments and others (Note 10.3) 260,421,177 180,570,610
Advance income tax (Note 10.4) 6,781,572,306 6,868,217,724
Receivable against government 213,945,758 126,163,566
Sundry debtors 51,288,052 127,064,677
Branch adjustment account (Note 10.5) 123,377,471 35,223,277
Protested bills 65,242,265 66,997,265
Receivable from BA Exchange Company (UK) Limited 73,960,113 45,388,625
Receivable from BA Express USA Inc 165,167,024 127,240,282
Excise duty recoverable 12,955,340 9,539,150
8,930,034,828 8,554,710,878
11,042,584,828 10,659,652,878
10.2 income receivable
Income receivable consists of interest accrued on investment and other income.
10.3 Advances, prepayments and others
Advances, prepayments and others account consists of advance amount paid for purchasing of fixed assets, advance payment of rent
for new branches of the Bank, advance against salary and legal expenses, etc.
10.4 Advance income tax
Advance income tax was adjusted against provision for taxation for the year 2014 as the tax assessments have been finalized for the
said income year.
10.5 Branch adjustment accounts
This represents outstanding inter-branch and head office transactions (net) which are originated but not responded by the counter
transaction at the balance sheet date. The unresponded entries of 31 December 2017 are given below:

Number of Amount of Number of re- Amount of re-

Periods of Reconciliation responded responded sponded entries sponded entries
entries (Debit) entries (Taka) (Credit) (Taka)
Up to 3 months 27 24,786,294 70 2,300,736
More than 3 months but within 6 months 3 638 1 474,988
More than 6 months but within 1 year - - - -
More than 1 year but within 5 years 1 40,000 - -
Above 5 years - - - -
31 24,826,932 71 2,775,724

10.6 Receivable from Government in connection with Rangs Properties:

The Bank has a receivable from Government in connection with demolition of Rangs Bhaban in 2008 situated at 113-116 Old Airport
Road, Dhaka-1215. Bank Asia had a purchased floor at 3rd floor of the Building, where from the then Scotia Branch used to run. Total
receivable in this regard is Tk. 3,19,52,365.00 (Taka three crore nineteen lac fifty two thousand three hundred sixty five) which was
eventually written-off from the Book considering uncertainty and prolonged legal proceedings.

10 (a) Consolidated Other assets

Bank Asia Limited 11,083,658,773 10,846,991,614
Bank Asia Securities Limited 286,992,354 247,487,042

Bank Asia Limited

298
Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016

BA Exchange Company (UK) Limited 5,749,700 3,927,250

BA Express USA, Inc 91,434,840 60,526,377
11,467,835,667 11,158,932,283
Less: Inter- companies transactions
Investment in Bank Asia Securities Limited 1,999,990,000 1,999,990,000
Investment in BA Exchange Company (UK) Limited 32,820,000 28,386,000
Investment in BA Express USA, Inc 78,720,000 75,504,000
Receivable from BASL - -
Receivable from BA Exchange Company (UK) Limited 73,960,113 45,388,625
Receivable from BA Exchange USA, Inc. 165,167,024 127,240,282
9,117,178,530 8,882,423,376

10(aa) Demutualization membership of Dhaka Stock Exchange

The majority owned (99.99%) subsidiary company of the Bank, Bank Asia Securities Limited (BASL) has acquired the
membership of Dhaka Stock Exchange for Tk. 153,119,000. As per the scheme of Demutualization of DSE, BASL being the
initial shareholders of DSE, is entitled to receive 7,215,106 shares of Tk. 10 each, totalling Tk. 72,151,060.

The Scheme is not yet completed and these shares are also currently not traded. Hence the actual fair value is not readily
ascertainbale. However, management expect the fair value to be similar or more that the current revalued amount. Once more clarity
about the Scheme and related factors are available a determination of fair value and related adjustments including
impairment assessment, if any shall be made at that time.

11 Borrowings from other banks, financial institutions and agents

Conventional and Islamic banking (Note 11.1) 15,349,703,961 9,347,599,580
Off-shore banking unit (Note 11.2) 15,423,078,092 9,474,823,844
Less: Adjustment with Head Office (504,470,000) -
30,268,312,053 18,822,423,424

11.1 Conventional and Islamic banking

In Bangladesh (Note 11.1.1) 15,349,703,961 9,347,599,580
Outside Bangladesh - -
15,349,703,961 9,347,599,580

11.1.1 In Bangladesh
Secured: - -
Un secured:
Money at call and on short notice
Sonali Bank 1,500,000,000 -
Janata Bank 1,000,000,000 -
2,500,000,000 -
Borrowings
Bangladesh Bank refinance 81,913,942 103,695,498
SME Foundation Pre Finance 74,630,000 37,100,000
Borrowing A/C (AGRI Taka 10) 28,272,774 4,357,097
Bio-Gas Plant refinance 733,332 824,999
Borrowing- Green finance refinance 140,000,000 170,000,000
Export development fund 12,524,153,913 9,031,629,147
Onshore export discount fund 514,046,529 298,988,147
13,363,750,490 9,646,594,888
Less : Inter borrowings between OBU and Conventional Banking (514,046,529) (298,995,308)
15,349,703,961 9,347,599,580
Annual Integrated Report 2017
299
 Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016
11.2 Borrowing at Off-shore banking unit
Secured: - -
Un secured:
Conventional Banking 604,208,628 -
International Finance Corporation 3,280,000,000 2,359,500,000
Borrowing - ECA 455,359,062 -
Standard Chartered Bank, Singapore 2,665,000,000 1,266,092,049
Bank Of Tokyo-Mitsubishi 1,640,000,000 -
National Bank of Ras Al Khaimah 1,533,400,000 1,415,700,000
United Bank Limited, UAE 1,451,400,000 831,959,700
Habib Bank Limited, Bangladesh - -
First Gulf Bank 820,000,000 1,063,662,600
ICICI Bank Limited, Hong Kong 820,000,000 -
Bank Muscat SAOG 574,000,000 -
Nepal Bangladesh Bank Limited 410,000,000 393,250,000
Commercial Bank of Ceylon 410,000,000 -
HDFC, Gift City, Mumbai 410,000,000 -
Noor Islami Bank, Dubai, UAE 246,000,000 -
KBC Bank, Brussels 103,710,402 -
ICICI Bank Limited, Dubai - 471,900,000
CaixaBank - 1,573,000,000
Commerzbank - 99,759,495
15,423,078,092 9,474,823,844

11(a) Consolidated Borrowings from other banks, financial institutions and agents
Bank Asia Limited 30,268,312,053 18,822,423,424
Bank Asia Securities Limited 2,447,067,334 2,606,557,920
BA Exchange Company (UK) Limited - -
BA Express USA, Inc - -
32,715,379,387 21,428,981,344
Less: Inter-company transactions 2,249,821,140 2,450,004,404
30,465,558,247 18,978,976,940

11(aa) Subordinated Non-Convertible Bonds

Subordinated Non-Convertible Zero Coupon Bond
A.K Khan & Company Limited 38,578,342 82,171,739
AB Bank 1st Mutual Fund 5,859,904 12,481,576
EBL First Mutual Fund 1,541,827 3,284,087
EBL NRB Mutual Fund 3,074,048 6,547,712
EXIM Bank 1st Mutual Fund 6,172,112 13,146,578
First Bangladesh Fixed Income Fund 32,397,584 69,006,746
IFIC Bank 1st Mutual Fund 1,537,024 3,273,856
Industrial and Infrastructure Development Finance Company Limited (IIDFC) 1,891,020 4,027,866
Popular Life 1st Mutual Fund 1,537,024 3,273,856
92,588,885 197,214,016

Subordinated Non-Convertible floating rate bond

Agrani Bank Limited 200,000,000 200,000,000
BRAC Bank Limited 100,000,000 100,000,000
Janata Bank Limited 250,000,000 250,000,000

Bank Asia Limited

300
Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016
Mercantile Bank Limited 500,000,000 500,000,000
One Bank Limited 600,000,000 600,000,000
Pubali Bank Limited 250,000,000 250,000,000
Rupali Bank Limited 600,000,000 600,000,000
Sonali Bank Limited 500,000,000 500,000,000
3,000,000,000 3,000,000,000
Subordinated Non-Convertible floating rate bond
Agrani Bank Limited 250,000,000 -
Dhaka Bank Limited 750,000,000 -
Janata Bank Limited 250,000,000 -
National Life Insurance Co 500,000,000 -
Pubali Bank Limited 1,000,000,000 -
Sabinco 150,000,000 -
Sadharan Bima Corporation 100,000,000 -
Sonali Bank Limited 1,000,000,000 -
Southeast Bank Limited 500,000,000 -
Uttara Bank Limited 500,000,000 -
5,000,000,000 -
8,092,588,885 3,197,214,016

11.3 Maturity-wise grouping (Note 11 and Note 11 aa)

Payable on demand 4,932,033,963 2,880,900,000
Up to 1 month - -
More than 1 month but within 3 months 14,454,700,000 4,226,400,000
More than 3 months but within 1 year 7,238,807,914 9,365,000,000
More than 1 year but within 5 years 3,735,359,061 2,547,337,440
More than 5 years 8,000,000,000 3,000,000,000
38,360,900,938 22,019,637,440

11.4 Disclosure regarding REPO

Disclosure regarding REPO transactions of the bank are given as per Bangladesh Bank, DOS Circular No. 6 dated July 15, 2010
a (i) Disclosure regarding outstanding REPO as on 31 December
Sl. # Counter party name Agreement date Reversal Date Amount (Taka)
NIL
Total -
(ii) Disclosure regarding outstanding Reverse REPO as on 31 December
Sl. # Counter party name Agreement date Reversal Date Amount (Taka)
NIL
Total -
b Disclosure regarding overall transaction of REPO & Reverse REPO
Minimum outstand- Maximum outstand- Daily average outstanding
Particulars ing during the year ing during the year during the year
Securities sold under repo:
i) with Bangladesh Bank - - -
ii) with other banks & FIs - - -
Securities purchased under reverse repo:
i) with Bangladesh Bank - - -
ii) with other banks & FIs - - -

Annual Integrated Report 2017

301
 Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016

12 Deposits and other accounts

Conventional and Islamic banking (Note 12.1) 206,721,241,149 191,006,259,141
Off-shore banking unit 320,230,232 266,323,636
207,041,471,381 191,272,582,777
Deposits and other accounts
Current/Al-wadeeah current accounts and other accounts
Deposits from banks - -
Deposits from customers 41,701,521,101 34,001,328,317
Off-shore banking unit 298,108,075 252,430,353
41,999,629,176 34,253,758,670
Bills payable
Deposits from banks - -
Deposits from customers 3,968,967,652 4,902,979,613
3,968,967,652 4,902,979,613
Savings bank/Mudaraba savings bank deposits
Deposits from banks - -
Deposits from customers 34,496,938,426 27,793,803,978
34,496,938,426 27,793,803,978
Fixed deposits/Mudaraba fixed deposits
Deposits from banks 1,803,098,995 1,022,426,422
Deposits from customers 124,750,714,975 123,285,720,811
Off-shore banking unit 22,122,157 13,893,283
126,575,936,127 124,322,040,516
207,041,471,381 191,272,582,777
12.1 Conventional and Islamic banking
Deposits from banks (Note 12.1.1) 1,803,098,995 1,022,426,422
Deposits from customers (Note 12.1.2) 204,918,142,154 189,983,832,719
206,721,241,149 191,006,259,141
12.1.1 Deposits from banks
Fixed deposit/SND
AB Bank Limited 39,982 40,068
EXIM Bank Limited 1,947,918 312,263
Islami Bank Bangladesh Limited - 1,000,000,000
Sonali Bank Limited - 20,982,824
Social Islami Bank Limited 554,491 544,597
Trust Bank Limited 556,604 546,670
Agrani Bank Limited 1,800,000,000 -
Bank Asia Limited 1,400,000,000 -
3,203,098,995 1,022,426,422
Less: Inter-company transactions with Bank Asia Islamic Window (1,400,000,000) -
1,803,098,995 1,022,426,422
12.1.2 Deposits from customers
Current/Al-wadeeah current accounts and other accounts ( Note 12.1.2a) 41,701,521,101 34,001,328,317
Bills payable (Note 12.1.2b) 3,968,967,652 4,902,979,613
Savings bank/Mudaraba savings deposits 34,496,938,426 27,793,803,978
Fixed deposits/Mudaraba fixed deposits (Note 12.1.2c) 124,750,714,975 123,285,720,811
204,918,142,154 189,983,832,719

Bank Asia Limited

302
Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016
12.1.2a Current/Al-wadeeah current accounts and other accounts
Current/Al-wadeeah current accounts 14,883,359,452 12,670,982,805
Other demand deposit - Local currency 19,606,123,861 16,011,616,064
Other demand deposit - Foreign currencies 5,742,409,920 4,065,098,790
Foreign currency deposits 1,469,627,868 1,253,630,658
41,701,521,101 34,001,328,317
12.1.2b Bills payable
Bills payable - local currency 3,961,854,176 4,896,424,017
Bills payable - foreign currencies 7,113,476 6,555,596
3,968,967,652 4,902,979,613
12.1.2c Fixed deposits/Mudaraba fixed deposits
Fixed deposits/Mudaraba fixed deposits 66,948,110,139 67,718,049,550
Special notice deposit 24,118,638,106 23,189,124,189
Foreign currency deposits (interest bearing) 3,284,209 3,099,967
Deposit under schemes 33,680,682,521 32,375,447,105
124,750,714,975 123,285,720,811
12.2 Payable on demand and time deposits
a) Demand deposits
Current/Al-wadeeah current accounts and other accounts 15,181,467,527 12,923,413,158
Savings bank/Mudaraba savings deposits 3,104,724,458 2,501,442,358
Foreign currency deposits (non interest bearing) 7,212,037,788 5,318,729,448
Sundry deposits 19,606,123,861 16,011,616,064
Bills payable 3,968,967,652 4,902,979,613
49,073,321,286 41,658,180,641
b) Time deposits
Savings bank/Mudaraba savings deposits 31,392,213,968 25,292,361,620
Fixed deposits/Mudaraba fixed deposits 68,773,331,291 68,754,369,255
Foreign currency deposits (interest bearing) 3,284,209 3,099,967
Special notice deposit 24,118,638,106 23,189,124,189
Deposits under schemes 33,680,682,521 32,375,447,105
157,968,150,095 149,614,402,136
207,041,471,381 191,272,582,777
12.3 Sector-wise break-up of deposits and other accounts
Government 2,793,276,000 2,902,274,000
Deposit from banks 1,803,098,995 1,022,426,422
Other public 6,956,983,000 2,043,868,000
Foreign currencies 7,542,665,705 5,594,708,647
Private 187,945,447,681 179,709,305,708
207,041,471,381 191,272,582,777
12.4 Maturity-wise grouping
12.4.1 Deposits from banks
Payable on demand 1,803,098,995 1,022,426,422
Up to 1 month - -
Over 1 month but within 6 months - -
Over 6 months but within 1 year - -
Over 1 year but within 5 years - -
Over 5 years - -
1,803,098,995 1,022,426,422

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 Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016
12.4.2 Customer deposits excluding bills payable
Payable on demand 4,429,700,000 3,463,100,000
Up to 1 month 25,593,601,005 18,205,673,578
Over 1 month but within 6 months 28,359,714,179 18,823,220,387
Over 6 months but within 1 year 59,518,732,453 76,511,600,000
Over 1 year but within 5 years 54,191,271,406 34,098,182,777
Over 5 years 29,176,385,691 34,245,400,000
201,269,404,734 185,347,176,742
12.4.3 Bills payable
Payable on demand 432,400,000 536,900,000
Up to 1 month 3,800,000 2,200,000
Over 1 month but within 6 months 3,532,767,652 4,363,879,613
Over 6 months but within 1 year - -
Over 1 year but within 5 years - -
Over 5 years - -
3,968,967,652 4,902,979,613
207,041,471,381 191,272,582,777

12(a) Consolidated Deposits and other accounts

Current/Al-wadeeah current accounts and other accounts
Bank Asia Limited 41,999,629,176 34,253,758,670
Bank Asia Securities Limited 257,521,410 336,518,761
BA Exchange Company (UK) Limited - -
BA Express USA, Inc - -
42,257,150,586 34,590,277,431
Less: Inter-company transactions 15,047,104 36,057,950
42,242,103,482 34,554,219,481
Bills payable
Bank Asia Limited 3,968,967,652 4,902,979,613
Bank Asia Securities Limited - -
BA Exchange Company (UK) Limited - -
BA Express USA, Inc - -
3,968,967,652 4,902,979,613
Savings bank/Mudaraba savings bank deposits
Bank Asia Limited 34,496,938,426 27,793,803,978
Bank Asia Securities Limited - -
BA Exchange Company (UK) Limited - -
BA Express USA, Inc - -
34,496,938,426 27,793,803,978
Fixed deposits/Mudaraba fixed deposits
Bank Asia Limited 126,575,936,127 124,322,040,516
Bank Asia Securities Limited - -
BA Exchange Company (UK) Limited - -
BA Express USA, Inc - -
126,575,936,127 124,322,040,516
207,283,945,687 191,573,043,588
13 Other liabilities
Conventional and Islamic banking (Note 13.1) 22,538,907,248 20,862,468,284
Off-shore banking unit 869,621.20 2,535,010
22,539,776,869 20,865,003,294

Bank Asia Limited

304
Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016
13.1 Conventional and Islamic banking
Provision for loans and advances/investments (Note 13.2) 7,841,186,140 7,423,718,412
Provision on off-balance sheet exposures (Note 13.3) 1,330,999,470 1,107,620,470
Interest suspense account (Note 13.4) 1,709,429,069 1,584,318,032
Provision for income tax including deferred tax (Note 13.5) 9,277,475,391 9,017,765,672
Provision for performance and festival bonus 237,649,609 186,976,135
Master card and Visa card payables 5,116,895 2,408,414
Expenditures and other payables 101,027,063 88,460,387
Provision for nostro accounts (Note 13.6) - -
Other payable 96,745,219 71,832,181
Provision for profit equalisation 28,758,686 18,758,686
Provison for Smart Junior Saver A/c - 135,618
Provision for diminution in value of shares (Note 13.7) 253,383,553 253,383,553
Payable to Government 314,657,621 168,647,621
Provision for others (Note 13.8) 134,718,755 134,822,336
Rebate payable on good borrowers 67,700,000 71,400,000
Unearned income 650,090,274 457,801,235
Clearing adjustment account 138,529,476 113,680,477
Interest payable on subordinated non-covertable zero coupon bond 260,374,046 160,739,055
ATM/POS settlement account 91,065,981 -
22,538,907,248 20,862,468,284

13.2 Provision for loans and advances/investments

A. General provision - Conventional and Islamic
Balance at the beginning of the year 2,851,955,713 2,997,793,755
Add: Provision made during the year
On general loans and advances/investments etc. 1,097,677,398 565,536,497
Transfer from Provision for diminution in value of shares - -
Transfer from Specific Provision - -
1,097,677,398 565,536,497
Less: Provision no longer required
Specific provision - (170,000,000)
Written off - (541,374,539)
- (711,374,539)
Conventional and Islamic Balance at the end of the year 3,949,633,111 2,851,955,713
B. General provision - OBU
Balance at the beginning of the year 77,476,792 87,220,233
Add: Provision made during the year 74,076,620
Less: Provision no longer required - (9,743,441)
OBU Balance at the end of the year 151,553,412 77,476,792
C. Total general provision on loans and advances/investments (A+B) 4,101,186,523 2,929,432,505
D. Specific provision
Balance at the beginning of the year 4,494,285,907 2,911,650,000
Less: Transfer to General Provision - -
Write off/amicable settlement during the year (2,023,431,803) (457,958,215)
(2,023,431,803) (457,958,215)

Annual Integrated Report 2017

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 Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016
Add/ Back: Recoveries of amounts previously written off 34,250,512 42,108,117
Transfer from General Provision - 170,000,000
Specific provision made during the year 1,234,895,000 1,828,486,005
1,269,145,513 2,040,594,122
Total specific provision on loans and advances/investments 3,739,999,617 4,494,285,907
E. Total provision on loans and advances/investments (C+D) 7,841,186,140 7,423,718,412

13.3 Provision on off-balance sheet exposures

Balance at 1 January 1,105,836,980 966,878,338
Add: Provision made during the year 224,575,935 138,958,642
1,330,412,915 1,105,836,980
Less: Adjustments made during the year - -
Balance at the end of the year 1,330,412,915 1,105,836,980

General provision maintained for OBU as at 01 January 1,783,490 1,292,230

Add: Provision made during the year - 491,260
Less: Adjustments made during the year (1,196,935) -
586,555 1,783,490
Balance at the end of the year 1,330,999,470 1,107,620,470

As per BRPD circular letter no. 01 dated 03 Jan 2018, Letter of Credit for fast-track projects from Bangladesh Power Development Board are
exempted from 1% off-balance sheet provision charging.
13.4 Interest suspense account
Balance at 1 January 1,584,318,032 1,329,213,289
Add: Amount transferred to "interest suspense" account during the year 2,010,554,525 2,576,169,983
3,594,872,557 3,905,383,272
Less: Amount of interest suspense recovered 1,796,263,488 2,246,600,131
Interest waiver during the year 89,180,000 74,465,109
1,885,443,488 2,321,065,240
Balance as at 31 December 1,709,429,069 1,584,318,032

13.5 Provision for taxation

Current tax (Note 13.5.1) 8,805,454,026 8,587,244,307
Deferred tax (Note 13.5.2) 472,021,365 430,521,365
9,277,475,391 9,017,765,672

13.5.1 Provision for current tax

Balance at 1 January 8,587,244,307 9,832,107,040
Add: Provision made during the year 1,968,500,000 1,678,000,000
10,555,744,307 11,510,107,040
Less: Adjustments made during the year 1,750,290,281 2,922,862,733
8,805,454,026 8,587,244,307

13.5.2 Provision for deferred tax

Balance at 1 January 430,521,365 367,521,365
Provision made for deferred tax liabilities:
Charged/(credited) to profit and loss statement 41,500,000 63,000,000
472,021,365 430,521,365

Bank Asia Limited

306
Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016
13.5.1(a) Consolidated Provision for current tax
Bank Asia Limited 8,805,454,026 8,587,244,307
Bank Asia Securities Limited 74,671,957 57,042,600
BA Exchange Company (UK) Limited - -
BA Express USA, Inc - -
8,880,125,983 8,644,286,907

13.5.2(a) Consolidated provision for deferred tax

Bank Asia Limited 472,021,365 430,521,365
Bank Asia Securities Limited - -
BA Exchange Company (UK) Limited - -
BA Express USA, Inc - -
472,021,365 430,521,365
13.6 Provision for nostro accounts
As per instructions contained in the circular letter no. FEPD (FEMO)/01/2005-677 dated 13 September 2005 issued by Foreign Ex-
change Policy Department of Bangladesh Bank, Bank is required to make provision regarding the un-reconciled debit balance of
nostro account as at balance sheet date. Adequate provision has been made for debit entries which are outstanding for more than 3
months. Details of unrecognized entries are shown in Annex I.

13.7 Provision for diminution in value of shares

Balance at the beginning of the year 253,383,553 143,383,553
Less: Transfer to general provision for loans and advances/investments - -
Add: Provision made during the year - 110,000,000
Balance at the end of the year 253,383,553 253,383,553

Provision requirement for quoted and unqouted share including subsidiaries 18,725,277 165,199,929
18,725,277 165,199,929
Provision maintained 253,383,553 253,383,553
234,658,276 88,183,624

13.8 Provision for others

Balance at the beginning of the year 134,822,336 134,822,336
Adjustment (103,581) -
Add: Provision made during the year - -
Balance at the end of the year 134,718,755 134,822,336

Provision requirement 121,595,000 103,724,000

Provision maintained 134,718,755 134,822,336
Surplus provison maintained 13,123,755 31,098,336

(Provision for others made for legal expenses, protested bills, expenditure related unreconciled entries and other assets that classi-
fied as bad and loss as per Bangladesh Bank BRPD Circular 14 dated June 25, 2001)

13(a) Consolidated Other liabilities

Bank Asia Limited 22,539,776,869 20,865,003,294
Bank Asia Securities Limited 1,590,527,614 1,418,075,749
BA Exchange Company (UK) Limited 90,837,514 38,521,659
BA Express USA, Inc 188,485,773 104,475,024
Foreign currency effect for subsidiaries - -
24,409,627,770 22,426,075,726

Annual Integrated Report 2017

307
 Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016
Less: Inter- companies transactions
Receivable from BASL - -
Receivable from BA Exchange (UK) Limited 73,960,113 45,388,625
BA Express USA, Inc 165,167,024 127,240,282
24,170,500,633 22,253,446,819
14 Share capital
14.1 Authorized capital
1,500,000,000 ordinary shares of Taka 10 each 15,000,000,000 15,000,000,000
14.2 Issued, subscribed and fully paid up capital
56,372,480 ordinary shares of Taka 10 each issued for cash 563,724,800 563,724,800
364,010,770 (2010: 243,901,270) ordinary shares of Taka 10 each
issued as bonus shares 3,640,107,700 3,640,107,700
Right shares issued 25% for the year 2011 1,050,958,100 1,050,958,100
Issued as bonus shares 20% for the year 2011 1,050,958,120 1,050,958,120
Issued as bonus shares 10% for the year 2012 630,574,870 630,574,870
Issued as bonus shares 10% for the year 2013 693,632,350 693,632,350
Issued as bonus shares 10% for the year 2014 762,995,590 762,995,590
Issued as bonus shares 5% for the year 2015 419,647,570 419,647,570
Issued as bonus shares 12% for the year 2016 1,057,511,890 -
9,870,110,990 8,812,599,100
14.3 Initial public offer (IPO)
Out of the total issued, subscribed and fully paid up capital of the Bank 2,000,000 ordinary shares of Taka 100 each amounting to
Taka 200,000,000 was raised through public offering of shares in 2003.

14.4 Capital to risk-weighted asset

The calculation of CRAR under Basel III has been made as per “Guidelines on Risk Based Capital  Adequacy (Revised  Regulatory Cap-
ital Framework for banks in line with Basel III)” issued by Bangladesh Bank vide its BRPD Circular no. 18 dated December 21, 2014.
Common Equity Tier -1 capital (Going-Concern Capital) In line of Basel III In line of Basel III
Paid up capital 9,870,110,990 8,812,599,100
Statutory reserve (Note 15) 7,345,137,782 6,533,632,030
General reserve 8,166,144 8,166,144
Retained earnings (Note 17) 1,676,694,455 1,444,468,074
18,900,109,371 16,798,865,348
Less: Regulatory adjustments
Reciprocal crossholding in the CET - 1 Capital of Banking, Financial and Insurance Entities 47,446,270 63,308,180
Common Equity Tier -1 capital (Going-Concern Capital) 18,852,663,101 16,735,557,168
Additional Tier 1 Capital - -
Total Tier- 1 Capital 18,852,663,101 16,735,557,168
Tier - 2 Capital (Gone-Concern Capital)
General provision maintained against unclassified loan/investments 4,101,186,523 2,929,432,505
General provision on off-balance sheet exposure 1,330,999,470 1,107,620,470
Subordinated non-covertable zero coupon bonds 8,092,588,885 3,197,214,016
Revaluation reserve of securities and fixed assets 1,341,296,217 1,341,296,217
14,866,071,095 8,575,563,208
Less: Regulatory adjustments
60 % of revaluation reserve for fixed assets, securities and equity securities 804,777,730 536,518,487
Total Tier- 2 Capital 14,061,293,365 8,039,044,721
A) Total capital 32,913,956,465 24,774,601,889
B) Total risk weighted assets (RWA) 221,114,649,466 199,490,690,895
C) Required capital 22,111,464,947 19,949,069,090
D) Capital surplus (A-C) 10,802,491,519 4,825,532,799

Bank Asia Limited

308
Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016
Capital to risk weighted asset ratio
Common Equity Tier- 1 to RWA (minimum 4.5% under Basel III) 8.53% 8.39%
Tier- 1 to RWA ( minimum 5.5% under Basel III) 8.53% 8.39%
Capital to Risk Weighted Assets against minimum requirement 10% 14.89% 12.42%

14.4 (a) Consolidated capital to risk-weighted asset

The calculation of CRAR under Basel III has been made as per “Guidelines on Risk Based Capital  Adequacy (Revised  Regulatory Cap-
ital Framework for banks in line with Basel III)” issued by Bangladesh Bank vide its BRPD Circular no. 18 dated December 21, 2014.
Common Equity Tier -1 capital (Going-Concern Capital) In line of Basel III In line of Basel III
Paid up capital 9,870,110,990 8,812,599,100
Non-controlling (Minority) interest 11,723 11,355
Statutory reserve (Note 15) 7,345,137,782 6,533,632,030
General reserve 8,166,144 8,166,144
Retained earnings (Note 17) 1,554,316,722 1,267,955,303
18,777,743,362 16,622,363,933
Less: Regulatory adjustments
Reciprocal crossholding in the CET - 1 Capital of Banking, Financial and Insurance Entities 47,446,270 63,308,180
Common Equity Tier -1 capital (Going-Concern Capital) 18,730,297,092 16,559,055,753
Additional Tier 1 Capital - -
Total Tier- 1 Capital 18,730,297,092 16,559,055,753

Tier - 2 Capital (Gone-Concern Capital)

General provision maintained against unclassified loan/investments 4,101,186,523 2,929,432,505
General provision on off-balance sheet exposure 1,330,999,470 1,107,620,470
Subordinated non-covertable zero coupon bonds 8,092,588,885 3,197,214,016
Revaluation reserve of securities and fixed assets 1,341,296,217 1,341,296,217
14,866,071,095 8,575,563,208
Less: Regulatory adjustments
60 % of revaluation reserve for fixed assets, securities and equity securities 804,777,730 536,518,487
Total Tier- 2 Capital 14,061,293,365 8,039,044,721
A) Total capital 32,791,590,456 24,598,100,474
B) Total risk weighted assets (RWA) 222,348,618,058 200,371,026,445
C) Required capital 22,234,861,806 20,037,102,645
D) Capital surplus (A-C) 10,556,728,650 4,560,997,829

Capital to risk weighted asset ratio

Common Equity Tier- 1 to RWA ( minimum 4.5% under Basel III) 8.42% 8.26%
Tier- 1 to RWA ( minimum 5.5% under Basel III) 8.42% 8.26%
Capital to Risk Weighted Assets against minimum requirement 10% 14.75% 12.28%

14.5 Percentage of shareholdings at the closing date

At 31 December At 31 December At 31 December At 31 December
Category 2017 2017 2016 2016
No. of shares % No. of shares %
Sponsors & Directors 509,909,013 51.66 399,358,495 45.32
General public 159,542,368 16.17 152,225,966 17.27
Institutions 239,465,916 24.26 287,924,700 32.67
Investment companies 64,773,405 6.56 32,352,949 3.67
Non-resident Bangladeshi 6,937,400 0.70 5,972,282 0.68
Foreign investors 6,382,997 0.65 3,425,518 0.39
987,011,099 100 881,259,910 100

Annual Integrated Report 2017

309
 Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016
14.6 Classification of shareholders by holding
No. of holders % of total holding
Holding
2017 2016 2017 2016
Less than 5000 8,227 8,662 1.07 1.06
5,000 to 50,000 2,037 1,746 2.86 2.57
50,001 to 100,000 135 116 0.99 0.9
100,001 to 200,000 88 59 1.26 0.93
200,001 to 300,000 38 24 0.94 0.66
300,001 to 400,000 10 13 0.35 0.52
400,001 to 500,000 15 11 0.7 0.55
500,001 to 1,000,000 29 39 2.2 3.1
1,000,001 to 10,000,000 76 77 25.59 24.48
Over 10,000,000 26 27 64.04 65.23
10,681 10,774 100 100

14.7 Name of the Directors and their shareholdings as at 31 December 2017

Closing Opening
Sl Name of the director Status
position position
1 Mr. A Rouf Chowdhury Chairman 24,345,100 21,736,697
2 Mr. Mohd Safwan Choudhury Vice Chairman 38,659,258 34,517,195
(Representing Phulbari Tea Estate Ltd)
3 Mrs. Hosneara Sinha Director 45,024,110 40,200,099
4 Mr. M Irfan Syed Director 40,261,275 30,161,853
(Representative director of Amiran Generations Ltd.)
5 Ms. Naheed Akhter Sinha Director 47,274,361 42,209,251
6 Ms. Romana Rouf Chowdhury (Representing Maya Limited) Director 35,283,976 33,146,279
7 Maj. Gen. Mohammad Matiur Rahman, Ndu. Psc (Retd.) Director 19,810,739 13,800,703
(Representing Sinha Fashions Limited)
8 Mr. Mashiur Rahman (Independent Director) Director - -
9 Mr. M Shahjahan Bhuiyan (Independent Director) Director - -
10 Mr. Md. Nazrul Huda (Independent Director) Director - -
15 Statutory reserve
Balance at the beginning of the year 6,533,632,030 5,876,250,921
Add: Addition during the year (20% of pre-tax profit) 811,505,752 657,381,109
Balance at the end of the year 7,345,137,782 6,533,632,030
16 Revaluation reserve
HTM securities (Note 16.1) 8,880,978 3,742,574
HFT securities (Note 16.2) - 36,651,324
Fixed Assets revaluation (Note 16.3) 2,145,503,215 2,199,218,479
2,154,384,193 2,239,612,377
16.1 Revaluation reserve on HTM securities
Balance at 1 January 3,742,574 3,305,385
Gain from revaluation on investments 5,471,656 1,940,195
Adjustment for sale/maturity of securities (333,252) (1,503,006)
8,880,978 3,742,574
16.2 Revaluation reserve on HFT securities
Balance at 1 January 36,651,324 264,905,490
Gain from revaluation on investments 303,206,892 2,242,649,728
Adjustment for sale/maturity of securities (339,858,216) (2,470,903,894)
- 36,651,324

Bank Asia Limited

310
Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016
16.3 Revaluation reserve on Fixed Assets
Balance at 1 January 2,199,218,479 2,281,418,967
Depreciation charged during the year (53,715,264) (82,200,488)
2,145,503,215 2,199,218,479
16 (a) Consolidated Revaluation reserve
Bank Asia Limited 2,154,384,193 2,239,612,377
Bank Asia Securities Limited - -
BA Exchange Company (UK) Limited - -
BA Express USA, Inc - -
2,154,384,193 2,239,612,377
17 Retained earnings
Balance at 1 January 1,444,468,074 2,152,333,448
Add: Post - tax profit fot the year 2,047,528,759 1,545,905,547
Revaluation reserve transferred to retained earnings 53,715,264 82,200,488
3,545,712,096 3,780,439,483
Less: Issue of bonus shares for the year 2015 - 419,647,570
Issue of cash dividend for the year 2015 - 1,258,942,730
Issue of bonus shares for the year 2016 1,057,511,890 -
Transfer to statutory reserve 811,505,752 657,381,109
1,869,017,642 2,335,971,409
1,676,694,455 1,444,468,074
17(a) Consolidated Retained earnings
Balance at 1 January 1,267,955,303 1,867,693,933
Add: Foreign exchange revaluation reserve for opening retained earnings (10,425,178) 9,966,616
Revaluation reserve transferred to retained earnings 53,715,264 82,200,488
Post- tax profit for the year 2,112,089,343 1,644,066,246
Less: Non controlling interest 368 570
3,423,334,364 3,603,926,713
Less: Issue of bonus shares for the year 2015 - 419,647,570
Issue of cash dividend for the year 2015 - 1,258,942,730
Issue of bonus shares for the year 2016 1,057,511,890 -
Transferred to statutory reserve 811,505,752 657,381,109
1,869,017,642 2,335,971,409
1,554,316,722 1,267,955,303
17(b) Non-controlling (Minority) interest
Bank Asia Securities Limited 11,723 11,355
Bank Asia Securities Limited - -
BA Exchange Company (UK) Limited - -
BA Express USA, Inc - -
11,723 11,355
18 Contingent liabilities
Conventional and Islamic banking 136,099,588,616 110,583,698,048
Off-shore banking unit 56,855,460 178,348,954
136,156,444,076 110,762,047,002
Acceptances and endorsements (Note 18.1)
Conventional and Islamic banking 42,833,057,095 35,032,505,701
Off-shore banking unit 31,293,906 65,601,965
42,864,351,001 35,098,107,666
Letters of guarantee
Conventional and Islamic banking (Note 18.2) 40,615,034,541 35,578,341,924
Off-shore banking unit - -
40,615,034,541 35,578,341,924
Annual Integrated Report 2017
311
 Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016
Irrevocable letters of credit
Conventional and Islamic banking (Note 18.3) 37,871,899,346 28,939,384,004
Off-shore banking unit 19,337,568 74,257,398
37,891,236,914 29,013,641,402
Bills for collection
Conventional and Islamic banking (Note 18.4) 14,462,463,349 11,033,466,419
Off-shore banking unit 6,223,986 38,489,591
14,468,687,335 11,071,956,010
Other commitments
Conventional and Islamic banking (Note 18.5) 317,134,285 -
Off-shore banking unit - -
317,134,285 -
136,156,444,076 110,762,047,002

18.1 Acceptances and endorsements

Conventional and Islamic banking 42,833,057,095 35,032,505,701
Off-shore banking unit 31,293,906 65,601,965
42,864,351,001 35,098,107,666

18.2 Letters of guarantee

Letters of guarantee (Local) 23,826,990,859 23,003,634,987
Letters of guarantee (Foreign) 16,788,043,682 12,574,706,937
40,615,034,541 35,578,341,924

Balance for which the Bank is contingently liable in respect of guarantees issued favouring:

Directors or officers 434,133 434,133

Government 28,262,076,560 23,938,645,612
Banks and other financial institutions 2,384,902,218 1,935,789,331
Others 9,967,621,630 9,703,472,848
40,615,034,541 35,578,341,924
18.3 Irrevocable letters of credit
Letters of credit Back to Back (Inland) 3,369,890,633 2,854,011,188
Letters of credit (General) 30,801,387,262 23,688,551,522
Back to back L/C 3,700,621,451 2,396,821,294
37,871,899,346 28,939,384,004

18.4 Bills for collection

Local bills for collection 8,467,036,961 5,360,733,917
Foreign bills for collection 5,995,426,388 5,672,732,502
14,462,463,349 11,033,466,419

18.5 Other commitments

Forward Assets Purchased and Forward Deposits Placed 317,134,285 -

18.6 Workers’ profit participation fund (WPPF)

As per Bangladesh Labour Act 2006 and SRO no. 336/Law/2010, all companies falling within the scope of WPPF are required to
provide 5% of its profit before charging such expense to their eligible employees within the stipulated time. Bank obtained opinion
from its legal advisor regarding this issue which stated that the Bank is not required to make provision for WPPF as it is not within the
scope of WPPF. As such the Bank did not make any provision during the year for WPPF.

Bank Asia Limited

312
Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016
19 Income statement
Income:
Interest, discount and similar income (Note 19.1) 18,868,865,547 18,024,296,520
Dividend income (Note 22) 53,427,973 41,515,740
Fees, commission and brokerage (Note 19.2) 1,459,687,245 1,295,040,854
Gains/ less Losses arising from dealing securities - -
Gains/ less Losses arising from investment securities 24,672,598 51,878,470
Gains/ less Losses arising from dealing in foreign currencies (Note 23.1) 1,660,129,043 1,179,820,426
Income from non-banking assets - -
Other operating income (Note 24) 742,166,065 648,277,718
Profit/ less Losses on interest rate changes - -
22,808,948,471 21,240,829,728
Expenses:
Interest paid/profit shared on deposits and borrowings, etc (Note 21) 10,841,556,834 10,600,935,255
Administrative expenses (Note 19.3) 3,429,054,851 3,148,315,055
Other expenses (Note 34) 1,457,470,719 1,172,113,402
Depreciation on banks assets (Note 33.1) 393,309,290 398,831,506
16,121,391,694 15,320,195,218
6,687,556,777 5,920,634,510
19.1 Interest, discount and similar income
Interest income/profit on investments (Note 20) 16,411,574,859 14,569,387,489
Interest on treasury bills/reverse repo/bills 2,123,698,883 2,758,131,885
Interest income on corporate bonds 153,115,193 148,517,916
Interest on debentures - -
Income from investment in shares, bonds etc - 8,615,515
Capital gain on Government securities and assets 180,476,612 539,643,715
18,868,865,547 18,024,296,520

Figures of previous year have been rearranged, wherever considered necessary, to conform the current year’s presentation.
19.2 Fees, commission and brokerage
Commission 1,459,687,245 1,295,040,854
Brokerage - -
1,459,687,245 1,295,040,854

19.3 Administrative expenses

Salaries and allowances (Note 25) 2,519,793,179 2,336,571,464
Rent, taxes, insurance, electricity, etc (Note 26) 613,241,644 533,568,147
Legal expenses (Note 27) 24,615,519 16,085,833
Postage, stamp, telecommunication, etc (Note 28) 89,544,014 81,601,730
Stationery, printing, advertisement, etc (Note 29) 97,405,242 90,134,202
Managing Director's salary and fees (Note 30) 13,900,000 15,689,899
Directors' fees (Note 31) 2,992,000 3,192,000
Auditors' fees (Note 32) 952,100 1,252,000
Repair of Bank's assets (Note 33.1) 66,611,153 70,219,780
3,429,054,851 3,148,315,055

20 Interest income/profit on investments

Conventional and Islamic banking (Note 20.1) 15,863,103,471 14,104,925,081
Off-shore banking unit 610,079,291 573,549,958

Annual Integrated Report 2017

313
 Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016
16,473,182,762 14,678,475,039
Less: inter transaction between OBU and Conventional banking 51,807,903 109,087,550
Less: Inter-company transactions with Bank Asia Islamic Window 9,800,000 -
16,411,574,859 14,569,387,489

20.1 Conventional and Islamic banking

Agricultural loan 332,171,847 194,932,342
Cash credit/Bai Murabaha (Muajjal) 380,518,415 327,968,152
Credit card 283,302,567 237,215,362
Credit for poverty alleviation scheme-micro credit 256,011 248,495
Consumer credit scheme 905,994,938 793,326,599
Demand loan 2,513,992,881 2,538,065,578
Export Development Fund (EDF) 203,016,677 145,158,477
House building loan 115,547,211 77,528,143
Loans (General)/Musharaka 951,746,928 491,008,347
Loans against trust receipts/ Bai Murabaha post import 1,143,871,511 1,144,721,228
Overdrafts/ Quard against scheme 2,802,747,291 2,667,027,412
Packing credit 36,002,460 31,866,746
Payment against documents 34,070,588 32,184,639
Staff loan 62,748,732 57,798,893
Small and medium enterprise (SME) 572,804,195 502,336,903
Transport loan 127,487,369 151,440,792
Term loan- industrial 1,407,720,100 1,142,398,662
Term loan- others/ Hire purchase under Shirkatul Melk 2,418,146,709 3,000,553,873
Foreign bills purchased 11,894,343 9,670,482
Local bills purchased 123,408,958 86,662,040
Total interest/profit on loans and advances/investments 14,427,449,731 13,632,113,166
Interest/profit on balance with other banks and financial institutions 1,421,864,872 468,835,597
Interest/profit received from foreign banks 13,788,868 3,976,317
15,863,103,471 14,104,925,081
20(a) Consolidated Interest income/profit on investments
Bank Asia limited 16,411,574,859 14,569,387,489
Bank Asia Securities Ltd 298,115,773 226,189,776
BA Exchange Company (UK) Limited - -
BA Express USA, Inc - -
16,709,690,632 14,795,577,265
Less: Inter-company transactions 172,215,771 -
16,537,474,861 14,795,577,265

21 Interest paid/profit shared on deposits and borrowings etc.

Conventional and Islamic banking (Note 21.1) 10,484,285,743 10,300,330,443
Off-shore banking unit 418,878,994 409,692,362
10,903,164,737 10,710,022,805
Less: inter transaction with OBU 51,807,903 109,087,550
Less: Inter-company transactions with Bank Asia Islamic Window 9,800,000 -
10,841,556,834 10,600,935,255

21.1 Conventional and Islamic banking

Interest paid/profit shared on deposits
Fixed deposits/ Mudaraba Fixed deposit 3,257,995,497 3,871,048,198
Scheme deposits 4,937,030,145 4,617,163,308

Bank Asia Limited

314
Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016
Sanchaya plus 89,200,882 144,491,564
Savings deposits/ Mudaraba Savings bank 786,116,667 680,546,235
Special notice deposits 624,236,722 540,400,067
9,694,579,913 9,853,649,372
Interest on borrowings and others
Local banks including Bangladesh Bank 60,087,340 21,315,793
Interest on subordinated non-covertable bond 729,541,025 425,234,045
Foreign banks 77,465 131,233
789,705,830 446,681,071
10,484,285,743 10,300,330,443

21(a) Consolidated Interest Expenses/profit paid on Deposits

Bank Asia limited 10,841,556,834 10,600,935,255
Bank Asia Securities Limited 184,387,803 6,989,416
Bank Asia Securities Ltd - -
BA Express USA, Inc - -
11,025,944,637 10,607,924,671
Less: Inter-company transactions 172,215,771 -
10,853,728,866 10,607,924,671

22 Investment income
Conventional and Islamic banking (Note 22.1) 2,535,391,259 3,548,303,241
Off-shore banking unit - -
2,535,391,259 3,548,303,241

22.1 Conventional and Islamic Banking

Interest on treasury bills 183,399,012 648,786,664
Interest on treasury bonds 1,922,333,615 2,089,331,564
Interest income on corporate bonds 153,115,193 148,517,916
Interest on Islamic bonds 16,120,284 18,482,265
Capital gain from investment in shares 24,672,598 51,878,470
Dividend on shares 53,427,973 41,515,740
Capital gain on Government securities 180,476,612 539,643,715
Interest income on investment in commercial paper - 8,615,515
Interest on reverse repo 1,845,972 1,531,392
2,535,391,259 3,548,303,241
22(a) Consolidated investment income
Bank Asia Limited 2,535,391,259 3,548,303,241
Bank Asia Securities Limited - -
BA Exchange Company (UK) Limited - -
BA Express USA, Inc - -
2,535,391,259 3,548,303,241
Less: Inter-company transactions - -
2,535,391,259 3,548,303,241

23 Commission, exchange and brokerage

Conventional and Islamic banking (Note 23.1) 3,109,688,825 2,467,536,202
Off-shore banking unit 10,127,463 7,325,078
3,119,816,288 2,474,861,280

Annual Integrated Report 2017

315
 Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016
23.1 Conventional and Islamic Banking
Commission on L/C 113,470,796 189,593,412
Commission on back to back L/C 767,688,052 605,147,066
Fees and commission 184,011,063 132,769,261
Commission on L/G 336,093,006 317,622,762
Commission on export 8,785,347 8,898,115
Commission on PO, DD, TT, TC, etc 22,055,095 17,603,994
Other commission 17,456,423 16,081,166
1,449,559,782 1,287,715,776
Foreign exchange gain 1,660,129,043 1,179,820,426
3,109,688,825 2,467,536,202
23(a) Consolidated Commission, exchange and brokerage
Bank Asia limited 3,119,816,288 2,474,861,280
Bank Asia Securities Ltd 176,746,029 103,998,719
BA Exchange Company (UK) Limited 20,402,724 18,112,898
BA Express USA, Inc 29,819,242 23,201,315
3,346,784,283 2,620,174,212
24 Other operating income
Conventional and Islamic banking (Note 24.1) 714,886,827 629,362,865
Off-shore banking unit 27,279,238 18,914,853
742,166,065 648,277,718
24.1 Conventional and Islamic banking
Locker charge 10,387,523 10,080,213
Service and other charges 356,336,486 322,070,208
Master/Visa card fees and charges 149,097,331 115,862,169
Postage/telex/SWIFT/fax recoveries 120,428,158 118,705,422
Profit on sale of fixed assets 3,188,186 1,952,999
Non-operating income 19,456,492 17,049,978
Rebate on nostro account 39,096,641 36,953,538
Other income from brokerage 16,896,010 6,688,338
714,886,827 629,362,865
24 (a) Consolidated other operating income
Bank Asia Limited 742,166,065 648,277,718
Bank Asia Securities Ltd 61,337,350 35,212,218
BA Exchange Company (UK) Limited 566,448 -
BA Express USA, Inc 573,688 -
804,643,551 683,489,936
25 Salaries and allowances
Conventional and Islamic banking (Note 25.1) 2,519,793,179 2,336,571,464
Off-shore banking unit - -
2,519,793,179 2,336,571,464
25.1 Conventional and Islamic banking
Basic salary 930,776,745 872,437,995
Allowances 959,958,404 906,167,001
Festival bonus 149,861,927 141,276,142
Gratuity 152,400,000 155,700,000
Provident fund contribution 86,796,103 80,990,326
Performance bonus 240,000,000 180,000,000
2,519,793,179 2,336,571,464
Bank Asia Limited
316
Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016
25(a) Consolidated Salaries and allowances
Bank Asia Limited 2,519,793,179 2,336,571,464
Bank Asia Securities Ltd 50,573,865 42,028,331
BA Exchange Company (UK) Limited 7,180,290 6,203,962
BA Express USA, Inc 17,507,091 18,314,075
2,595,054,425 2,403,117,832

26 Rent, taxes, insurance, electricity etc.

Conventional and Islamic banking (Note 26.1) 612,994,509 533,426,791
Off-shore banking unit 247,135 141,356
613,241,644 533,568,147

26.1 Conventional and Islamic banking

Rent, rate and taxes 369,427,578 303,906,722
Insurance 148,229,679 138,734,550
Power and electricity 95,337,252 90,785,519
612,994,509 533,426,791

26(a) Consolidated Rent, taxes, insurance, electricity etc.

Bank Asia Limited 613,241,644 533,568,147
Bank Asia Securities Ltd 14,182,186 12,342,055
BA Exchange Company (UK) Limited 6,316,921 6,491,713
BA Express USA, Inc 6,773,489 6,359,671
640,514,240 558,761,586

27 Legal expenses
Conventional and Islamic banking (Note 27.1) 24,615,519 16,085,833
Off-shore banking unit - -
24,615,519 16,085,833

27.1 Conventional and Islamic Banking

Legal expenses 24,615,519 16,085,833
Other professional charges - -
24,615,519 16,085,833

27(a) Consolidated Legal expenses

Bank Asia Limited 24,615,519 16,085,833
Bank Asia Securities Ltd 117,658 148,955
BA Exchange Company (UK) Limited 626,697 407,380
BA Express USA, Inc 517,424 1,404,290
25,877,298 18,046,458

28 Postage, stamps, telecommunication etc.

Conventional and Islamic banking (Note 28.1) 88,768,867 81,079,521
Off-shore banking unit 775,147 522,209
89,544,014 81,601,730

28.1 Conventional and Islamic banking

Telephone, courier and postage 33,678,478 35,920,787
Master/VISA card process fee 33,132,275 30,222,931
ATM charge 2,981,026 520,992
SWIFT and Reuter charge 17,464,012 12,729,911

Annual Integrated Report 2017

317
 Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016
Internet 1,513,076 1,684,900
88,768,867 81,079,521

28(a) Consolidated Postage, stamps, telecommunication etc.

Bank Asia Limited 89,544,014 81,601,730
Bank Asia Securities Ltd 2,018,965 1,797,714
BA Exchange Company (UK) Limited 518,660 356,509
BA Express USA, Inc 371,951 315,527
92,453,590 84,071,480
29 Stationery, printing, advertisements etc.
Conventional and Islamic banking (Note 29.1) 97,294,316 90,091,796
Off-shore banking unit 110,926 42,406
97,405,242 90,134,202
29.1 Conventional and Islamic banking
Office and security stationery 49,039,075 45,163,284
Calendar, diary, souvenir, etc 9,838,308 8,014,065
ATM card /Supplies And Stationeries 8,061,021 5,215,665
Books and periodicals 1,474,664 1,833,732
Publicity and advertisement 28,881,248 29,865,050
97,294,316 90,091,796
29(a) Consolidated Stationery, printing, advertisements etc.
Bank Asia Limited 97,405,242 90,134,202
Bank Asia Securities Ltd 1,014,073 479,644
BA Exchange Company (UK) Limited 449,141 196,039
BA Express USA, Inc 1,298,010 717,915
100,166,466 91,527,800

30 Managing Director’s salary and fees

Basic salary 6,000,000 7,303,226
House rent allowance 1,500,000 1,125,806
Entertainment allowances 300,000 225,161
Incentive bonus 1,000,000 1,000,000
Festival bonus 1,100,000 1,200,000
Utility allowance and others 1,200,000 1,355,645
House maintenance allowance 600,000 485,323
Provident fund 600,000 730,323
Leave fare assistance 1,600,000 2,264,415
13,900,000 15,689,899

31 Directors’ fees
Directors’ fees 2,992,000 3,192,000

31(a) Consolidated Directors’ fees

Bank Asia Limited 2,992,000 3,192,000
Bank Asia Securities Ltd. 294,400 230,000
BA Exchange Company (UK) Limited - -
BA Express USA, Inc - -
3,286,400 3,422,000

Bank Asia Limited

318
Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016

32 Auditors’ fees
Audit fees 952,100 1,252,000
952,100 1,252,000
32(a) Consolidated Auditors fees
Bank Asia Limited 952,100 1,252,000
Bank Asia Securities Ltd 95,833 95,833
BA Exchange Company (UK) Limited 619,282 603,419
BA Express USA, Inc 1,439,369 1,387,754
3,106,584 3,339,006

33 Depreciation and repair of Bank’s assets

Conventional and Islamic banking (Note 33.1) 459,920,443 469,051,286
Off-shore banking unit - -
459,920,443 469,051,286

33.1 Conventional and Islamic banking

Depreciation
Owned assets 392,509,290 398,031,506
Leased assets 800,000 800,000
393,309,290 398,831,506
Repairs
Building 6,965,106 14,600,477
Furniture and fixtures 329,397 543,314
Equipments 3,601,849 4,443,826
10,896,352 19,587,617
Maintenance 55,714,801 50,632,163
459,920,443 469,051,286

33(a) Consolidated Depreciation and repairs of Bank’s assets

Bank Asia Limited 459,920,443 469,051,286
Bank Asia Securities Ltd 822,184 506,476
BA Exchange Company (UK) Limited 1,722,413 1,642,031
BA Express USA, Inc 1,590,784 1,933,376
464,055,824 473,133,169

34 Other expenses
Conventional and Islamic banking (Note 34.1) 1,444,912,050 1,162,416,294
Off-shore banking unit 12,558,669 9,697,108
1,457,470,719 1,172,113,402

34.1 Conventional and Islamic banking

Car expenses 306,915,686 271,517,205
Contractual service expenses 487,574,969 391,765,827
Computer expenses 143,569,921 131,235,345
Other management and administrative expenses 199,285,973 154,182,500
Entertainment 44,352,850 45,061,565
AGM/EGM expenses 2,348,470 7,146,730
Payment to superannuation fund 7,320,000 2,810,000

Annual Integrated Report 2017

319
 Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016
Finance charge for lease assets 107,864 148,357
Donation and subscription to institutions 201,402,222 112,148,991
Travelling expenses 35,447,209 33,556,396
Training and internship 14,865,473 12,250,010
Directors' travelling expenses 1,221,413 93,368
Sharia council fees 500,000 500,000
1,444,912,050 1,162,416,294
34(a) Consolidated other expenses
Bank Asia Limited 1,457,470,719 1,172,113,402
Bank Asia Securities Ltd 27,966,687 17,953,106
BA Exchange Company (UK) Limited 3,100,323 2,114,756
BA Express USA, Inc 10,917,158 8,871,887
1,499,454,887 1,201,053,151
34(b) Provision for loans and advances/investments and off-balance sheet items
Conventional and Islamic banking 2,557,148,333 2,642,981,144
Off-shore banking unit 72,879,685 (9,252,181)
2,630,028,018 2,633,728,963
Break up of provision for loans and advances/Investments is shown below:
General provision
Conventional and Islamic banking 1,097,677,398 565,536,497
Off-shore banking unit 74,076,620 (9,743,441)
1,171,754,018 555,793,056
Specific provision
Conventional and Islamic banking 1,234,895,000 1,828,486,005
Off-shore banking unit - -
1,234,895,000 1,828,486,005
Provision for off-balance sheet items
Conventional and Islamic banking 224,575,935 138,958,642
Off-shore banking unit (1,196,935) 491,260
223,379,000 139,449,902
Provision for diminution in value of investments - 110,000,000
Other provisions - -
2,630,028,018 2,633,728,963
34(c) Consolidated Provision for loans and advances/investments
Bank Asia Limited 2,630,028,018 2,633,728,963
Bank Asia Securites Limited:
Specific Provision 105,000,000 100,000,000
Provision for diminution in value of investments 906,056 11,619,793
Other provisions - -
105,906,056 111,619,793
BA Exchange Company (UK) Limited - -
BA Express USA, Inc - -
2,735,934,074 2,745,348,756
35 Receipts from other operating activities
Conventional and Islamic banking (Note 35.1) 920,036,037 1,220,885,050
Off-shore banking unit 27,279,238 18,914,853
947,315,275 1,239,799,903

Bank Asia Limited

320
Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016
35.1 Conventional and Islamic banking
Locker charge 10,387,523 10,080,213
Service and other charges 356,336,486 322,070,208
Master card fees and charges 149,097,331 115,862,169
Postage/telex/SWIFT/ fax recoveries 120,428,158 118,705,422
Non-operating income 283,786,539 654,167,038
920,036,037 1,220,885,050

35(a) Consolidated Receipts from other operating activities

Bank Asia Limited 947,315,275 1,239,799,903
Bank Asia Securities Ltd 61,337,350 35,212,218
BA Exchange Company (UK) Limited 566,448 -
BA Express USA, Inc 573,688 -
1,009,792,761 1,275,012,121
Less: inter- companies transactions -
1,009,792,761 1,275,012,121

36 Payments for other operating activities

Conventional and Islamic banking (Note 36.1) 2,190,677,383 1,813,516,190
Off-shore banking unit 12,805,804 9,838,464
2,203,483,187 1,823,354,654

36.1 Conventional and Islamic banking

Rent, rates and taxes 612,994,509 533,426,791
Legal expenses 24,615,519 16,085,833
Directors' fees 2,992,000 3,192,000
Postage, stamp, telecommunication, etc 89,544,014 81,601,730
Other expenses 1,445,679,241 1,162,267,937
Managing Director's salary 13,900,000 15,689,899
Auditors' fee 952,100 1,252,000
2,190,677,383 1,813,516,190

36(a) Payments for other operating activities

Bank Asia Limited 2,203,483,187 1,823,354,654
Bank Asia Securities Ltd 44,675,729 32,567,663
BA Exchange Company (UK) Limited 11,181,883 9,973,777
BA Express USA, Inc 20,019,391 18,339,129
2,279,360,190 1,884,235,223

37 Earnings per share (EPS)

Net profit after tax (Numerator) 2,047,528,759 1,545,905,547
Number of ordinary shares outstanding (Denominator) 881,259,910 881,259,910
Issue of bonus shares 12% 105,751,189 105,751,189
Number of ordinary shares outstanding (Denominator) 987,011,099 987,011,099
Earnings per share (EPS) 2.07 1.57

Earnings per share has been calculated in accordance with BAS 33: “Earnings Per Share (EPS)”. Earnings per share for previous year
has been restated since the bonus issue is an issue without consideration of cash. It is treated as if it has occurred prior to the begin-
ning of 2016, the earliest period reported. Actual EPS for December 2016 was Taka 1.75

Annual Integrated Report 2017

321
 Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016
37(a) Consolidated Earnings per share (EPS)
Net profit after tax (Numerator) 2,112,089,343 1,644,066,246
Number of ordinary shares outstanding (Denominator) 987,011,099 987,011,099
Earnings per share (EPS) 2.14 1.67
38 Number of employees
The number of employees receiving remuneration of Taka 36,000 or above per employee per year were 2,087 (2016: 1,970).

39 Audit committee
The Audit Committee of the Board of Directors of Bank Asia Limited was constituted in the 44th meeting of the Board held on Janu-
ary 18, 2003 in compliance with the Bangladesh Bank directives. The Audit Committee was formed with the objectives to establish a
platform for a compliant and secured banking structure in the Bank. The present Audit Committee was reconstituted by the Board in
the 364th meeting held on July 03, 2017 consisting of the following members:

Name Status in the Audit Committee Educational qualification

Mr. Mashiur Rahman Chairman M.Com
Mr. Mohd. Safwan Choudhury Member BA (Hon's) MA
Mr. A M Nurul Islam Member BA (Hon's) MA

The Company Secretary of the Bank acts as the Secretary of the Committee.
No. of meeting Date No. of meeting Date
185th Audit 31st Jan, 2017 190th Audit 08th June, 2017
186th Audit 28th Feb, 2017 191st Audit 27th July, 2017
187th Audit 05th April, 2017 192nd Audit 14th September, 2017
188th Audit 16th April, 2017 193rd Audit 29th October, 2017
189th Audit 27th April, 2017

In the year 2017, 9 (nine) meetings of the Audit Committee were held in which, the following issues, amongst others,
were reviewed and discussed:

1 “External Audit Report of the Bank and the recommendations made there under.
2 Bangladesh Bank comprehensive inspection report and the recommendations made there under.
3 Audit and Inspection reports on the branches, divisions and departments of the Corporate Office prepared by the Internal Control
and Compliance Division (ICCD) of the Bank.
4 Actions taken by the management in regard to deficiencies raised in the Bangladesh Bank Inspection report and by the
Internal Audit and Inspection Team of the Bank.
5 The corrective measures taken by the management in regard to the lapses pointed out on the internal control and other issues as
are raised by internal and external auditors and inspectors of the regulatory authority.
6 The compliance status of the audit objections and the recommendations made by the Bangladesh Bank inspectors, External
Auditors and the Internal Auditors in the reports.
7 Management Report on Accounts of the Bank for the year ended on 31.12.2016.
8 Implementation of Core Risk Management Guidelines including Internal Control and Compliance Risk along with compliance
thereof.
9 The review of status of recovery of classified loans and providing with the necessary guidelines to the management to
contain the NPLs.

The Audit Committee has further satisfied that

* The rules and regulations of the Bangladesh Bank and all other regulatory authorities and Bank’s own policy guidelines
approved by the Board of Directors are duly complied with.
* Internal control and security measures have been adequately undertaken by the Bank towards facilitating Information
Technology (IT) based banking including generation of proper Management Information System (MIS).
* The system of internal control and the business processes have been strengthened including development of human resources
towards creation of a compliance culture in the Bank.
* The efforts have been made to keep assets of the Bank safe along with liabilities and commitments are made transparent.

Bank Asia Limited

322
Notes to the
financial statements

Amount in Taka
31 Dec 2017 31 Dec 2016
* The Financial Statements of the Bank have been prepared in accordance with Bangladesh Financial Reporting Standards (BFRS)
and contained full disclosure.
40 RELATED PARTY TRANSACTIONS
While making any related party transactions the management always pays proper attention to economic efficiency and competitive
pricing and necessary approval of Bangladesh Bank and other authorities had been obtained wherever applicable. Significant related
party transactions of the Bank for the period January – December 2017 is given below:
Name of Organiza- Transaction
Relationship Service Type
tion amount (Tk.)
Rangs Properties "Common Directors & Close family members Director” Office Rent 63,744,958
Agro Food Services Ltd. -do- Office Rent 19,846,948
Ranks Telecom -do- Mobile Phone 12,591
Romask Ltd -do- Printing 31,703,018
Rangs Industries Ltd. -do- Electronics items providers 634,400
Rangs Limited -do- Car providers 8,798,715
Rancon Service Ltd. -do- Electric equipment Maintenance 2,713,486
Rangs workshop Ltd -do- Car repair and Services 1,344,489
Ranks ITT Ltd. -do- Network Connectivity fees 48,974,009
Garda Shield Security
-do- Electric equipment Maintenance 10,266,147
Service
Shield Security Service -do- Security Service providers 167,797,163
The Shokaler Khabor -do- Advertising 3,602,630
The Daily Star -do- Advertising 6,513,382
ZRC Engineering Close family members Director Transportation 2,597,283
Reliance Insurance -do- Insurance Service 17,837,243
Green Bangla -do- Tree Plantation 692,532
ERA Infotech Associate Company Software vendor 98,517,024
Total 485,596,016

During the year 2017 Directors and their interest in different entities are given in Annexure F

The Bank sanctioned the following facilities in favor of the Phulbari Tea Estates Ltd. and M. Ahmed Tea & Lands Co. Ltd. during the year 2017.
Name of the director having interest Nature of facility Limit (Taka) Outstanding balance as at 31
December 2017 (Taka)
Mr. Mohd. Safwan Chowdhury Bank Guarantee (Secured by FDR) 434,133 434,133

41 COVERAGE OF EXTERNAL AUDIT

The external auditors of the Bank, ACNABIN, Chartered Accountants worked about 5,250 person hours. They have reviewed more
than 80% of the Bank’s risk weighted assets as at the Balance Sheet date.
42 SHARE TRADING
The bank started trading its ordinary shares in CDBL on 30 January 2006. The closing market price on 31 December 2017 was Tk.
23.10 (2016: Tk.17.90) at DSE and Tk. 23.10 at CSE (2016: 18.20).
43 EVENTS AFTER THE REPORTING PERIOD
The Board of Directors in its 380th meeting held on April 08, 2018 has recommended stock dividend @ 12.5% subject to the
approval of the shareholders at the next Annual General Meeting.

Other than this, no material events which have occurred after the reporting period which could affect the values stated in the
financial statements.

Annual Integrated Report 2017

323
324
Bank Asia Limited
Highlights on the overall activities
as at and for the year ended 31 December 2017

Amount in Taka Amount in USD

Sl no. Particulars
2017 2016 2017 2016
1 Paid-up capital 9,870,110,990 8,812,599,100 119,348,379.56 106,561,053.20
2 Total capital 32,913,956,465 24,774,601,889 397,992,218.44 299,571,969.64
3 Capital (deficit)/surplus 10,802,491,519 4,825,532,799 130,622,630.21 58,349,852.47
4 Total assets 288,996,642,751 253,195,701,236 3,494,518,050.20 3,061,616,701.76
5 Total deposits 207,041,471,381 191,272,582,777 2,503,524,442.33 2,312,848,643.01
6 Total loans and advances / investments 197,504,138,756 163,609,782,739 2,388,199,984.96 1,978,352,874.72
7 Total contingent liabilities and commitments 136,156,444,076 110,762,047,002 1,646,389,892.09 1,339,323,422.03
8 Credit deposit ratio 81.88% 76.15% 81.88% 76.15%
Percentage of classified loans / investments against total loans and advances / invest-
9 4.38% 5.41% 4.38% 5.41%
ments
10 Profit after tax and provision 2,047,528,759 1,545,905,547 24,758,509.78 18,692,932.85
11 Amount of classified loans/investments during current year 8,642,303,000 8,847,339,000 104,501,850.06 106,981,124.55
12 Provisions kept against classified loans / investments 3,739,999,617 4,494,285,907 45,223,695.49 54,344,448.69
13 Provision surplus against classified loans / investments 7,310,617 - 88,399.24 -
14 Cost of fund 7.73% 8.22% 7.73% 8.22%
15 Interest earning assets 256,765,518,564 223,223,170,240 3,104,782,570.30 2,699,191,901.33
16 Non-interest earning assets 32,231,124,188 29,972,530,996 389,735,479.90 362,424,800.44
17 Return on investment (ROI) [PAT/(Shareholders' equity + Borrowing)] 3.45% 3.77% 3.45% 3.77%
18 Return on assets (ROA) [PAT/ Average assets] 0.76% 0.65% 0.76% 0.65%
19 Income from investment 2,535,391,259 3,548,303,241 30,657,693.58 42,905,722.38
20 Capital adequacy 14.89% 12.42% 14.89% 12.42%
21 Earnings per share 2.07 1.57 0.03 0.02
22 Net income per share 2.07 1.57 0.03 0.02
23 Price earning ratio 11.14 10.53 11.14 10.53

Exchange Rate used 1 USD equivalent to BDT 82.70 (2016 BDT 78.65)

Bank Asia Limited

 Annex A
Bank Asia Limited
Balance with other banks-Outside Bangladesh (Nostro Account)
as at 31 December 2017
2017 2016
Account Currency
Name of the Bank Exchange Equivalent Exchange Equivalent
type type FC amount FC amount
rate Taka rate Taka

Annual Integrated Report 2017

Conventional and Islamic banking:
Interest bearing
Citibank N.A., London CD EURO 248,923 98.16 24,434,287 252,211 82.00 20,681,324
Citibank N.A., London CD GBP 81,828 110.56 9,046,861 39,054 98.00 3,827,315
Citibank NA, New York CD USD 2,951,258 82.70 244,077,093 10,073,103 78.70 792,753,215
Habib American Bank, New York CD USD 1,823,502 82.70 150,820,201 65,240 78.70 5,134,397
Mashreqbank psc, New York CD USD 221,387 82.70 18,315,806 7,381 78.70 580,871
Standard Chartered Bank, Mumbai CD ACU 49,956 82.70 4,131,323 1,300,456 78.70 102,345,892
Standard Chartered Bank, New York CD USD 679,854 82.70 56,220,625 1,860 78.70 146,366
507,046,196 925,469,380
Non-interest bearing :
AB Bank Ltd, Mumbai CD ACU 467,006 82.70 38,621,372 180 78.70 14,174
Al Rajhi Bank, KSA CD SAR 817 22.00 17,982 41,817 22.00 919,982
Bank of Tokyo-Mitsubishi CD JPY 24,642,746 0.74 18,235,632 2,096,463 0.70 1,467,524
Bank of Sydney CD AUD 12,287 63.82 784,152 1,533 56.00 85,845
Bhutan National Bank Ltd, Thimphu CD USD 28,934 82.70 2,392,802 11,410 78.70 897,984
Commerzbank AG, Frankfurt CD USD 11,412 82.70 943,737 562,091 78.70 44,236,583
Caisse Centrale Desjardins CD CAD - - - 10,713 58.00 621,340
Commerzbank AG, Frankfurt CD EURO 1,354,581 98.16 132,965,792 631,030 82.00 51,744,589
Habib Bank UK. London CD GBP - - - 523 98.00 51,274
Habib Metropolitan Bank Ltd, Karachi CD ACU 117,898 82.70 9,754,377 100,740 78.70 7,928,216
ICICI Bank Ltd, Hongkong CD USD 4,389 82.70 362,987 173 78.70 13,614
ICICI Bank Ltd, Mumbai CD ACU 12,162 82.70 1,023,138 287,125 78.70 22,596,744
JP Morgan Chase Bank, New York CD USD 165,829 82.70 13,714,038 443 78.70 34,890
Mashreqbank psc, Mumbai (EURO) CD EURO 8,054 98.16 790,571 8,054 82.00 660,420
Muslim Commercial Bank Ltd, Colombo CD ACU 19,699 82.70 1,629,075 53,374 78.70 4,200,567
Nepal Bangladesh Bank Ltd, Kathmandu CD ACU 166,426 82.70 13,763,471 52,047 78.70 4,096,072
Sonali Bank, USD CD USD - - - 490 78.70 38,564
Saudi Hollandi Bank, KSA CD SAR 246,700 22.00 5,427,400 1,397 22.00 30,734
Unicredit Bank AG Munich CD EURO 6,851 98.16 672,514 1,930 82.00 158,292
UBAF, Tokyo CD JPY - - - 69,795 0.70 48,857
Wells Fargo Bank N.A, New York CD USD 647,152 82.70 53,519,499 358 78.70 28,198
Wells Fargo Bank N.A, London CD EURO 658 98.16 64,571 4,326 82.00 354,710
Zurcher Kantonal Bank, Switzerland CD CHF 9,776 83.80 819,264 9,697 80.00 775,743
295,502,374 141,004,917
Off-shore banking unit:
Commerzbank AG, Frankfurt CD EURO 30,083 98.16 2,466,829 349 82.00 28,626
Habib American Bank, New York CD USD 382,232 82.70 31,342,999 19,125,851 78.65 1,504,248,145
Sonali Bank, London CD GBP 5 110.56 431 4 98.00 413
33,810,259 1,504,277,184
836,358,829 2,570,751,481

325
326
Annex B
Bank Asia Limited
Investment in Shares
as at 31 December 2017

Provision Requirement
Unrealized
No. of shares Quoted rate Total market
SL. Cost of Cost profit/ (loss) as
Name of the company Face including per share value as at
No. holding Per Share at 31 Dec 2017
value bonus shares 31 Dec 2017 31 Dec 2017
Quoted Shares
1 Khulna Power Company 10 4,265 406,760 95.37 58.50 249,503 (157,257)
2 AB Bank Limited 10 141,912 9,720,972 68.50 22.10 3,136,255 (6,584,717)
3 Dhaka Bank Limited 10 472,549 15,811,490 33.46 22.00 10,396,078 (5,415,412 )
4 Exim Bank Limited 10 1,877,123 38,582,386 20.55 17.20 32,286,516 (6,295,871)
5 Golden Son Limited 10 119,185 8,586,791 72.05 12.80 1,525,568 (7,061,223)
6 Lanka Bangla Finance Limited 10 1,160,592 59,762,751 51.49 47.80 55,476,298 (4,286,453)
7 Mercant Bank Limited 10 400,000 10,496,000 26.24 26.40 10,560,000 64,000
8 Phoenix Finance and Investments Limited 10 1,024,148 49,442,486 48.28 37.70 38,610,380 (10,832,106)
9 Prime Finance & Investment Limited 10 72,576 12,001,821 165.37 12.20 885,427 (11,116,393)
10 Prime Insurance Company Limited 10 60,564 5,466,943 90.27 19.20 1,162,829 (4,304,114)
11 Pubali Bank Limited 10 6 208 34.65 30.40 182 (25)
12 Reliance Insurance Limited 10 115,684 7,343,620 63.48 54.70 6,327,915 (1,015,706)
13 Southeast Bank Limited 10 1,072,181 34,732,660 32.39 22.20 23,802,418 (10,930,242)
14 United Commercial Bank Limited 10 2,272,192 63,772,931 28.07 23.60 53,623,731 (10,149,200)
15 Premier Bank Limited 10 3,586,004 66,807,255 18.63 15.70 56,300,263 (10,506,992)
16 The ACME Laboratories Limited 10 1,000,000 57,650,000 57.65 114.00 114,000,000 56,350,000
A. Provision requirement for quoted shares 440,585,072 408,343,362 (32,241,710)
Available cash balance 38,068,506
478,653,578
Mutual Fund
17 1st Janata Bank Mutual Fund 10 6,886,582 50,000,000 7.26 6.40 44,074,125 -
18 MBL 1st Mutual Fund 10 5,000,000 50,000,000 10.00 9.10 45,500,000 -
19 EBL NRB Mutual Fund 10 21,099,495 149,665,000 7.09 6.60 139,256,667 -
20 First Bangladesh Fixed Income Fund 10 36,673,402 250,000,000 6.82 5.70 209,038,391 -
21 EXIM Bank 1st Mutual Fund 10 32,204,147 242,235,820 7.52 7.00 225,429,029 -
22 UFS-Bank Asia Unit Fund 10,000,000 100,000,000 10.00 10.00 100,000,000 -
Provision requirement for Mutual Fund 111,863,626 841,900,820 763,298,212 -
B. Provision requirement for Mutual Fund as per BB Circular -

Bank Asia Limited

 Provision Requirement
No. of Shares
Sl. Face Cost of Per Unit Per share Total book Unrealized profit

Annual Integrated Report 2017

Name of the company including
No. value holding cost (NAV) value (loss)
bonus
Unquoted Shares
1 Industrial & Infrastructure Development Finance 10 7,329,110 29,683,820 4.05 16.49 120,828,120 91,144,300
Co. Ltd.
2 Central Depository Bangladesh Limited 10 1,142,361 3,138,890 2.75 33.01 37,711,228 34,572,338
3 Era-Infotech Limited 100 3,837 383,700 100.00 6,635.45 25,460,235 25,076,535
4 Bangladesh Rating Agency Limited 100 32,015 3,201,512 100.00 3.07 98,206 (3,103,306)
5 MSF Asset Management Co. Ltd. 10 200,000 2,000,000 10.00 10.00 2,000,000 -
6 Investment in SWIFT share 247,615 22 5,447,533 22.00 233,542.73 5,137,940 (309,593)
7 Energypac Power Generation Limited 10 1,192,800 49,984,000 41.90 36.15 43,120,160 (6,863,840)
8 Provision required for subsidiaries (127,000,000)
C. Provision of unquoted stocks 13,516,433
E. Total Provision Requirement (A+B+C) (18,725,277)
E. Provision maintained 253,383,553
F. Provision Excess / (Shortfall) for quoted and unquoted share 234,658,276

327
328
Bank Asia Limited Annex C-1
Conventional Banking, Islamic Banking and Off-shore Banking unit
Schedule of fixed assets including premises, furniture and fixtures
as at 31 December 2017

Cost Depreciation
Charged
Rate Written
Revalua- Disposal/ from Disposal/
Addition Balance of Balance Charged Balance down value
Particulars Balance tion adjustment Revaluation adjustment
during as at dep. as at during as at as at
as at during during reserve during
the year 31 Dec 2017 % 01 Jan 2017 the year 31 Dec 2017 31 Dec 2017
01 Jan 2017 the year the year during the the year
year
Own assets
Land 2,646,764,306 - - - 2,646,764,306 - - - - - - 2,646,764,306
Building 2,570,079,638 132,832,766 - - 2,702,912,404 5 783,445,494 87,629,472 51,317,184 - 922,392,150 1,780,520,254
Furniture and fixtures 983,411,842 116,550,628 - (2,647,000) 1,097,315,470 20 747,530,588 105,712,914 - (1,512,007) 851,731,495 245,583,975
Equipments 676,609,838 110,740,593 - (2,198,927) 785,151,504 20 460,858,855 79,489,438 - (2,156,255) 538,192,038 246,959,466
Computer and
349,594,549 55,656,318 - (292,300) 404,958,567 20 217,987,151 46,567,977 - (165,712) 264,389,416 140,569,151
accessories
Motor vehicles 195,606,754 8,087,846 - (8,962,000) 194,732,600 20 139,894,370 19,394,225 - (8,962,000) 150,326,595 44,406,005
Sub-total 7,422,066,928 423,868,151 - (14,100,227) 7,831,834,852 2,349,716,458 338,794,026 51,317,184 (12,795,974) 2,727,031,694 5,104,803,158

Leased assets
Building 49,573,087 - - - 49,573,087 5 23,988,466 800,000 2,398,080 - 27,186,546 22,386,541
Furniture and fixtures 167,162,848 - - - 167,162,848 20 167,162,848 - - - 167,162,848 -
Equipments 106,201,139 - - - 106,201,139 20 106,201,139 - - - 106,201,139 -
Computer and
72,204,100 - - - 72,204,100 20 72,204,100 - - - 72,204,100 -
accessories
Motor vehicles 18,900,000 - - - 18,900,000 20 18,900,000 - - - 18,900,000 -
Sub-total 414,041,174 - - - 414,041,174 388,456,553 800,000 2,398,080 - 391,654,633 22,386,541
Total 7,836,108,102 423,868,151 - (14,100,227) 8,245,876,026 2,738,173,011 339,594,026 53,715,264 (12,795,974) 3,118,686,327 5,127,189,699

Work in progress -building

Kawran bazar * 52,065,908 111,251,220 - - 163,317,128 - - - - - 163,317,128
Lalmatia** 92,515,444 34,412,036 - (126,927,480) - - - - - - -
Sukrabad *** 7,206,045 32,027,627 - - 39,233,671 - - - - - 39,233,671
Total 151,787,396 177,690,882 - (126,927,480) 202,550,799 - - - - - 202,550,799
Grand Total 7,987,895,498 601,559,033 - (141,027,707) 8,448,426,824 2,738,173,011 339,594,026 53,715,264 (12,795,974) 3,118,686,327 5,329,740,498

* For construction of 12 storied commercial building with 22 storied foundation

** For construction of 6 storied building over the existing 2 storied building
*** For construction of 9 storied building

Bank Asia Limited

 Annex C-2
Bank Asia Limited
Conventional and Islamic banking
Schedule of fixed assets including premises, furniture and fixtures
as at 31 December 2016
Cost Depreciation
Charged

Annual Integrated Report 2017

Reval- Rate Written
Disposal/ from Disposal/
Addition uation Balance of Balance Charged Balance down value
Particulars Balance adjustment Revaluation adjustment
during during as at dep. as at during as at as at
as at during reserve during
the year the 31 Dec 2016 % 01 Jan 2016 the year 31 Dec 2016 31 Dec 2016
01 Jan 2016 the year during the the year
year
year
Own assets
Land 2,643,839,095 2,925,211 - - 2,646,764,306 - - - - - - 2,646,764,306
Building 2,432,146,347 137,933,291 - - 2,570,079,638 5 618,489,385 84,958,297 79,997,812 - 783,445,494 1,786,634,144
Furniture and fixtures 911,815,957 75,150,785 - (3,554,900) 983,411,842 20 642,925,714 106,248,181 - (1,643,308) 747,530,587 235,881,255
Equipments 561,316,507 115,293,331 - - 676,609,838 20 394,312,777 66,546,078 - - 460,858,855 215,750,983
Computer and acces-
254,308,476 95,286,073 - - 349,594,549 20 181,160,698 36,826,453 - - 217,987,151 131,607,398
sories
Motor vehicles 178,652,984 24,178,770 - (7,225,000) 195,606,754 20 125,867,362 21,252,008 - (7,225,000) 139,894,370 55,712,384
Sub-total 6,982,079,367 450,767,461 - (10,779,900) 7,422,066,928 1,962,755,936 315,831,018 79,997,812 (8,868,308) 2,349,716,458 5,072,350,470

Leased assets
Building 49,573,087 - - - 49,573,087 5 20,985,790 800,000 2,202,676 - 23,988,466 25,584,621
Furniture and fixtures 167,162,848 - - - 167,162,848 20 167,162,848 - - - 167,162,848 -
Equipments 106,201,139 - - - 106,201,139 20 106,201,139 - - - 106,201,139 -
Computer and
72,204,100 - - - 72,204,100 20 72,204,100 - - - 72,204,100 -
accessories
Motor vehicles 18,900,000 - - - 18,900,000 20 18,900,000 - - - 18,900,000 -
Sub-total 414,041,174 - - - 414,041,174 385,453,877 800,000 2,202,676 - 388,456,553 25,584,621
Total 7,396,120,541 450,767,461 - (10,779,900) 7,836,108,102 2,348,209,813 316,631,018 82,200,488 (8,868,308) 2,738,173,011 5,097,935,091

Work in progress -building

Kawran bazar* 11,476,071 40,589,837 - - 52,065,908 - - - - - 52,065,908
Lalmatia** 16,120,000 76,395,443 - - 92,515,443 - - - - - 92,515,443
Sukrabad*** - 7,206,045 - - 7,206,045 - - - - - 7,206,045
Total 27,596,071 124,191,325 - - 151,787,396 - - - - - 151,787,396
Grand Total 7,423,716,612 574,958,786 - (10,779,900) 7,987,895,498 2,348,209,813 316,631,018 82,200,488 (8,868,308) 2,738,173,011 5,249,722,487

* For construction of 12 storied commercial building with 22 storied foundation

** For construction of 6 storied building over the existing 2 storied building
*** For construction of 9 storied building

329
330
Annex C-3
Bank Asia Limited and its Subsidiaries
Consolidated Schedule of fixed assets including premises, furni-
ture and fixtures
as at 31 December 2017

Cost Depreciation
Charged
Written
Disposal/ Rate from Disposal/
Balance Additions Balance Balance Charged Balance down value
Particulars adjustment of Revaluation adjustment
as at during as at as at during as at as at
during dep. reserve during
01 Jan 2017 the year 31 Dec 2017 01 Jan 2017 the year 31 Dec 2017 31 Dec 2017
the year % during the year
the year
Own assets
Land 2,646,764,306 - - 2,646,764,306 0 - - - - - 2,646,764,306
Building 2,570,079,638 132,832,766 - 2,702,912,404 5 784,213,494 87,629,472 51,317,184 (768,000) 922,392,150 1,780,520,254
Furniture and fixtures 994,976,143 116,622,870 911,951 1,112,510,964 20 756,810,854 105,911,801 - 2,402,503 865,125,158 247,385,806
Equipments 683,617,875 111,392,643 (3,490,513) 791,520,005 20 468,072,631 79,645,106 - (3,888,770) 543,828,967 247,691,038
Computer and accessories 357,632,359 58,695,668 62,512 416,390,539 20 225,499,467 47,197,971 - (165,712) 272,531,726 143,858,813
Motor vehicles 195,606,754 8,087,846 (8,962,000) 194,732,600 20 139,894,370 19,394,225 - (8,962,000) 150,326,595 44,406,005
Sub-total 7,448,677,075 427,631,793 (11,478,049) 7,864,830,819 2,374,490,816 339,778,575 51,317,184 (11,381,979) 2,754,204,596 5,110,626,222

Leased assets
Building 71,475,851 - (91,204) 71,384,647 5 34,301,037 3,611,933 2,398,080 19,712 40,330,762 31,053,886
Furniture and fixtures 167,162,848 - - 167,162,848 20 167,162,848 - - - 167,162,848 -
Equipments 106,201,139 - - 106,201,139 20 106,201,139 - - - 106,201,139 -
Computer and accessories 72,204,100 - - 72,204,100 20 72,204,100 - - - 72,204,100 -
Motor vehicles 18,900,000 - - 18,900,000 20 18,900,000 - - - 18,900,000 -
Sub-total 435,943,938 - (91,204) 435,852,734 398,769,124 3,611,933 2,398,080 19,712 404,798,849 31,053,886
Total 7,884,621,013 427,631,793 (11,569,253) 8,300,683,553 2,773,259,941 343,390,508 53,715,264 (11,362,267) 3,159,003,445 5,141,680,108
Work in progress - building

Kawran bazar* 52,065,908 111,251,220 - 163,317,128 - - - - - 163,317,128

Lalmatia** 92,515,444 34,412,036 (126,927,480) - - - - - - -
Sukrabad*** 7,206,045 32,027,627 - 39,233,672 - - - - - 39,233,672
Total 151,787,397 177,690,882 (126,927,480) 202,550,799 - - - - - 202,550,799
Grand Total 8,036,408,410 605,322,675 (138,496,732) 8,503,234,352 - 2,773,259,941 343,390,508 53,715,264 (11,362,267) 3,159,003,445 5,344,230,907

* For construction of 12 storied commercial building with 22 storied foundation

** For construction of 6 storied building over the existing 2 storied building
*** For construction of 9 storied building

Bank Asia Limited

 Bank Asia Limited and its Subsidiaries Annex C-4
Consolidated Schedule of fixed assets including premises,
furniture and fixtures
as at 31 December 2016

Cost Depreciation

Annual Integrated Report 2017

Charged
Written
Disposal/ Rate from Disposal/
Balance Additions Balance Balance Charged Balance down value
Particulars adjustment of Revaluation adjustment
as at during as at as at during as at as at
during dep. reserve during
01 Jan 2016 the year 31 Dec 2016 01 Jan 2016 the year 31 Dec 2016 31 Dec 2016
the year % during the year
the year
Own assets
Land 2,643,839,095 2,925,211 - 2,646,764,306 0 - - - - - 2,646,764,306
Building 2,432,146,347 137,933,291 - 2,570,079,638 5 619,257,385 84,958,297 79,997,812 - 784,213,494 1,785,866,144
Furniture and fixtures 923,140,145 75,390,898 (3,554,900) 994,976,143 20 652,013,239 107,148,571 - (2,350,956) 756,810,854 238,165,289
Equipments 568,117,908 115,499,967 - 683,617,875 20 401,391,547 66,681,084 - - 468,072,631 215,545,244
Computer and accessories 261,863,086 95,769,273 - 357,632,359 20 188,347,301 37,152,166 - - 225,499,467 132,132,892
Motor vehicles 178,652,984 24,178,770 (7,225,000) 195,606,754 20 125,867,362 21,252,008 - (7,225,000) 139,894,370 55,712,384
Sub-total 7,007,759,565 451,697,410 (10,779,900) 7,448,677,075 1,986,876,834 317,192,126 79,997,812 (9,575,956) 2,374,490,816 5,074,186,257

Leased assets
Building 72,964,732 - (1,488,881) 71,475,851 5 28,628,465 3,469,896 2,202,676 - 34,301,037 37,174,814
Furniture and fixtures 167,162,848 - - 167,162,848 20 167,162,848 - - - 167,162,848 -
Equipments 106,201,139 - - 106,201,139 20 106,201,139 - - - 106,201,139 -
Computer and accessories 72,204,100 - - 72,204,100 20 72,204,100 - - - 72,204,100 -
Motor vehicles 18,900,000 - - 18,900,000 20 18,900,000 - - - 18,900,000 -
Sub-total 437,432,819 - (1,488,881) 435,943,938 393,096,552 3,469,896 2,202,676 - 398,769,124 37,174,814
Total 7,445,192,384 451,697,410 (12,268,781) 7,884,621,013 2,379,973,387 320,662,022 82,200,488 (9,575,956) 2,773,259,941 5,111,361,071
Work in progress - building

Kawran bazar* 11,476,071 40,589,837 - 52,065,908 - - - - - 52,065,908

Lalmatia** 16,120,000 76,395,443 - 92,515,443 - - - - - 92,515,443
Sukrabad*** - 7,206,045 - 7,206,045 - - - - - 7,206,045
Total 27,596,071 124,191,325 - 151,787,396 - - - - - 151,787,396
Grand Total 7,472,788,455 575,888,735 (12,268,781) 8,036,408,409 - 2,379,973,387 320,662,022 82,200,488 (9,575,956) 2,773,259,941 5,263,148,467

* For construction of 12 storied commercial building with 22 storied foundation

** For construction of 6 storied building over the existing 2 storied building
*** For construction of 9 storied building

331
 Bank Asia Limited Annex D

Statement of tax position

as at 31 December 2017

Accounting Assessment Tax provision Tax demand as per Excess/(Short)

Status
year year as per accounts assessment order provision
2000 2001-2002 2,000,000 7,080,931 (5,080,931) Assessment finalized
2001 2002-2003 42,626,674 38,156,227 4,470,447 Assessment finalized
2002 2003-2004 91,950,000 83,933,056 8,016,944 Assessment finalized
2003 2004-2005 165,000,000 155,712,331 9,287,669 Assessment finalized
2004 2005-2006 166,807,728 187,552,594 (20,744,866) Assessment finalized
2005 2006-2007 220,089,576 273,929,209 (53,839,633) Assessment finalized
2006 2007-2008 432,447,206 433,037,008 (589,802) Assessment finalized
2007 2008-2009 704,871,326 707,990,638 (3,119,312) Assessment finalized
2008 2009-2010 790,000,000 715,369,681 74,630,319 Assessment finalized
2009 2010-2011 779,000,000 928,407,967 (149,407,967) Assessment finalized
At Honorable High Court
2010 2011-2012 1,498,735,610 1,874,438,423 (375,702,813)
Stage
Assessment at Appellate
2011 2012-2013 1,515,992,334 1,738,409,929 (222,417,595)
commissioner Level
2012 2013-2014 1,788,554,541 1,757,614,602 30,939,939 Assessment finalized
2013 2014-2015 2,041,583,693 1,598,721,337 442,862,356 Assessment finalized
2014 2015-2016 1,947,162,329 1,750,290,281 196,872,048 Assessment finalized
2015 2016-2017 1,534,738,646 1,402,006,013 132,732,633 Assessment finalized
2016 2017-2018 1,678,000,000 1,565,744,939 112,255,061 Return submitted

Bank Asia Limited

332
Bank Asia Limited Annex E

Details of Large Loan

as at 31 December 2017

2017 2016
Number of clients 13 17
Amount of outstanding advances (Taka) 58,770.96 57,429.58
Amount of classified advances (Taka) NIL NIL
Measures taken for recovery (Taka) NIL NIL

Client-wise break up is as follows

Amount in million
Outstanding (Taka) 2017 Outstanding (Taka) 2016
Sl.
Name of clients Non Non
No. Funded Total Funded Total
Funded Funded
1 S.A Group 3,566.44 - 3,566.44 3,372.53 78.65 3,451.18
2 Aman Group 3,241.23 1,004.39 4,245.62 2,759.15 844.42 3,603.57
3 Partex Group 3,181.67 845.71 4,027.38 2,183.25 580.43 2,763.68
4 AA Yarn Mills Limited 3,034.16 1,718.00 4,752.16 - - -
5 Max Infrastructure Ltd. 2,666.43 747.38 3,413.81 - - -
6 Basundhara Group 2,647.23 2,694.77 5,342.00 2,117.82 807.97 2,925.79
7 Pran RFL Group 2,423.02 3,247.29 5,670.31 1,227.67 1,892.52 3,120.19
8 Toma Group 1,939.27 1,908.13 3,847.40 1,392.43 1,416.86 2,809.29
9 Echotex 1,717.53 2,204.97 3,922.50 659.11 2,345.92 3,005.03
10 City Group 1,256.69 3,553.97 4,810.66 1,000.70 2,928.68 3,929.38
11 Summit Group 451.59 7,277.68 7,729.27 2,537.29 3,414.16 5,951.45
12 ENERGYPAC 997.37 2,635.04 3,632.41 - - -
13 Western Marine Group 1,860.00 1,951.00 3,811.00 1,561.14 2,986.42 4,547.56
14 Abul Khair Steel Industries Ltd - - - 1,157.08 3,511.78 4,668.86
15 Renaissance Group - - - 1,305.78 1,205.11 2,510.89
16 Dird Group - - - 1,732.18 1,005.08 2,737.26
17 Bank Asia Securities Ltd. - - - 2,450.00 300.00 2,750.00
18 Meghna Group - - - 0.48 3,391.79 3,392.27
19 Spectra Engineers Limited - - - 563.45 2,098.69 2,662.14
20 Thermax Group - - - 1,613.60 987.43 2,601.03
Total 28,982.63 29,788.33 58,770.96 27,633.67 29,795.91 57,429.58

Annual Integrated Report 2017

333
 Annex F
Bank Asia Limited
Names of Directors and their interest in different entities
as at 31 December 2016

Names of firms/companies in which interest-

Sl.
Name Status with the Bank ed as proprietor/director/managing agent/
no.
guarantor/employee/partner, etc.
Rangs Limited
Rangs Workshop Limited
Rangs Industries Ltd.
Rangs Properties Limited
Rangs Motors Limited
Rangs Pharmaceuticals Limited
Ranks ITT Limited
Ranks Telecom Limited
Ranks Petroleum Limited
Ranks Interiors Limited
Rancon Motors Limited
Rancon Engineering Limited
Rancon Services Limited
Shield Security Services Limited
Rancon Autos Limited
Rancon Automobiles Limited
1. Mr. A Rouf Chowdhury Chairman
Rancon Motor Bikes Limited
Ranks Steel Limited
Ranks Real Estate Limited
Ranks Motors Workshop Limited
Ranks Agro Bioteq Limited.
Zest Polymer Limited
Metro Foils Limited
Sea Resources Ltd.
Sea Fishers Ltd.
Deep Sea Fishers Ltd.
Sea Resources Agencies Ltd.
Fishers Shipyard Ltd.
Sea Resources Cold Storage Ltd.
Seamans Dockyard & Fish Meal Ltd.
The Daily Star
Bank Asia Limited
M. Ahmed Tea & Lands Co.
Phulbari Tea Estates Ltd.
M. Ahmed Cold Storage Ltd.
M. Ahmed Food & Spices Ltd.
Mr. Mohd. Safwan Choudhury
M.Ahmad Real Estates Ltd.
2. (Representing Phulbari Vice Chairman
FIVDB
Tea Estates Ltd.)
Premier Dyeing & Calendaring Ltd.
Anandaniketan Ltd.
JVS Ltd.
Bank Asia Limited
Sinha Apparels Ltd.
ZMS Fashions Ltd.
Pritha Apparels Ltd.
3. Ms. Hosneara Sinha Director
Sinha Auto Spinning Mills Ltd.
Sattar Jute Mills Ltd.
Bank Asia Limited
Major General Mohammad
Matiur Rahman, ndu,
4. Director Bank Asia Limited
psc (retd.) (Representing
Sinha Fashions Ltd.)

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334
 Names of firms/companies in which interest-
Sl.
Name Status with the Bank ed as proprietor/director/managing agent/
no.
guarantor/employee/partner, etc.
Mr. Mohammed Irfan Syed General Advisory Services Ltd
5. (Representing Amiran Director
Generations Limited) Bank Asia Limited
Sinha Apparels Ltd.
ZMS Fashions Ltd.
6. Ms. Naheed Akhter Sinha Director
BP Wears (Pvt.) Ltd.
Bank Asia Limited
Rangs Limited
Rangs Workshop Limited
Rangs Industries Ltd.
Rangs Properties Limited
Rangs Motors Limited
Rangs Pharmaceuticals Limited
Ranks ITT Limited
Ranks Telecom Limited
Ranks Petroleum Limited
Ranks Interiors Limited
Rancon Motors Limited
Rancon Engineering Limited
Rancon Services Limited
Shield Security Services Limited
Rancon Autos Limited
Ms. Romana Rouf Chowdhury Rancon Automobiles Limited
7. Director
(Representing Maya Limited) Ranks Steels Limited
Ranks Real Estate Limited
Rangs Motors Workshop Limited
Zest Polymers Ltd.
Metro Foils Limited
Sea Resources Limited
Sea Fishers Limited
Deep Sea Fishers Limited
Agro Food Services Ltd.
Romask Limited
SRL Marine Product Ltd.
Mavis Ispat Limited
Maya Limited
Amreen Romana Ltd.
Amiran Romana Ltd.
Bank Asia Limited
8. Mr. M Shahjahan Bhuiyan Independent Director Bank Asia Limited
9. Mr. Md Nazrul Huda Independent Director Bank Asia Limited
10. Mr. Mashiur Rahman Independent Director Bank Asia Limited

Annual Integrated Report 2017

335
 Annex G
Bank Asia Limited
Islamic Banking Operations

as at and for the year ended 31 December 2017

The operation of our Islamic Banking Windows is totally different from the Bank’s conventional operation as the former operate
their business on the basis of Islamic Shariah. Accounting system is vital for ensuring Shariah compliance in such banking opera-
tion. Our Islamic Banking operation is committed to follow the accounting principles that refrain from interest. In a nutshell, we
follow under noted principles for accounting under its Islamic Banking umbrella, run through a separate Islamic Banking software
styled HIKMAH.

1. Deposit Collection and income Sharing Ratio (ISR) based Profit Distribution
For procuring funds from depositors, our Islamic Banking follows Al-Wadiah and Mudaraba principles. In case of Al-Wadiah
Account, no profit is allowed at present. But for Mudaraba depositors, Bank Asia as the first Bank in Bangladesh, follows income
Sharing technique with variable management fees for the Bank. It is different from traditional Weightage System so far practiced
by almost all Islamic Banking operators in the country.

Income sharing module of Bank Asia has been appreciated by different quarters, particularly by the Central Shariah Board for
Islamic Banks of Bangladesh and Islamic Banks Consultative Forum. Our module offers pre-defined Investment income Sharing
Ratio (ISR) for each type of depositor and the Bank. The ISR determines the portion of income for each type of depositor and the
Bank. For example, the ISR of 75 : 25 would mean that 75% of distributable income is to be shared by the concerned depositors
and the rest 25% to be shared by the Bank. The ISR between each type of Mudaraba depositors and the Bank (Mudarib) are duly
disclosed at the time of Account opening and/or beginning of the concerned period. Profit rate is emerged at actual, as derived
from the income fetched from deployment of the concerned fund. As such our rate of profit on deposit under Islamic Banking
is nothing but a post facto expression of the respective agreed sharing ratios. Our profit rate is an output based on the Bank’s
earning on investment.

The ISR declared on Mudaraba deposits for the year 2017

Distributable Investment Income
Types of Mudaraba Deposit Sharing Ratio (ISR) w.e.f. 01.01.2017
Client Bank
1.       Mudaraba Term Deposit Account (MTDA) 1 month 50% 50%
2.       Mudaraba Term Deposit Account (MTDA) 2 months 50% 50%
3.       Mudaraba Term Deposit Account (MTDA) 3 months 75% 25%
4.       Mudaraba Term Deposit Account (MTDA) 6 months 75% 25%
5.       Mudaraba Term Deposit Account (MTDA) 12 months 77% 23%
6.       Mudaraba Term Deposit Account (MTDA) 24 months 78% 22%
7.       Mudaraba Term Deposit Account (MTDA) 36 months 80% 20%
8.       Mudaraba Term Deposit Account (MTDA) 60 months 80% 20%
9.       Mudaraba Special Notice Deposit Account (MSND) 35% 65%
10.     Mudaraba Savings Account (MSA) 45% 55%
11.   Smart Junior Saver (School Banking) Account 70% 30%
12.   Mudaraba Deposit Pension Scheme (MDPS) 3-12 Years 87% 13%
13.   Mudaraba Monthly Profit Paying Deposit (MMPPD)- 1 year 80% 20%
14.   Mudaraba Monthly Profit Paying Deposit (MMPPD)- 2-5 years 85% 15%
15.   Mudaraba Hajj Savings Scheme (MHSA) 90% 10%
16 Cash Waqf 90% 10%

Bank Asia Limited

336
 Annex G

2. Investment Operation and Return Thereon

Investments of our Islamic Banking are broadly categorised in the following two types in respect of charging (rate of) return:

a.   Fixed return based investment

b.   Variable return based investment

Fixed return base investment system is applicable for our Bai-Murabaha Muajjal Investment mode. Under this mode, Bank sells
the goods to a client at a fixed profit /mark-up on deferred payment including post import basis. Hire Purchase Shirkatul Melk
(HPSM) is also a fixed return based investment mode. In this case rate of rent is fixed but amount of rent becomes variable on
the basis of diminishing balance method.

Variable return based income is applied for our Musaharaka mode of investment. In these cases, only ratio of Income Sharing is
stated in the agreement. Bank bags income on the basis of the concerned venture according to the agreed ratio (comparable to
our Mudaraba deposit products). Genuine loss, if any, is borne according to capital ratio of the client & the Bank.

3. Income/ Revenue Recognition Principle

The bank earns income from various sources such as charges, fees, commission and investment. To recognize all sorts of
income, Bank follows Shariah principle strictly. Usually charges, fees & commission etc. are recognized on actual basis.
Recognition of income from investment follows principles as under:

For Bai-Murabaha Muajjal Investment

While creating each deal, in case of Bai-Murabaha Muajjal mode of investment, markup/profit is added to the bank’s purchase
cost with a credit to unearned income A/c. Thereafter time apportionment of profit is recognised out of the unearned income
amount at the end of each month on accrual basis. Allowance (rebate) for early repayment, if any, may however be applied at
Bank’s discretion.

For Hire Purchase Shirkatul Melk (HPSM) Investment

In case of HPSM mode of investment Rent is charged and taken into income account at the end of each month on accrual basis.

If the account has a provision of gestation period, no income is earned during the period. In this case income starts just after the
end of gestation period. However rent is chargeable in spite of gestation, if the delivery of asset is completed in usable condition
such as a machine or a set of machinery or building etc.

All accrual income is subject to prevailing classification and provisioning rules of Bangladesh Bank.

For Musharaka Investment

In recognizing the revenue from Musharaka Investment, we follow the actual (cash/ realization) basis instead of accrual i.e. no
income is recognised until the result of the venture is arrived at.

4. Cost Recognition Principle

Cost in respect of profit paid on deposit is recognized on accrual basis. Monthly accruals in this respect are calculated on
the basis of income Sharing Ratio. Other costs are also recognized on the accrual basis following the matching concept of
Accounting.

To ensure/ supervise Shariah compliance in banking operation, Bank Asia has a knowledgeable Shariah Supervisory Committee
comprising renowned Fuqaha, Islamic bankers and academicians conversant in Islamic Economics & Finance.

Annual Integrated Report 2017

337
 Annex G-1
Bank Asia Limited
Islamic Banking Unit Balance Sheet

as at 31 December 2017 Amount in Taka

31 Dec 2017 31 Dec 2016
PROPERTY AND ASSETS
Cash
Cash in hand (including foreign currencies) 41,737,134 22,044,516
Balance with Bangladesh Bank and its agent bank 657,449,341 668,492,263
(Including foreign currencies) 699,186,475 690,536,779

Balance with other banks and financial institutions

In Bangladesh 2,699,050 301,541,506
Outside Bangladesh - -
2,699,050 301,541,506
Placement with other banks and financial institutions - -
Investments in shares and securities
Government 550,500,000 564,600,000
Others 160,000,000 200,000,000
710,500,000 764,600,000
Investments
General Investment 11,877,396,366 10,077,003,162
Bills purchased and discounted 29,006,599 51,823,671
11,906,402,965 10,128,826,833
Fixed assets including premises, furniture and fixtures 10,117,133 12,486,618
Other assets 1,762,010,293 33,747,176
Non - banking assets - -
Total assets 15,090,915,916 11,931,738,912
LIABILITIES AND CAPITAL
Liabilities
Placement from other banks, financial institutions and agents - -
Deposits and other Accounts
Al-wadeeah current and other deposits accounts, etc. 782,101,217 581,709,804
Bills payable 37,967,331 22,070,893
Mudaraba savings deposits 1,268,549,392 977,806,566
Mudaraba term deposits 11,773,908,852 9,291,824,084
13,862,526,792 10,873,411,347
Other liabilities 1,228,389,124 1,058,327,565
Total liabilities 15,090,915,916 11,931,738,912
OFF- BALANCE SHEET ITEMS
Contingent liabilities
Acceptances and endorsements 109,270,212 208,225,192
Letters of guarantee - -
Irrevocable letters of credit - -
Bills for collection - -
Other contingent liabilities - -
Other commitments - -
Total Off-Balance Sheet items including contingent liabilities 109,270,212 208,225,192

Bank Asia Limited

338
 Annex G-2
Bank Asia Limited
Islamic Banking Unit Profit and Loss Statement

for the year ended 31 December 2017 Amount in Taka

31 Dec 2017 31 Dec 2016
Investment income 1,010,464,818 860,375,633
Profit paid on deposits, borrowings, etc. 580,866,862 531,649,278
Net investment income 429,597,956 328,726,355
Profit on Investment with bank and financial institutions 16,120,284 18,482,265
Commission, exchange and brokerage 63,761,541 51,120,743
Other operating income 8,728,324 7,357,858
Total operating income 518,208,105 405,687,221
Salaries and allowances 66,393,306 59,685,380
Rent, taxes, insurance, electricity, etc. 7,379,649 6,488,615
Legal expenses 29,500 23,450
Postage, stamp, telecommunication, etc. 393,047 673,966
Stationery, printing, advertisement, etc. 1,393,152 2,027,649
Depreciation and repair of Bank's assets 4,735,767 4,556,745
Other expenses 39,044,975 31,316,071
Total operating expenses 119,369,396 104,771,876
Profit before provision 398,838,709 300,915,345
Provision for investments
General provision 29,630,329 59,246,759
Specific provision (1,782,762) (21,600)
27,847,567 59,225,159
Provision for diminution in value of investments 1,092,702 -
Other provision - -
Total provision 28,940,269 59,225,159
Total profit before taxes 369,898,440 241,690,186

Annual Integrated Report 2017

339
 Annex H
Bank Asia Limited
Off-shore Banking Unit Balance Sheet
as at 31 December 2017

31 Dec 2017 31 Dec 2017 31 Dec 2016 31 Dec 2016

Notes
USD Taka USD Taka
PROPERTY AND ASSETS
Cash
In hand (including foreign currencies) - - - -
Balance with Bangladesh Bank and its agent
- - - -
bank (including foreign currencies)

Balance with other banks and financial

3
institutions
In Bangladesh - - - -
Outside Bangladesh 412,320 33,810,259 19,126,220 1,504,277,184
412,320 33,810,259 19,126,220 1,504,277,184
Investments
Government - - - -
Others 6,267,713 513,952,493 3,870,151 304,387,366
6,267,713 513,952,493 3,870,151 304,387,366
Loans and advances 4 - -
Loans, cash credits, overdrafts, etc. 30,588,147 2,508,228,049 17,620,718 1,385,869,457
Bills purchased and discounted 154,233,088 12,647,113,199 80,887,600 6,361,809,747
184,821,235 15,155,341,248 98,508,318 7,747,679,204
Fixed assets including premises, furniture
- - - -
and fixtures
Other assets 5 500,902 41,073,945 2,381,929 187,338,736
Non - banking assets - - - -
Total assets 192,002,170 15,744,177,945 123,886,618 9,743,682,490

LIABILITIES AND CAPITAL

Liabilities
Borrowings from other banks, financial
6 188,086,318 15,423,078,092 120,468,199 9,474,823,844
institutions and agents
Deposits and other accounts 7
Current deposits 3,635,464 298,108,075 3,209,540 252,430,353
Bills payable - - - -
Savings bank deposits - - - -
Fixed deposits 269,782 22,122,157 176,647 13,893,283
Bearer certificate of deposit - - - -
3,905,247 320,230,232 3,386,187 266,323,636
Other liabilities 8 10,605 869,621 32,232 2,535,010
Total liabilities 192,002,170 15,744,177,945 123,886,618 9,743,682,490
OFF- BALANCE SHEET ITEMS
Contingent liabilities
Acceptances and endorsements 9 381,633 31,293,906 834,100 65,601,965
Letters of guarantee - - - -
Irrevocable letters of credit 10 235,824 19,337,568 944,150 74,257,398
Bills for collection 11 75,902 6,223,986 489,378 38,489,591
Other contingent liabilities - - - -
Other Commitments - - - -
Total Off-Balance Sheet items including
693,359 56,855,460 2,267,628 178,348,954
contingent liabilities

Bank Asia Limited

340
 Annex H-1
Bank Asia Limited
Off-shore Banking Unit Profit and Loss Statement

for the year ended 31 December 2017

31 Dec 2017 31 Dec 2017 31 Dec 2016 31 Dec 2016

Notes
USD Taka USD Taka

Interest income 12 7,587,107 610,079,291 7,335,962 573,549,958

Interest paid on deposits and borrowings, etc. 13 5,209,290 418,878,994 5,240,150 409,692,362
Net interest/net profit on investments 2,377,817 191,200,297 2,095,812 163,857,596
Investment Income - - - -
Commission, exchange and brokerage 14 125,948 10,127,463 93,691 7,325,078
Other operating income 15 339,252 27,279,238 241,929 18,914,853
Total operating income (A) 2,843,017 228,606,998 2,431,433 190,097,527

Rent, taxes, insurance, electricity, etc. 3,073 247,135 1,808 141,356

Postage, stamp, telecommunication, etc. 9,640 775,147 6,679 522,209
Stationery, printing, advertisements, etc. 1,380 110,926 542 42,406
Depreciation and repair of Bank's assets - - - -
Other expenses 156,183 12,558,669 124,030 9,697,108
Total operating expenses (B) 170,276 13,691,877 133,060 10,403,079
Profit before provision (C=A-B) 2,672,741 214,915,121 2,298,373 179,694,448
Provision for loans and advances
General provision 921,236 74,076,620 (124,623) (9,743,441)
Specific provision - - - -
921,236 74,076,620 (124,623) (9,743,441)
Provision for off-balance sheet items (14,885) (1,196,935) 6,283 491,260
Provision for diminution in value of invest-
- - - -
ments
Other provision - - - -
Total provision (D) 906,351 72,879,685 (118,340) (9,252,181)
Total profit/(loss) (C-D) 1,766,390 142,035,436 2,416,712 188,946,629

Annual Integrated Report 2017

341
 Off-shore Banking Unit (OBU) Annex H-2

Notes to the Financial Statements

as at and for the year ended 31 December 2017

1 Status of the unit

Off-shore banking Unit (“the Unit”) is a separate business unit of Bank Asia Limited, governed under the Rules and Guidelines of
Bangladesh Bank. The Bank obtained the Off-shore banking unit permission vide letter no.BRPD(P-3)744(94)/2007-1853 dated
21 June 2007. The Bank commenced the operation of its Off-shore Banking Unit from 28 January 2008 and its office is located at
Zone Service Complex, Chittagong Export Processing Zone, Chittagong.

2 Significant accounting policies and basis of preparations

2.1 Basis of preparation
The financial statements are prepared on the basis of a going concern and represent the financial performance and financial
position of the Off-shore Banking Unit (OBU). The financial statements of the OBU are prepared in accordance with the Bank
Companies Act 1991, in particular, Banking Regulation and Policy Department (BRPD) Circular No. 14 dated 25 June 2003, ,Ban-
gladesh Bank BCD Circular No. (P) 744(27), dated 17 December, 1985, other Bangladesh Bank Circulars, Bangladesh Financial
Reporting Standards (BFRSs) and other rules and regulations where necessary.

2.2 Foreign currency

Items included in the financial statements of the Unit are measured using the currency of the primary economic environment in
which the entity operates (“the functional currency”). The financial statements of the Unit are presented in US Dollar (USD) and
Taka where USD is the functional currency and Taka are the Unit’s presentation currency.

2.3 Loans and advances

a) Loans and advances are stated in the balance sheet on gross basis.

b) Interest is calculated on daily product basis, but charged and accounted for quarterly on accrual basis. Interest on classified
loans and advances/investments is kept in interest suspense account as per BRPD circulars no. 16 of 1998, 9 of 2001 and 10 of
2005 and recognised as income on realisation. Interest is not charged on bad and loss loans and advances/investments as per
guidelines of Bangladesh Bank. Records of such interest amounts are kept in separate memorandum accounts.

c) As per BRPD circular no. 16 dated 18 November 2014, BRPD Circular 14 dated 23 September 2012, BRPD Circular no. 19 dated
27 December 2012 and BRPD Circular no. 05 dated 29 May 2013, provision for sub-standard loans, doubtful loans and bad loss
loans has to be provided at 20%, 50% and 100% respectively for loans and advances depending on the duration of overdue.
Provision for unclassified loan was made at the specified rate i.e. 0.25% to 5%

2.4 General
Assets and liabilities have been translated into Taka currency @USD 1 = BDT 82.00 (2016 : BDT 78.65). Income and expenses
are translated at an average rate @ USD 1 = BDT 80.41 (2016 : BDT 78.18). Assets and liabilities and Income and expenses of
Conventional Banking have been translated into Taka currency @ USD 1 = BDT 82.70.

31 Dec 2017 31 Dec 2017 31 Dec 2016 31 Dec 2016

USD Taka USD Taka
3 Balance with other banks and financial institutions
In Bangladesh - - - -
Outside Bangladesh
Commerzbank A.G, Frankfurt 30,083 2,466,829 364 28,626
Habib American Bank, New York 382,232 31,342,999 19,125,851 1,504,248,145
Sonali Bank (UK) Limited, London 5 431 5 413
412,320 33,810,259 19,126,220 1,504,277,184
4 Loans and advances
Loans, cash credit, overdrafts etc. (Note 4.1) 30,588,147 2,508,228,049 17,620,718 1,385,869,457
Bills purchased and discounted (Note 4.2) 154,233,088 12,647,113,199 80,887,600 6,361,809,747
184,821,235 15,155,341,248 98,508,318 7,747,679,204

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Off-shore Banking Unit (OBU)
Notes to the Financial Statements

31 Dec 2017 31 Dec 2017 31 Dec 2016 31 Dec 2016

USD Taka USD Taka

4.1 Loans, cash credit, overdrafts etc.

Term loan industrial 29,727,216 2,437,631,698 17,042,542 1,340,395,933
Term loan others 119,630 9,809,619 183,972 14,469,361
Loan against trust receipts 488,918 40,091,298 195,873 15,405,423
Packing credit - - 97,081 7,635,428
Demand loan 252,383 20,695,434 101,250 7,963,312
30,588,147 2,508,228,049 17,620,718 1,385,869,457
4.2 Bills purchased and discounted
Payable in Bangladesh 154,233,088 12,647,113,199 80,887,600 6,361,809,747
Payable outside Bangladesh - - - -
154,233,088 12,647,113,199 80,887,600 6,361,809,747
5 Other assets
Branch adjustment account 169,698 13,915,217 2,332,643 183,462,408
Prepaid expenses 331,204 27,158,728 49,286 3,876,328
500,902 41,073,945 2,381,929 187,338,736
6 Borrowings from other banks, financial institutions and agents
Borrwoing from other banks (Note 6.1) 135,164,761 11,083,510,402 90,468,199 7,115,323,844
Borrowing from corporate office, Dhaka 7,368,398 604,208,628 - -
Borrowing - ECA 5,553,159 455,359,062 - -
Borrowing from IFC 40,000,000 3,280,000,000 30,000,000 2,359,500,000
188,086,318 15,423,078,092 120,468,199 9,474,823,844
6.1 Borrwoing from other banks
Standard Chartered Bank, Singapore 32,500,000 2,665,000,000 16,097,801 1,266,092,049
Bank Of Tokyo-Mitsubishi 20,000,000 1,640,000,000 - -
National Bank of Ras Al Khaimah 18,700,000 1,533,400,000 18,000,000 1,415,700,000
United Bank Limited, UAE 17,700,000 1,451,400,000 10,578,000 831,959,700
First Gulf Bank 10,000,000 820,000,000 13,524,000 1,063,662,600
ICICI Bank Limited, Hong Kong 10,000,000 820,000,000 - -
Bank Muscat SAOG 7,000,000 574,000,000 - -
Nepal Bangladesh Bank Limited 5,000,000 410,000,000 5,000,000 393,250,000
Commercial Bank of Ceylon 5,000,000 410,000,000 - -
HDFC, Gift City, Mumbai 5,000,000 410,000,000 - -
Noor Islami Bank, Dubai, UAE 3,000,000 246,000,000 - -
KBC Bank, Brussels 1,264,761 103,710,402
ICICI Bank Limited, Dubai - - 6,000,000 471,900,000
CaixaBank - - 20,000,000 1,573,000,000
Commerzbank - - 1,268,398 99,759,495
135,164,761 11,083,510,402 90,468,199 7,115,323,844
7 Deposits and other accounts
Customer deposits and other accounts (Note 7.1) 3,905,247 320,230,232 3,386,187 266,323,636
7.1 Customer deposits and other accounts
Foreign currency (Current) 2,367,484 194,133,656 1,963,728 154,447,242
Other demand deposits(Current) 1,267,981 103,974,419 1,245,812 97,983,111
Fixed depost 269,782 22,122,157 176,647 13,893,283
3,905,247 320,230,232 3,386,187 266,323,636

Annual Integrated Report 2017

343
 Off-shore Banking Unit (OBU)
Notes to the Financial Statements

31 Dec 2017 31 Dec 2017 31 Dec 2016 31 Dec 2016

USD Taka USD Taka
8 Other liabilities
Provision for loans and advances 903,373 74,076,620 (123,884) (9,743,441)
Provision for off balance sheet items (14,597) (1,196,935) 6,246 491,260
Due to Head Office (888,777) (72,879,685) 117,637 9,252,181
Commission payable - - 1,474 115,899
Accrued expense payable - - 30,758 2,419,111
FDR on Export Bill 10,605 869,621
10,605 869,621 32,232 2,535,010

9 Acceptances and endorsements

Letters of credit (Back to Back) 381,633 31,293,906 834,100 65,601,965
Letters of credit (Acceptances) - - - -
381,633 31,293,906 834,100 65,601,965
10 Irrevocable letters of credit
Letters of credit (Back to Back) 89,559 7,343,838 384,652 30,252,880
Letters of credit (cash) 146,265 11,993,730 559,498 44,004,518
235,824 19,337,568 944,150 74,257,398

11 Bills for collection 75,902 6,223,986 489,378 38,489,591

12 Interest income
Demand loan 5,255 422,565 2,541 198,644
Packing credit 1,418 114,027 2,817 220,239
Loan against trust receipt 19,206 1,544,325 18,612 1,455,111
Payment against documents 15 1,245 222 17,332
Term loan -industrial 1,012,772 81,436,983 988,715 77,301,066
Term loan -others 8,181 657,808 435,377 34,039,190
Foreign bill purchased 6,499,757 522,645,464 5,876,137 459,415,953
Lease finance - - 11,542 902,423
Interest on placement with other banks 40,503 3,256,874 - -
7,587,107 610,079,291 7,335,962 573,549,958
13 Interest paid on deposits and borrowings etc.
Interest on deposit 5,980.31 480,877 140,946 11,019,630
Interest on borrowings 5,203,310 418,398,117 5,099,204 398,672,732
5,209,290 418,878,994 5,240,150 409,692,362
14 Commission, exchange and brokerage
Commission on L/C 39,509 3,176,934 64,528 5,045,030
Commission on export 6,649 534,646 6,787 530,630
Commission on PO, DD, TT, TC, etc 10,000 804,090 6,943 542,827
Foreign exchange gain and charges 67,343 5,415,030 15,089 1,179,696
Fees and commission 2,447 196,763 344 26,895
125,948 10,127,463 93,691 7,325,078
15 Other operating income
SWIFT charge recovery 10,818 869,904 15,800 1,235,335
Other 328,433 26,409,334 226,129 17,679,518
339,252 27,279,238 241,929 18,914,853
Bank Asia Limited
344
 Annex I
Bank Asia Limited
Statement of outstanding unreconciled entries
(nostro account)
as at 31 December 2017

Annual Integrated Report 2017

Amount in USD
As per local book As per correspondents' book
Sl.
Period of unreconciliation Debit entries Credit entries Debit entries Credit entries
no.
No. USD No. USD No. USD No. USD
1 Upto 3 months 37 7 261 15 90 14 323 4
2 More than 3 months but less than 6 months - - - - - - - -
3 More than 6 months but less than 9 months - - - - - - - -
4 More than 9 months but less than 12 months - - - - - - - -
5 More than 12 months - - - - - - - -
Total 37 7 261 15 90 14 323 4

345
 Annex J
Bank Asia Limited
Reconciliation between Bangladesh Bank
statement and Bank’s book
as at 31 December 2017
The reconciling items relates to clearing of the following:

a. Bangladesh Bank cheques

b. Foreign currency demand drafts
c. Government bonds, Sanchayapatra, etc

As per Bangla- As per Bank’s Reconciling

desh General ledger Difference
Local currency Bank Statement
BDT BDT BDT
Bangladesh Bank, Dhaka 14,086,690,768.51 14,449,038,172.17 (362,347,403.66)
Bangladesh Bank, Dhaka (Al-wadeeah current account) 657,449,340.79 657,449,340.79 -
Bangladesh Bank, Chittagong 61,890,758.52 61,893,378.52 (2,620.00)
Bangladesh Bank, Sylhet 4,741,757.11 6,866,664.61 (2,124,907.50)
Bangladesh Bank, Khulna 25,576,182.80 25,568,082.80 8,100.00
Bangladesh Bank, Rajshahi 6,017,029.25 6,017,029.25 -
Bangladesh Bank, Bogra 10,167,979.15 10,167,979.15 -
Bangladesh Bank, Barishal 4,501,097.73 4,501,097.73 -
Bangladesh Bank, Rangpur 7,979,564.94 7,979,564.94 -
Total 14,865,014,478.80 15,229,481,309.96 (364,466,831.16)

Bank credited but not debited by Bangladesh Bank 2,512,286,491.11

Bank debited but not credited by Bangladesh Bank (5,924,129,825.41)
Bangladesh Bank credited but not debited by Bank 5,406,301,528.60
Bangladesh Bank debited but not credited by Bank (2,358,925,025.46)
(364,466,831.16)

As per
Reconciling
Bangladesh As per Bank’s general ledger
Foreign currency difference
Bank statement
USD USD BDT USD
USD Clearing account 3,358,679.26 1,295,693.56 101,906,298.49 2,062,985.70
Total 3,358,679.26 1,295,693.56 101,906,298.49 2,062,985.70

Bank credited but not debited by Bangladesh Bank 5,830,209.85

Bank debited but not credited by Bangladesh Bank (1,682,124.36)
Bangladesh Bank credited but not debited by Bank 305,540.00
Bangladesh Bank debited but not credited by Bank (2,390,639.79)
2,062,985.70

Bank Asia Limited

346
 Annex J

As per Bangla-
Reconciling
desh As per Bank’s general ledger
Foreign currency difference
Bank statement
GBP GBP BDT GBP
GBP Clearing account 9,516.24 9,516.24 121,852.22 -
9,516.24 9,516.24 121,852.22 -

Bank credited but not debited by Bangladesh Bank -

Bank debited but not credited by Bangladesh Bank -
Bangladesh Bank credited but not debited by Bank -
Bangladesh Bank debited but not credited by Bank -
-

As per Bangla-
Reconciling
desh As per Bank’s general ledger
Foreign currency difference
Bank statement
EUR EUR BDT EUR
EUR Clearing account 10,521.29 10,219.46 453,120.52 301.83
10,521.29 10,219.46 453,120.52 301.83

Bank credited but not debited by Bangladesh Bank 301.83

Bank debited but not credited by Bangladesh Bank -
Bangladesh Bank credited but not debited by Bank -
Bangladesh Bank debited but not credited by Bank -

301.83

As per Bangla-
Reconciling
desh As per Bank’s general ledger
Foreign currency difference
Bank statement
JPY JPY BDT JPY
JPY Clearing account 45,238.00 45,238.00 31,667.00 -
45,238.00 45,238.00 31,667.00 -
Total (BDT) 15,331,994,248

Annual Integrated Report 2017

347
 Annex K

348
Bank Asia Limited
Segment Reporting
The Bank reports its operations under the following business segments as per Bangladesh Financial Reporting Standards (BFRS) 8 “Operating segment”
Amount in Taka
Bank Asia Limited Bank Asia Limited and its subsidiaries

Inside Bangladesh Inside Outside Bangladesh

Bangladesh Inter Consolidated
Particulars company
Bank Asia BA transaction
Conventional Islamic Off-shore Total Securities Exchange BA Express
Banking Banking Banking unit Ltd Company USA Inc.
(UK) Ltd
Interest income 14,791,030,750 1,010,464,818 610,079,291 16,411,574,859 298,115,773 - - (172,215,771) 16,537,474,861
Interest paid on deposits and 9,841,810,978 580,866,862 418,878,994 10,841,556,834 184,387,803 - - (172,215,771) 10,853,728,866
borrowings, etc
Net interest income 4,949,219,772 429,597,956 191,200,297 5,570,018,025 113,727,970 - - - 5,683,745,995
Investment income 2,519,270,975 16,120,284 - 2,535,391,259 - - - - 2,535,391,259
Commission, exchange 3,045,927,284 63,761,541 10,127,463 3,119,816,288 176,746,029 20,402,724 29,819,242 - 3,346,784,283
and brokerage
Other operating income 706,158,503 8,728,324 27,279,238 742,166,065 61,337,350 566,448 573,688 - 804,643,551
Total operating income (A) 11,220,576,534 518,208,105 228,606,998 11,967,391,637 351,811,349 20,969,172 30,392,930 - 6,686,819,093
-
Salaries and allowances 2,453,399,873 66,393,306 - 2,519,793,179 50,573,865 7,180,290 17,507,091 - 2,595,054,425
Rent, taxes, insurance, electricity, etc 605,614,860 7,379,649 247,135 613,241,644 14,182,186 6,316,921 6,773,489 - 640,514,240
Legal expenses 24,586,019 29,500 - 24,615,519 117,658 626,697 517,424 - 25,877,298
Postage, stamp, telecommunication, etc 88,375,820 393,047 775,147 89,544,014 2,018,965 518,660 371,951 - 92,453,590
Stationery, printing, advertisements, etc 95,901,164 1,393,152 110,926 97,405,242 1,014,073 449,141 1,298,010 - 100,166,466
Managing Director's salary and fees 13,900,000 - - 13,900,000 - - - - 13,900,000
Directors' fees 2,992,000 - - 2,992,000 294,400 - - - 3,286,400
Auditors' fees 952,100 - - 952,100 95,833 619,282 1,439,369 - 3,106,584
Depreciation and repairs of Bank's assets 455,184,676 4,735,767 - 459,920,443 822,184 1,722,413 1,590,784 - 464,055,824
Other expenses 1,423,432,891 21,479,159 12,558,669 1,457,470,719 27,966,687 3,100,323 10,917,158 - 1,499,454,887
Total operating expenses (B) 5,164,339,403 101,803,580 13,691,877 5,279,834,860 97,085,851 20,533,727 40,415,276 - 5,437,869,714
Profit before provision (C=A-B) 6,056,237,131 416,404,525 214,915,121 6,687,556,777 254,725,498 435,445 (10,022,346) - 6,932,695,374
Provision:
Provision for loans and advances/investments 2,406,649,018 105,000,000 - - - 2,511,649,018
Provision for off-balance sheet items 223,379,000 - - - - 223,379,000
Provision for diminution in value of investments - 906,056 - - - 906,056
Profit before tax provision (C=A-B) 4,057,528,759 148,819,442 435,445 (10,022,346) - 4,196,761,300
Provision for taxation 2,010,000,000 74,671,957 - - - 2,084,671,957
Profit after tax provision (C=A-B) 2,047,528,759 74,147,485 435,445 (10,022,346) - 2,112,089,343

Bank Asia Limited

 Bank Asia Limited Annex K-1
Segment Reporting
The Bank reports its operations under the following business segments as per Bangladesh Financial Reporting Standards (BFRS) 8 “Operating segment”

Annual Integrated Report 2017

Amount in Taka
Bank Asia Limited Bank Asia Limited and its subsidiaries
In side
Inside Bangladesh Outside Bangladesh Inter
Bangladesh Consolidated
Particulars company
BA Exchange transaction
Conventional Islamic Bank- Off-shore Bank Asia Se- BA Express
Total Company
Banking ing Banking unit curities Ltd USA Inc.
(UK) Ltd
PROPERTY AND ASSETS
Cash 17,231,088,442 699,186,475 - 17,930,274,917 5,742 2,727,856 200,258 17,933,208,773
Balance with other banks and financial
29,566,502,080 2,699,050 33,810,259 29,603,011,389 336,215,384 54,274,321 99,426,462 (15,047,104) 30,077,880,452
institutions
Money at call and on short notice - - - - - - - -
Investments 26,321,365,926 710,500,000 513,952,493 27,545,818,419 599,531,872 - - - 28,145,350,291
Loans and advances/investments 170,442,394,543 11,906,402,965 15,155,341,248 197,504,138,756 5,074,106,215 - (2,249,821,140) 200,328,423,831
Fixed assets including premises,
5,319,623,365 10,117,133 - 5,329,740,498 4,025,035 4,496,726 5,968,648 - 5,344,230,907
furniture and fixtures
Other assets 9,280,574,535 1,762,010,293 41,073,945 11,083,658,773 286,992,354 5,749,700 91,434,840 (2,350,657,137) 9,117,178,530
Non - banking assets - - - - -
Total assets 258,161,548,890 15,090,915,916 15,744,177,945 288,996,642,751 6,300,876,602 67,248,603 197,030,208 (4,615,525,381) 290,946,272,783

LIABILITIES AND CAPITAL

Liabilities
Borrowings from other banks, financial
14,845,233,962 - 15,423,078,092 30,268,312,053 2,447,067,334 - - (2,249,821,140) 30,465,558,247
institutions and agents
Subordinated Non-Convertible Zero
8,092,588,885 - - 8,092,588,885 - - - - 8,092,588,885
Coupon Bond
Deposits and other accounts 192,858,714,357 13,862,526,792 320,230,232 207,041,471,381 257,521,410 - - (15,047,104) 207,283,945,687
Other liabilities 21,680,416,564 1,228,389,124 869,621 22,539,776,869 1,590,527,614 90,837,514 188,485,773 (239,127,137) 24,170,500,633
Total liabilities 237,476,953,768 15,090,915,916 15,744,177,945 267,942,149,188 4,295,116,358 90,837,514 188,485,773 (2,503,995,381) 270,012,593,452
Total shareholders' equity 21,054,493,564 - - 21,054,493,564 2,005,760,244 (23,588,911) 8,544,435 (2,111,530,000) 20,933,679,332
Total liabilities and shareholders'
258,531,447,330 15,090,915,916 15,744,177,945 288,996,642,751 6,300,876,603 67,248,603 197,030,208 (4,615,525,381) 290,946,272,783
equity

349
 Bank Asia
Securities Limited

Bank Asia Limited

350
 Annex-L

Independent Auditor’s Report

to the Shareholders of Bank Asia Securities Limited

We have audited the accompanying financial statements of Bank Asia Securities Limited (the “Company”) which comprise the
Statement of Financial position as at 31 December 2017 and the Statement of Comprehensive Income, Statement of Changes
in Equity and Statement of Cash Flows for the year then ended, and a summary of significant accounting policies and other
explanatory information.

Management’s Responsibility for the Financial Statements

Management of the company is responsible for the preparation and fair presentation of these financial statements in accordance
with Bangladesh Financial Reporting Standards (BFRS), the Company’s Act 1994 & other applicable laws & regulations, and for
such internal control as management determines is necessary to enable the preparation of financial statements that are free from
material misstatement, whether due to fraud or error.

Auditors’ Responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance
with Bangladesh Standards on Auditing (BSA). Those standards require that we comply with ethical requirements and plan and
perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement,
whether due to fraud or error.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements.
The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the
financial statements, whether due to fraud or error. In making those risk assessments, the auditor consider internal control relevant
to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate
in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit
also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by
management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion
In our opinion, the Financial Statements present fairly, in all material respects, the Financial Position of Bank Asia Securities Limited
as at 31 December 2017 and of its financial performance and its cash flows for the year then ended in accordance with Bangladesh
Financial Reporting Standards (BFRS) the Company’s Act 1994 & other applicable laws & regulations.

Report on Other Legal and Regulatory Requirements

In accordance with the Companies Act 1994 we also report the following:
a) we have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the
purposes of our audit and made due verification thereof;
b) in our opinion, proper books of account as required by law have been kept by Bank Asia Securities Limited so far as it appeared
from our examination of those books; and
c) the company’s statement of Financial Position and the Statement of profit and loss account and other comprehensive income
dealt with by the report are in agreement with the books of account; and returns.

Dated, Dhaka ACNABIN

11 March 2018 Chartered Accountants

Annual Integrated Report 2017

351
 Bank Asia
Securities Limited
Statement of Financial Position
as at 31 December 2017
Amount in Taka
Notes 31 Dec 2017 31 Dec 2016
Non-Current Assets
Property, plant and equipment 4 4,025,035 1,155,819
Demutualization membership of DSE 5 153,119,000 153,119,000
Total non- current assets 157,144,035 154,274,819

Current Assets
Advances, deposits and prepayments 6 6,203,628 5,112,264
Investment in shares at cost 7 446,412,872 193,475,513.6
Margin loans 8 5,074,106,215 5,380,138,055
Accounts receivable 9 41,601,485 89,006,117
Advance income tax 10 239,187,240 153,368,661
Cash and cash equivalents 11 336,221,126 317,389,759
Total current assets 6,143,732,567 6,138,490,369
Total assets 6,300,876,602 6,292,765,188
Equity
Share capital 12 2,000,000,000 2,000,000,000
Retained earnings/(Accumulated losses) 13 5,760,244 (68,387,241)
2,005,760,244 1,931,612,759

Current Liabilities
Customer deposits 14 257,521,411 336,518,761
Loans and borrowings 15 2,447,067,334 2,606,557,920
Accounts payable 16 1,543,954 15,226,451
Liability for expenses 17 21,199,321 15,642,970
Interest suspense account 18 890,799,214 890,799,214
Provision for diminution in value of investments 19 19,768,861 18,862,805
Provision for client margin loan 19.1 408,494,169 303,494,169
Provision for taxation 20 248,722,096 174,050,139
Total current liabilities 4,295,116,358 4,361,152,429
Total equity and liabilities 6,300,876,602 6,292,765,188
These Financial Statements should be read in conjunction with the annexed notes

Chairman Director Chief Executive Officer

Dated, Dhaka ACNABIN

11 March 2018 Chartered Accountants

Bank Asia Limited

352
Bank Asia
Securities Limited
Statement of Comprehensive Income
for the year ended 31 December 2017
Amount in Taka
Notes 31 Dec 2017 31 Dec 2016

Brokerage commission 176,746,029 103,998,719

Interest income 21 298,115,773 226,189,776
Interest expense 22 (184,387,803) (6,989,416)
Net interest income 113,727,970 219,200,360
Other operating income/loss 23 61,337,350 35,212,218
Total operating income 351,811,348 358,411,297
Operating expenses 24 (97,085,851) (75,582,114)
Profit before provision 254,725,498 282,829,183
Provision for diminution in value of investments 19 (906,056) (11,619,793)
Provision for client margin loan 19.1 (105,000,000) (100,000,000)
Profit /(Loss)before tax 148,819,442 171,209,390
Income tax expense 20 (74,671,957) (57,042,600)
Profit/ (Loss) after tax 74,147,485 114,166,790
Other comprehensive income - -
Total comprehensive income/(loss) 74,147,485 114,166,790
Earnings per share 3.71 5.71

These Financial Statements should be read in conjunction with the annexed notes

Chairman Director Chief Executive Officer

Dated, Dhaka ACNABIN

11 March 2018 Chartered Accountants

Annual Integrated Report 2017

353
 Bank Asia
Securities Limited
Statement of Cash Flows
for the year ended 31 December 2017

Amount in Taka
31 Dec 2017 31 Dec 2016
A. Cash flows from operating activities
Cash received from
Interest income 298,115,773 226,189,776
Brokerage commission 176,746,029 103,998,719
Cash payment to
Interest expenses (184,387,803) (6,989,416)
Operating expenses (90,707,317) (69,315,732)
Customers' deposits (78,997,350) 12,522,829
Margin loan to customers 367,369,189 143,345,920
Other assets 46,313,268 (85,021,780)
Accounts Payable (13,682,497) 9,361,902
Income tax paid (85,818,580) (20,700,949)
Net cash flows from operating activities 434,950,712 313,391,270
B. Cash flows from investing activities
Investment in listed securities (252,937,358) (127,044,843)
Acquisition of property, plant and equipment (3,691,400) (591,200)
Net cash flows from/(used in) investing activities (256,628,758) (127,636,043)
C. Cash flows from financing activities
Loans and borrowings (159,490,587) (312,792,912)
Net cash (used in) from financing activities (159,490,587) (312,792,912)
D. Net increase/(decrease) in cash and cash equivalents (A+B+C) 18,831,367 (127,037,685)
E. Opening cash and cash equivalents 317,389,759 444,427,444
F. Closing cash and cash equivalents 336,221,126 317,389,759

These Financial Statements should be read in conjunction with the annexed notes

Chairman Director Chief Executive Officer

Dated, Dhaka ACNABIN

11 March 2018 Chartered Accountants

Bank Asia Limited

354
 Bank Asia
Securities Limited
Statement of Changes in Equity
for the year ended 31 December 2017

Annual Integrated Report 2017

Amount in Taka
Retained earn-
Share Premi-
Particulars Share capital ings/ (Accumu- Total
um
lated Losses)

Year ended 31 Dec 2016

Opening balance 2,000,000,000 - (182,554,031) 1,817,445,969
Net profit for the year - - 114,166,790 114,166,790
Closing balance 2,000,000,000 - (68,387,241) 1,931,612,759

Year ended 31 Dec 2017

Opening balance 2,000,000,000 - (68,387,241) 1,931,612,759
Net profit for the year - - 74,147,485 74,147,485
Closing balance 2,000,000,000 - 5,760,244 2,005,760,244
These Financial Statements should be read in conjunction with the annexed notes

Chairman Director Chief Executive Officer

Dated, Dhaka
11 March 2018 ACNABIN
Chartered Accountants

355
 Bank Asia
Securities Limited
Notes to the Financial Statements
as at and for the year ended 31 December 2017

1. Reporting entity
Bank Asia Securities Limited (“the Company”), a majority owned subsidiary company of Bank Asia Limited was incorporated as
a private limited company in Bangladesh on 04 August 2010 bearing certificate of incorporation no. C-86230/10 dated 04 August
2010 under the Companies Act 1994 having its registered office at Hadi Mansion (7th Floor), 2 Dilkusha Commercial Area, Dhaka
1000.

The Company obtained permission from Bangladesh Securities and Exchange Commission on 16 March 2011 to operate as a
full fledged stock broker and stock dealer bearing registration nos. Reg/3.1/DSE-237/2011/463 and Reg/3.1/DSE-237/2011/464
respectively.
The main objective of the Company is to act as a full fledged stock broker and stock dealer to execute buy and sale orders and to
maintain own portfolio as well as customers portfolio under the discretion of customers. The Company also performs the other
activities relates to capital market as and when regulators permits the company to carry out activities as per their guidelines.

2. Basis of preparation
2.1 Statement of compliance
The financial statements of the Company are prepared on a going concern basis under historical cost conversion in accor-
dance with generally accepted accounting principles following Bangladesh Financial Reporting Standards (BFRS)/Bangla-
desh Accounting Standards (BAS). Wherever appropriate, such principles are explained in succeeding notes.
2.2 Functional and presentational currency
The financial statements are presented in Bangladesh Taka, which is the Company’s functional currency.
2.3 Use of estimates and judgments
The preparation of financial statements in conformity with BFRS requires management to make judgments, estimates and
assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and
expenses. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing
basis. Revisions to accounting estimates are reviewed on an ongoing basis. Revisions to accounting estimates are recognised
in the periods in which the estimate is revised and in any future periods affected.
3. Significant accounting policies
The accounting policies set out below have been applied consistently to all periods presented in these financial statements.
Certain comparative amounts have been reclassified to conform with the current year’s presentation.
3.1 Interest income
Income from margin loan is recognised on accrual basis. Such income is calculated considering daily margin loan balance of
the respective parties.
3.2 income from brokerage commission
Income from brokerage is recognised on daily basis in the Statement of Comprehensive Income after receiving the trading
note of securities transacted from Dhaka Stock Exchange Limited, at which point performance is assured to be completed.

3.3 Statement of cash flows

Statement of Cash Flows has been prepared as per Bangladesh Accounting Standard BAS 7 under direct method.
3.4 Property, plant and equipment
Items of property, plant and equipment, are measured at cost less accumulated depreciation and impairment losses, as per
BAS 16: Property, Plant and Equipment. Cost includes expenditures that are directly attributable to the acquisition of the
asset.

Bank Asia Limited

356
Securities Limited
Notes to the Financial Statements

Subsequent costs
The cost of replacing part of an item of property, plant and equipment is recognised in the carrying amount of the item if it is
probable that the future economic benefits embodied within the part will flow to the Company and its cost can be measured
reliably. The cost of day-to-day servicing items of property, plant and equipment are expensed when incurred.
Depreciation
Depreciation is charged on straight-line method. Charging depreciation against fixed assets commences from the month of
acquisition (for full month) and ceases at the month when the assets are disposed. Asset category-wise depriciation rates are
as follows:

Rate of
Asset category depreciation
(%)
Computer and accessories 20
Furniture and fixtures 20
Office equipment 20
Office renovation 20
Details are given in Annexure-I.
3.5 Intangible assets
Computer software
Computer software acquired by the Company which have finite useful lives are measured at cost less accumulated amortisation.

Subsequent costs
Subsequent expenditure is capitalised only when it increases the future economic benefits embodied in the specific asset to
which it relates. All other expenditure is recognised in profit or loss.
Amortisation of intangible assets
Computer software are amortised @ 20% per annum in a straight-line method.
Amount in Taka
31 Dec 2017 31 Dec 2016

4. Property, plant and equipment

Opening balance 1,155,819 1,071,096
Add: Addition during the period 3,691,400 591,200
Less: Depreciation charge for the period 822,184 506,477
Closing balance 4,025,035 1,155,819
Details are given in Annex I.

5. Demutualization membership of DSE

The majority owned (99.99%) subsidiary company of thr Bank, Bank Asia Securities Limited (BASL) has acquired
the membership of Dhaka Stock Exchange for Tk. 153,119,000. As per the scheme of Demutualization of DSE, the Company being
the initial shareholders of DSE, is entitled to receive 7,215,106 shares of Tk. 10 each, totalling Tk. 72,151,060.
The Scheme is not yet completed and these shares are also currently not traded. Hence the actual fair value is not readily ascer-
tainbale. However, management expects the fair value to be similar or more that the current revalued amount. Once more clarity
about the Scheme and related factors are available, a determination of fair value and related adjustments including impairment
assessment, if any shall be made at that time.

Annual Integrated Report 2017

357
 Securities Limited
Notes to the Financial Statements
31 Dec 2017 31 Dec 2016
6. Advances, deposits and prepayments
Advance for Office Rent 3,965,848 4,142,174
Advance for DSE Nikunjo Office 850,000 850,000
Advance for Branch Office 607,780 120,090
Advance for Software 780,000 -
6,203,628 5,112,264
7. Investment in shares (at cost) Details are given in Annex II. 446,412,872 193,475,514
8. Margin loans to customers
Opening balance 5,380,138,055 5,488,271,756
Add: Interest charged during the period 281,039,739 204,549,913
5,661,177,793 5,692,821,670
Less: Repayment of Margin Loan during the period 587,071,578 312,683,615
Closing balance 5,074,106,215 5,380,138,055
The Company extends margin loan facilities to customers for trading of shares on the secondary capital market in Bangladesh.
Margin loans are extended on a ratio based on the equity invested by individual customers. The ratio during the year based on
directives issued by Bangladesh Securities and Exchange Commission.
9. Accounts receivable
Receivable from Dhaka Stock Exchange Ltd 35,450,823 80,004,542
Receivable from Bank Asia Limited 7,700 7,700
Receivable Dividend (Dealer) 6,142,962 3,513,875
Cheques in transit - 5,480,000
41,601,485 89,006,117
10. Advance income tax
Opening balance 153,368,661 132,667,712
Tax deducted at source from brokerage commission 26,807,013 15,578,176
Tax deducted at source from dividend income 3,297,041 2,917,339
Advance Tax as per Section 64 54,000,000 -
Tax deducted at source from bank interest 1,714,525 2,205,434
85,818,580 20,700,949
Closing balance 239,187,240 153,368,661

11. Cash and cash equivalents

Cash in hand (note 11.1) 5,742 8,377
Bank balances (note 11.2) 336,215,384 317,381,382
336,221,126 317,389,759
11.1 Cash in hand
Head-office 5,742 8,377
11.2 Bank balances
Bank Asia Limited (Consolidated Customer A/C) 13,629,526 13,165,020
Bank Asia Limited 1,210,395 126,065
Bank Asia Limited (IPO) 207,183 22,766,865
ONE Bank Limited (Consolidated Customer A/C) 2,645,788 2,172,998
ONE Bank Limited (Dealer) 623,996 2,508,691
NRB Bank Limited (Consolidated Customer A/C) 7,883 13,554,787
Midland Bank Limited (Consolidated Customer A/C) 317,890,609 263,080,795
Premier Bank Limited - 6,158
NRB Global Bank Limited 4.03 4.03
336,215,384 317,381,382

Bank Asia Limited

358
Securities Limited
Notes to the Financial Statements
31 Dec 2017 31 Dec 2016
12. Share capital
Authorised capital :
20,000,000 ordinary shares of Taka 100 each 2,000,000,000 2,000,000,000

Issued, subscribed and paid up capital:

20,000,000 ordinary shares of Taka 100 each 2,000,000,000 2,000,000,000

The Company’s shareholding position as at 31 December 2017 was as under:

Number
Name of shareholder % of holding Value/Taka
of shares
Bank Asia Limited 19,999,900 99.99778 1,999,990,000
Mr. Anisur Rahman Sinha 100 0.002222 10,000
20,000,000 100 2,000,000,000

13. Retained earnings/(Accumulated losses)

Opening balance (68,387,241) (182,554,031)
Less: Dividend - -
(68,387,241) (182,554,031)
Add: Total comprehensive income/(loss) during the period 74,147,485 114,166,790
Closing balance 5,760,244 (68,387,241)

14. Customer deposits 257,521,411 336,518,761

Customer deposits represent uninvested funds lying with the Company’s account at the reporting date.

15. Loans and borrowings

Bank Asia Limited 2,249,821,140 2,450,004,404
Prime Bank Limited 197,246,194 156,553,517
2,447,067,334 2,606,557,920

16. Accounts payable

Payable for IPO Application Process 15,000 2,670,000
Dhaka Stock Exchange Ltd. 1,528,954 12,556,451
1,543,954 15,226,451
17. Liabilities for expenses
The amount represents provisions against operating expenses during the period. 21,199,321 15,642,970

18. Interest suspense account

Opening balance 890,799,214 890,799,214
Add: Interest suspense during the year - -
Closing Balance 890,799,214 890,799,214

The amount represents interest income from loan accounts of the clients who have negative equity with Bank Asia Securities
Limited during the year. The amount will be recognised as income when client equity become positive balance.

19. Provision for diminution in value of investments

Opening Balance 18,862,805 7,243,012
Add: Provision made during the year 906,056 11,619,793
Closing balance 19,768,861 18,862,805

Full provision has been made for the difference in market value and cost of instruments on portfolio basis.

Annual Integrated Report 2017

359
 Securities Limited
Notes to the Financial Statements

31 Dec 2017 31 Dec 2016

19.1 Provision for Client Margin Loan
Opening Balance 303,494,169 203,494,169
Add: Provision made during the year 105,000,000 100,000,000
Closing Balance 408,494,169 303,494,169

This represents provision made as per BSEC directive to maintain at least 20% shortfall in negative equity against unrealised
loss on margin loan extended to customer.

20. Provision for corporate income tax

Opening balance 174,050,139 117,007,539
Add: Provision made during the period 74,671,957 57,042,600
Closing balance 248,722,096 174,050,139

21. Interest income

Income from bank deposits 17,076,035 21,639,863
Income from margin loan 281,039,739 204,549,913
298,115,773 226,189,776

22. Interest expense

Interest on loan 184,387,803 6,989,416

23. Other operating income

Others operating income (note 23.1) 68,768,400 40,172,498
Less: CDBL charges 7,431,050 4,960,280
61,337,350 35,212,218
23.1Others operating income
BO account opening fees 537,500 192,500
Margin account renewal fees 650,000 822,000
Income from transfer/transmission/corporate action 636,334 461,611
Margin account opening fees 104,000 70,000
BO account maintenance fees 2,272,500 2,492,500
Other income 736,408 459,809
Dividend Income 19,239,328 17,855,034
Capital gain from investment in shares 44,592,330 17,819,045
68,768,400 40,172,498

Bank Asia Limited

360
Securities Limited
Notes to the Financial Statements

31 Dec 2017 31 Dec 2016

24. Operating expenses
Audit fees 95,833 95,833
Bank charges 232,598 141,978
Bank guarantee commission 1,380,000 1,560,000
BO Maintenance 1,900,500 1,994,000
Business and promotional expenses 1,165,642 75,008
Cleaning expenses 525,953 496,424
Computer accessories 213,159 124,240
Conveyance 870,307 209,795
Depreciation 822,184 506,477
Directors' remuneration 294,400 230,000
Entertainment 1,415,779 812,742
Fuel and oil 262,570 250,015
Hawla charges 2,450 23,750
Insurance premium 156,308 125,991
Internet charges 1,326,414 1,148,590
Internship Allownace 120,000 -
Laga charges 13,376,397 7,764,826
License and renewal fees 1,750,069 550,583
Newspaper 177,489 83,591
Office rent 12,610,100 11,403,322
Others 49,375 41,483
Plantation 254,465 249,144
Postage and courier 33,101 33,836
Printing and stationery 1,014,073 479,644
Legal expenses 117,658 148,955
Repair and maintenance 1,980,936 508,923
Salaries and allowances 50,573,865 42,028,331
Telephone & Mobile Bill 659,450 615,288
Training Expenses 53,140 96,085
Transportation 6,600 -
Utilities 3,645,037 3,783,261
97,085,851 75,582,114
25. Others
25.1 Figures in these notes and in the annexed financial statements have been rounded off to the nearest Taka.

25.2 These notes form an integral part of the annexed financial statements and accordingly are to be read in conjunction therewith.

Annual Integrated Report 2017

361
362
Bank Asia Securities Limited Schedule of Fixed Assets Annexure-I
as at 31 December 2017

Amount in Taka

Cost Depreciation
Written down
Particulars Rate
At Addition value at
Adjustment/ Total at (%) At Charge for Adjustment Total at 31 Dec 2017
01 Jan 2017 during the
disposal 31 Dec 2017 01 Jan 2017 the period on disposal 31 Dec 2017
year
Computer and accessories 6,511,782 3,039,350 - 9,551,132 20 5,882,596 542,954 - 6,425,550 3,125,582
Furniture and fixtures 2,925,265 - - 2,925,265 20 2,919,564 1,900 - 2,921,464 3,801
Office equipment 5,716,451 652,050 - 6,368,501 20 5,481,261 155,668 - 5,636,928 731,573
Office renovation 7,628,789 - - 7,628,789 20 7,594,167 34,622 - 7,628,789 -
Computer software 1,880,840 - - 1,880,840 20 1,629,720 87,040 - 1,716,760 164,080
Total 24,663,127 3,691,400 - 28,354,527 23,507,308 822,184 - 24,329,492 4,025,035

Bank Asia Limited

 Annexure-II
Bank Asia Securities Limited Investment in shares
as at 31 December 2017
Amount in Taka
SL Name of the com- Types of Number of shares Cost of Quoted value per share Total market value
Nature of shares Face value Average cost
No pany shares including bonus holdings as at 31 Dec 2017 as at 31 Dec 2017
1 AAMRANET Quoted N 10.00 3,503 136,617 39.00 97.70 342,243

Annual Integrated Report 2017

2 ACMELAB Quoted A 10.00 250,000 27,501,266 110.01 114.00 28,500,000
3 ACTIVEFINE Quoted A 10.00 300,000 10,510,442 35.03 35.20 10,560,000
4 AIBL1STIMF Quoted A 10.00 800,000 6,336,696 7.92 8.00 6,400,000
5 BGIC Quoted A 10.00 100,000 2,111,093 21.11 22.20 2,220,000
6 BSRMSTEEL Quoted A 10.00 500,000 48,815,037 97.63 78.50 39,250,000
7 CVOPRL Quoted B 10.00 5,100 1,518,556 297.76 207.00 1,055,700
8 FEKDIL Quoted A 10.00 862,500 21,142,444 24.51 19.50 16,818,750
9 GRAMEENS2 Quoted A 10.00 745,000 10,797,308 14.49 15.50 11,547,500
10 IBNSINA Quoted A 10.00 49,513 11,774,182 237.80 244.40 12,100,977
11 IDLC Quoted A 10.00 395,000 32,367,249 81.94 85.30 33,693,500
12 IFADAUTOS Quoted A 10.00 238,100 28,038,186 117.76 126.00 30,000,600
13 IFIC1STMF Quoted A 10.00 1,000,000 6,519,994 6.52 6.10 6,100,000
14 KPCL Quoted A 10.00 520,000 39,634,465 76.22 58.50 30,420,000
15 LANKABAFIN Quoted A 10.00 205,000 7,546,870 36.81 47.80 9,799,000
16 LINDEBD Quoted A 10.00 2,800 3,704,063 1,322.88 1,284.70 3,597,160
17 LRGLOBMF1 Quoted A 10.00 800,000 6,290,381 7.86 8.30 6,640,000
18 MJLBD Quoted A 10.00 500,000 59,374,064 118.75 109.10 54,550,000
19 NAHEEACP Quoted N 10.00 6,847 62,246 9.09 73.40 502,570
20 OIMEX Quoted N 10.00 6,481 64,810 10.00 65.20 422,561
21 ONEBANKLTD Quoted A 10.00 250,000 6,098,578 24.39 24.00 6,000,000
22 PADMAOIL Quoted A 10.00 20,000 5,341,341 267.07 239.00 4,780,000
23 RAKCERAMIC Quoted A 10.00 178,000 10,598,160 59.54 59.90 10,662,200
24 SHASHADNIM Quoted A 10.00 36,000 2,192,207 60.89 61.70 2,221,200
25 SQURPHARMA Quoted A 10.00 79,250 22,650,280 285.81 301.80 23,917,650
26 SUMITPOWER Quoted A 10.00 500,000 20,338,007 40.68 35.90 17,950,000
27 TRUSTB1MF Quoted A 10.00 1,220,000 8,100,749 6.64 6.70 8,174,000
28 UPGDCL Quoted A 10.00 150,000 25,594,180 170.63 181.10 27,165,000
29 ACFL Unquoted - 10.00 31,385 1,255,400 40.00 - 1,255,400
30 Energypac Limited Unquoted - 10.00 477,225 19,998,000 41.90 - 19,998,000
446,412,872 426,644,011

363
 BA EXCHANGE
COMPANY (UK)
LIMITED
FINANCIAL
STATEMENTS

December 31, 2017

Bank Asia Limited

364
 DIRECTORS A Rouf Chowdhury
Md. Arfan Ali
Abm Kamrul Huda Azad

REGISTERED NUMBER 07314397

REGISTERED OFFICE 125 Whitechapel Road

London
E1 1DT

TRADING ADDRESS 125 Whitechapel Road

London
E1 1DT

INDEPENDENT AUDITORS AGP

Chartered Accountants & Registered Auditors
Unit 8 Quebec Wharf
14 Thomas Road
London
E 14 7AF

Annual Integrated Report 2017

365
 STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2017

INTRODUCTION
The company is part of a group of inter-linked financial services companies based in Bangladesh, with office in UK which also
provides bureau de change services.

BUSINESS REVIEW
Performance and strategy Turnover for the period has increased on the prior year mainly due to improved performance of the
existing business.Operating costs have increased as a result of same.

The company continues to review all of its activities and service offerings and to actively pursue new opportunities. This ongoing
strategy should enhance the profitability of the Company in the future.

PRINCIPAL RISK AND UNCERTAINITIES

Business continuity risk The continuous availability of the Company’s IT systems, infrastructural services and people are critical to
its success. Significant time and resources have and are being committed to this area to underpin the Company’s ability to
continue to operate should any disruptions take place.

Economic and political risk

The turmoil of the global financial markets has had, and is having, a significant negative impact on economic activity across the
globe. Peoples mobility, on which the Company’s business depends, can be impacted by economic factors, political instability,
the threat of terrorism and global diseases. Such risks are outside of the Company’s control.

Information technology risk

Information technology risk is recognised by the Company as one of the most significant corporate risk given the technological
aspect of the business. The electronic transfer of money is dependent on IT including telecommunications and consequently the
emerging markets telecommunications are a critical factor also.The company has appropriate policies and procedures in place to
address technology challenges that may arise for the year ended 31 December 2017.

Interest and foreign exchange risks

The Company is exposed to fluctuations in interest rates and foreign exchange rates. This foreign exchange risk is managed by the
Company using Parent’s treasury function.

Regulatory and legal risk

Globally business in this industry have seen increased regulation and legislation over the past decade with legislation been driven
by financial governing authorities. The Company ensures it complies with applicable regulations and legislation and reviews these
regularly.

FINANCIAL KEY PERFORMANCE INDICATORS

The results for the Company show a pre-tax profit of £4,228 (2016- £939)for the year and turnover of £204K (2016-£175K)

OTHER KEY PERFORMANCE INDICATORS

Gross profit 88.8% (2016: 90.5%)
Net profit 2.0% (2016: 0.5%)

Net Assets £215,618 (2016: £219,846)

Gross Assets £614,696 (2016: £187,259)

This report was approved by the board on 26 March 2018 and signed on its behalf.
-sd-
A Rouf Chowdhury
Director

Bank Asia Limited

366
DIRECTORS’ REPORT
FOR THE YEAR ENDED 31 DECEMBER 2017

The directors present their report and the financial statements for the year ended 31 December 2017.
DIRECTORS’ RESPONSIBILITIES STATEMENT
The directors are responsible for preparing the Strategic report, The Directors’ report and the financial statements in accordance
with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected
to prepare the financial statements in accordance with applicable law and United Kingdom Accounting Standards ( United Kingdom
Generally Accepted Accounting practice),including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in
the UK and Republic of Ireland’.Under company law the directors must not approve the financial statements unless satisfied that they
give a true and fair view of the state of affairs of the Company and of the profit or loss of the company for that period.
In preparing these financial statements, the directors are required to:
select suitable accounting policies for the Company’s finaltial statements and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed
and explained in the financial statements; and
prepare the financial statement on the going concern basis unless it is inappropriate to presume that the company
will continue in the business.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s trans-
actions and disclose with reasonable accuracy at any time the financial position of the Company and to enable them to ensure that
the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Compa-
ny and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

PRINCIPAL ACTIVITY
The principal activity of the Company is provision of bureau de change services.

RESULTS AND DIVIDENDS

The profit for the year, after taxation, amounted to £4,228 (2016 - £939).
The directors have not declared a dividend for the year.
The directors who served during the year were:

A Rouf Chowdhury
Md. Arfan Ali
Abm Kamrul Huda Azad

FUTURE DEVELOPMENTS
The Company is constantly looking at opportunities to develop and refine its business models and is constantly speaking with third
parties for potentials of expanding the business and network further and parent entity is willing to support this.

DISCLOSURE OF INFORMATION TO AUDITORS

Each of the persons who are directors at the time when this Directors’ report is approved has confirmed that:

so far as that director is aware, there is no relevant audit information of which the company’s auditors
are unaware, and
that director has taken all the steps that ought to have been taken as a director in order to be aware
of any relevant audit information and to establish that the company’s auditors are aware of that information.

POST BALANCE SHEET EVENTS

There have been no significant events affecting the company since the year end.

AUDITORS
The auditors, AGP consulting, will be proposed for reappointment in accordance with section 485 of the Companies Act. 2006

This report was approved by the board on 26 March 2018 and signed on its behalf.

-sd-
A Rouf Chowdhury
Director
Annual Integrated Report 2017
367
 INDEPENDENT AUDITORS’ REPORT TO
THE SHAREHOLDERS OF BA EXCHANGE
COMPANY (UK) LIMITED
OPINION
We have audited the financial statements of BA Exchange Company (UK) Limited for the year ended 31 December 2017. The
relevant financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting
Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of
Ireland’ ( United Kingdom Generally Accepted Accounting Practice)

This report is made solely to the company’s members, as a body , in accordance with Chapter 3 of Part 16 of the Companies Act
2006. Our audit work has been undertaken so that we might state to the Company’s members those matters we are required to
state to them in an Auditors’ report and for no other purpose . To the fullest extent permitted by law, we do not accept or assume
responsibility to anyone other than the Company and the Company’s members as a body, for our audit work, for this report, or for
the opinions we have formed.

In our opinion the financial statements:

give a true and fair view of the state of the Company’s affairs as at 31 December 2017 and of its profit for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice ; and
have been prepared in accordance with the requirements of the Companies Act 2006.

BASIS FOR OPINION

We conducted our audit accordance with International Standards on Auditing (UK) (ISAs (UK) and applicable law. Our
responsibilities under those standards are further described in the Auditors’ responsibilities for the audit of the financial statements
section of our report. We are independent of the Company in accordance with the ethical requirements that are relavent to our
audit of the financial statements in the United Kingdom, including the Financial Reporting Council’s Ethical Standard, and we
have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have
obtained is sufficient and appropriate to provide a basis for our opinion.

CONCLUSIONS RELATING TO GOING CONCERN

We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to you where:
the directors use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or
the directors have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt
about the Company’s ability to continue to adopt the going concern basis of accounting for a period of at least twelve months
from the date when the financial statements are authorised for issue.

OTHER INFORMATION
The directors are responsible for the other information. The other information comprises the information included in the Annual
Report, other than the financial statements and our Auditors’ report thereon. Our opinion on the financial statements does not
cover the information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance
conclusion thereon.

In connection with our audit of the financial statements, our responsibilities is to read the other information and, in doing so, consider
whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or
otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are
required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other
information. If based on the work we have performed, we conclude that there is a material misstatement of this other information, we
are required to report that fact.

We have nothing to report in this regard.

OPINION ON OTHER MATTERS PRESCRIBED BY THE COMPANIES ACT 2006

In our opinion, based on the work undertaken in the course of the audit:
the information given in the Strategic report and the Directors’ report for the financial year for which the financial statements are
prepared is consistent with the financial statements.
the Strategic report and the directors’ report have been prepared in accordance with applicable legal requirements.

MATTERS ON WHICH WE ARE REQUIRED TO REPORT BY EXCEPTION

In the light of the knowledge and understand of the Company and its environment obtained in the course of the audit, we have not
identified material misstatements in the Strategic report and the Directors’ report.

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if,
in our opinion:

Bank Asia Limited

368
 INDEPENDENT AUDITORS’ REPORT TO
THE SHAREHOLDERS OF BA EXCHANGE
COMPANY (UK) LIMITED
adequate accounting records have not been kept, or returns adequate for our audit have not been received from
branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of directors’ remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit

RESPONSIBILITIES OF DIRECTORS
As explained more fully in the Directors’ responsibilities statement, the directors are resposible for the preparation of the financial
statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is
necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error

In preparing the financial statements, the directors are responsible for assessing the Company’s ability to continue as a going
concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the
directors either intend to liquidate the Company or to cease operations, or have no realistic alternative but to do so.

AUDITORS’ RESPONSIBILITIES FOR THE AUDIT OF THE FINANCIAL STATEMENTS

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an Auditors’ report that includes our opinion. Reasonable assurance is a
high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the
aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial
statements.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s
website at: www.frc.org.uk/auditorsresponsibilities. The description forms part of our Auditors’ report.

Forhad Ahmed FCA (Senior statutory auditor )

for and on behalf of
-sd-
AGP Consulting

Chartered Accountants and

Statutory Auditors
Unit 8 Quebec Wharf
14 Thomas Road
London
E14 7AF

26 March 2018

AGP Consulting is the trading name of AGP Accountants Ltd registered in England and Wales
(with a registered number 8975602)

Annual Integrated Report 2017

369
 STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2017

2017 2016
Note
£ £

Turnover 4 203,603 175,180

Cost of sales (22,774) (16,704)
GROSS PROFIT 180,829 158,476
Administrative expenses (176,601) (157,537)
Profit for the Financial Year 4,228 939
There were no recognised gain or losses for 2017 or 2016 other than those included in the statement of comprehensive income.
There was no other comprehensive income for 2017 (2016 :£ NIL)

STATEMENT OF FINANCIAL POSITION

AS AT 31 DECEMBER 2017

Note 2017 2016

£ £
FIXED ASSETS
Tangible assets 10 41,103 53,462
41,103 53,462
CURRENT ASSETS
Debtors: amounts falling due within one year 11 52,556 41,503
Cash at bank and in hand 12 521,037 92,294
573,593 133,797
Creditors: amounts falling due within one year 13 (830,314) (407,105))

NET CURRENT LIABILITIES (256,721) (273,308)

TOTAL ASSET LESS CURRENT LIABILITIES (215,618) (219,846)

NET LIABILITIES (215,618) (219,846)
CAPITAL AND RESERVES
Called up share capital 16 300,000 300,000
Profit and loss account 15 (515,618) (519,846)
(215,618) (219,846)

STATEMENT OF CHANGES IN EQUITY

FOR THE YEAR ENDED 31 DECEMBER 2017

Share capital Profit and Total equity

£ loss account £ £
At 1 January 2016 300,000 (520,785) (220,785)
Profit for the year - 939 939
AT 31 DECEMBER 2016 300,000 (519,846) (219,846)
Profit for the year - 4,228 4,228
AT 31 DECEMBER 2017 300,000 (515,618) (215,618)

This report was approved by the board on 26 March 2018 and signed on its behalf.
-sd-
A Rouf Chowdhury
Director

Bank Asia Limited

370
 NOTES TO THE
FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2017
1.GENERAL INFORMATION
BA Exchange Company (UK) Limited is a limited liability company incorporated in England and Wales. The registered office and trad-
ing premises is 125 Whitechapel Road, London, E1 1DT.The Company’s principal activity is that of providing money remittance and
related services.

2. ACCOUNTING POLICIES
2.1 BASIS OF PREPARATION OF FINANCIAL STATEMENTS
The financial statements have been prepared under the historical cost convention unless otherwise specified within these
accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable
in the United Kingdom and the Republic of Ireland and the Companies Act 2006.

The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates.
It also requires management to exercise judgment in applying the Company’s accounting polices (see note 3).

The following principal accounting policies have been applied:

2.2 GOING CONCERN

The company reported a profit during the year despite being in a very competitive market, however the company is carrying
accumulated losses. The results are in line with expectations.

The directors consider that the Company will be able to rely upon sufficient additional support from the parent undertaking
for at least the next 12 month or by arranging funds through and alternative means possibly by way of a loan from one of the
directors and the Board of the Bank has approved this, to allow the Company to be able to meet all the commitments as they
fall due.
Therefore the directors consider that the going concern basis is appropriate in respect of the financial statements for the year
ended 31 December 2017.

2.3 REVENUE
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue
can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding
discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue
is recognised:

Commission income
Income from remittance services is recognised when a consumer gives instructions to the Company to make
a remittance on their behalf.

2.4 Tangible fixed assets

Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated
impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and
condition necessary for it to be capable of operating in the manner intended by management.

Depriciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the
basis below.

Depreciation is provided on the following basis

S/Term Leasehold Property - 10 % Straight line basis
Fixtures and fittings - 25 % Reducing Balance Basis

The assets’ residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate ,
or if there is an indication of a significant change since the last reporting date.

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised
in the Statement of comprehensive income.

2.5 Operating leases: Lessee

Rentals paid under operating leases are charged to the Statement of comprehensive income on a straight line basis over the
lease term.

Annual Integrated Report 2017

371
 NOTES TO THE
FINANCIAL STATEMENTS

2.6 Debtors
Short term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair
value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method , less
any impairment.

2.7 Cash and cash equivalents

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more
than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of
acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.

2.8 Financial instrument

The company only enters into basic financial instruments transactions that result in the recognition of financial assets and
liabilities like trade and other accounts receivable and payable, loans from banks and other third parties, loans to related
parties and investments in non-puttable ordinary shares.

Financial assets that are measured at any cost and amortised cost are assessed at the end of each reporting period for
objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the
Statement of comprehensive income.

For financial assets measured at amortised cost, the impairment loss is measured as the difference between an asset’s carry-
ing amount and the present value of estimated cash flows discounted at the asset’s original effective interest rate. If a finan-
cial asset has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate
determined under the contract.

For financial assets measured at cost less impairment, the impairment loss is measured as the difference between an asset’s
carrying amount and the best estimate of the recoverable amount, which is an approximation of the amount that the Com-
pany would receive for the asset if it were to be sold at the reporting date.

Financial assets and liabilities are offset and the net amount reported in the Statement of financial position when there is
an enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset
and settle the liability simultaneously.
2.9 Creditors
Short term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured
initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest
method.

2.10 Foreign currency translation

Functional and presentation currency: The company’s functional and presentational currency is GBP.

Transactions and balances: Foreign currency transactions are translated into the functional currency using the spot exchange
rates at the dates of the transactions.

At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at
historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair
value are measured using the exchange rate when fair value was determined.

Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end
exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the Income statement
except when deferred in other comprehensive income as qualifying cash flow hedges.

2.11 Taxation
Tax is recognised in the Income statement, except that a change attributable to an item of income and expense recognised as
other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or
directly in equity respectively.

The current income tax charges is calculated on the basis of tax rates and laws that have been enacted or substantively en-
acted by the reporting date in the countries where the Company operates and generates income.
Bank Asia Limited
372
 NOTES TO THE
FINANCIAL STATEMENTS

3. JUDGEMENTS IN APPLYING ACCOUNTING POLICIES AND KEY SOURCES OF ESTIMATION UNCERTAINTY

Preparation of financial statements requires management to make significant judgments and estimates. Tangible fixed assets are
depreciated over their useful lives taking into account residual values where appropriate. The actual lives of the assets are assessed
annually and may vary depending on a number of factors. In re-assessing useful lives,factors such as technological advances. Resid-
ual value consider such things as projected disposal values.

4. TURNOVER
100% Turnover of the company for the year ended 31 December 2017 (2016- 100%) have arisen from within the United Kingdom.

2017 (£ ) 2016 (£ )
5. OPERATING PROFIT / (LOSS)
The operating profit/ (loss) is stated after charging:
Depreciation of tangible fixed assets 12,359 12,285
Fees payable to the Company's auditor and its associates for the audit of
the company's annual financial statements 3,000 3,000
Other operating lease rentals 42,000 42,000

6. AUDITORS’ REMUNERATION
Fees payable to the Company's auditor and its associates for the audit of the Company’s
annual financial statements 3,000 3,000

All other services 3,000 2,836

7. EMPLOYEES
Staff costs, including directors’ remuneration, were as follows :
Wages and salaries 69,718 60,002

The average monthly number of employees, including the directors, during the year was as follows :
Management 1 1
counter staff 5 3
6 4

8. DIRECTORS’ REMUNERATION
Directors’ emoluments 26,575 22,000

9. TAXATION

FACTORS AFFECTING TAX CHARGE FOR THE YEAR

The tax assessed for the year is lower than (2016- lower than) the standard rate of corporation tax in the UK of 19.25% (2016- 20%).
The difference are explained below :
Profit/ (loss) on ordinary activities before tax 4,228 939

Profit/ (loss) on ordinary activities multiplied by standard rate of corporation tax in the UK 814 188
of 19.25% (2016-20%)
EFFECTS OF :
Unrelieved tax losses carried forward (814) (188)
TOTAL TAX CHARGE FOR THE YEAR - -

Annual Integrated Report 2017

373
 NOTES TO THE
FINANCIAL STATEMENTS
2017 (£ ) 2016 (£ )
FACTORS THAT MAY AFFECT FUTURE TAX CHARGES
The Company has tax losses of £461,400 (2016-£ 477,988) carried forward to relieve future trading profits, no deferred tax asset has
been recognised due to the uncertainity of future taxable profits for offset.

10. TANGIBLE FIXED ASSETS

S/Term Lease- Fixtures and
Total
hold Property fittings
£
£ £
COST OR VALUATION
At 1 January 2017 122,846 19,914 142,760
Additions - - -
At 31 December 2017 122,846 19,914 142,760

DEPRICIATION
At 1 January 2017 69,614 19,684 89,298
Charge fpr thr year owned assets 12,284 75 12,359
At 31 December 2017 81,898 19,759 101,657

NET BOOK VALUE

At 31 December 2017 40,948 155 41,103
At 31 December 2016 53,232 230 53,462

The net book value of land and building may be further analysed as follows :
Short leasehold 40,949 53,232

2017 2016
£ £

11. DEBTORS
Other debtors 51,835 32,852
Prepayments and accrued income 721 8,652
52,556 41,504

12. CASH AND CASH EQUIVALENTS

Cash at bank and in hand 521,037 92,294

13. CREDITORS : Amounts falling due within one year

Trade creditors 764,009 348,892
Other taxation and social security 1,065 584
Other creditors 35,836 47,193
Accruals and deferred income 29,404 10,436
830,314 407,105

14. FINANCIAL INSTRUMENTS

FINANCIAL ASSETS
Financial assets that are debt instruments measured at amortised cost 572,872 125,145
FINANCIAL LIABILITIES

Bank Asia Limited

374
 NOTES TO THE
FINANCIAL STATEMENTS
2017 (£ ) 2016 (£ )
Financial liabilities measured at amortised cost (829,251) (406,521)
(829,251) (406,521)

Financial assets measured at amortised cost comprise cash at bank and in hand, trade debtors and others debtors.
Financial liabilities measured at amortised cost comprise trade creditors, others creditors and accruals for goods and services.

15. RESERVES
Profit and loss account
The profit and loss account consists of profits retained within the business and is recorded at historic cost.

16. SHARE CAPITAL

Alloted, called up and fully paid
300,000 Ordinary shares of £1 each 300,000 300,000

17. COMMITMENTS UNDER OPERATING LEASES

At 31 December 2017 the Company had future minimum lease payments under non-cancellable operating leases as follows :
Not later than 1 year 42,000 42,000
Later than 1 year and not later than 5 years 78,132 157,932
120,132 199,932

The Company’s operating lease expense is disclosed in Note 5 and the annual commitments under these arrangements are
disclosed above. The annual rent is due for review in 2017 with the previous landlord was verbally agreed but this subseqently was
not enforced and there was a change in landlord and thr original lease amounts have been retained.

18. RELATED PARTY TRANSACTIONS

All of the company’s remittances are routed through it’s parent entity Bank Asia Limited as part of the normal business cycles, these
transactions are at arms length, these amountshave no transactional value and purely for settlement. All commission income is
earned from the remitters. There is a position at the year end included in Trade Creditors of £764,009 (2016- £348,892)

19. CONTROLLING PARTY

The Company’s ultimate parent undertaking is Bank Asia Limited, a company incorporated in Bangladesh. The accounts for this
entity may be obtained from Head Office Bank Asia Corporate Office, Rangs Tower (2nd -6th Floor ), 68 Purana Paltan, Dhaka 1000,
Bangladesh or on their website www.bankasia-bd.com.

Annual Integrated Report 2017

375
 DETAILED PROFIT AND
LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2017

2017 (£) 2016 (£)

Turnover 203,603 175,180
Cost of sales (22,774) (16,704)
GROSS PROFIT 180,829 158,476
LESS : OVERHEADS
Administration expenses (176,601) (157,537)
PROFIT/ (LOSS) FOR THE YEAR 4,228 939

Commission Income 181,006 132,302

Other income 5,500 6,000
F/X Gain (Loss) 17,097 36,878
203,603 175,180

COST OF SALES
Bank Charges 22,774 16,704

Bank Asia Limited

376
SCHEDULE TO THE
DETAILED ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2017

2017 (£) 2016 (£)

Administration Expenses
Directors salaries 26,575 22,000
Staff salaries 43,143 38,002
Hotels, travel and subsistence 2,788 233
Printing and stationary 958 1,235
Postage 354 177
Telephone and fax 4,682 3,271
Computer costs 3,355
General office expenses 4,541 3,516
Advertising and promotion 3,403 661
Legal and professional 6,085 3,940
Auditor's remuneration 3,000 3,000
Auditor's remuneration -non-audit 3,013 2,836
Rent- Operating leases 42,000 42,000
Rates 15,807 13,867
Light and heat 2,827 3,015
Insurance 656 548
Repairs and maintenance 4,365 3,596
Depreciation -leasehold property 12,359 12,285
176,601 157,537

Annual Integrated Report 2017

377
 BA
EXPRESS
USA INC.
FINANCIAL
STATEMENTS

December 31, 2017

Bank Asia Limited

378
 DIRECTORS A Rouf Chowdhury, Chairman
Rumee A Hossain
Md. Arfan Ali

REGISTERED OFFICE 168-29 HILLSIDE AVE

Suite 2B, JAMAICA
NEW YORK 11432, USA

TRADING ADDRESS 168-29 HILLSIDE AVE

Suite 2B, JAMAICA
NEW YORK 11432, USA

484, Mc Donald Avenue (1st floor)

Brooklyn
NY 11218, New York, USA

INDEPENDENT AUDITORS UNITED FINANCIAL CPA P.C.

Certified Public Accountants
122 East 42nd Street, Suite #2100
New York, NY 10168
Tel: (212)661-2315 Fax: (212)983-5276

Annual Integrated Report 2017

379
 INDEPENDENT
AUDITOR’S REPORT

To the Board of Directors and

BA Express USA Inc.

We have audited the accompanying balance sheet of BA Express USA Inc. (a New York Corporation)as of December 31, 2017, and
the related statements of income, retained earnings, and cash flows for the year then ended.These financial statements are the
responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on
our audit.

We conducted our audit in accordance with generally accepted auditing standards.Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used a significant estimate made by management, as well as evaluating the
overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly , in all material respects, the financial position of BA Express
USA Inc. as of December 31, 2017. and the results of its operations and its cash flows for the year then ended in conformity with
generally accepted accounting principles.

-sd-
New York, New York
February 22, 2018

United Financial CPA PC

122 East 42nd Street, Suite #2100
New York, NY 10168
Tel: (212)661-2315 Fax: (212)983-5276

Bank Asia Limited

380
BALANCE SHEET
For the Year Ended December 31, 2017
(See accompanying auditor’s report )

Assets 2017 ($)

Current Assets:
Cash in Bank (note D) 1,214,960
Accounts Receivable (note E) 1,060,507
Other Current Assets 19,700
Total Current Assets 2,295,167

Fixed assets, net (note F) 72,788

Organizational Costs, net (note F) 10,652
Security deposits (note I) 24,200
Total Fixed Assets 107,640
Total assets 2,402,807

LIABILITIES AND STOCKHOLDER'S EQUITY

Current Liabilities :
Remittance payable to Bank Asia 2,275,225
Beneficiary 19,181
Accrued Taxes and other liabilities 800
Withholding Taxes 3,401
Total Current Liabilities 2,298,607
Total stockholder's equity 104,200
Total Liabilities & Stockholder's Equity 2,402,807

The accompanying notes are an integral part of these financial statements.

-sd-
United Financial CPA PC
122 East 42nd Street, Suite #2100
New York, NY 10168
Tel: (212)661-2315 Fax: (212)983-5276

Annual Integrated Report 2017

381
 STOCKHOLDER’S EQUITY
For the Year Ended December 31, 2017
(See accompanying auditor’s report )

2017 ($)
Paid in Capital 960,000
Retained Earnings beginning of the year (731,161)
Net Income / (Loss ) for the twelve months ended December 31, 2017. (124,639)
Retained Earnings at the end of Dec. 31, 2017 (855,800)

Total Stockholder's Equity 104,200

The accompanying notes are an integral part of these financial statements.

STATEMENT OF INCOME AND

RETAINED EARNINGS
For the Year Ended December 31, 2017
(See accompanying auditor’s report )

2017 ($)
Revenue
Agent Commission / Fees Income 284,028
FX Commission/ Gain 331,597
Other Income 500
Interest Income 6,634
Total revenue 622,759
Expenses
General and Administrative expenses
New York, office expenses 725,009
Depreciation and Amortization 20,660
Total 745,669
Operating income before taxes (122,910)
Income Taxes
NYS and NYC (1,729)
Net Income (loss) (124,639)
Retained Earnings at the beginning of the period (731,161)
Retained Earnings at the end of the year (855,800)

The accompanying notes are an integral part of these financial statements.

United Financial CPA PC

122 East 42nd Street, Suite #2100
New York, NY 10168
Tel: (212)661-2315 Fax: (212)983-5276

Bank Asia Limited

382
STATEMENT OF
CASH FLOW
For the Year Ended December 31, 2017
(See accompanying auditor’s report )

2017 ($)
Cash flow from operating activities :
Net Income (124,639)
Adjustments to reconcile net income to net cash Provided by (used in) operating activities :
Depreciation 19,783
Amortization 877
Other Current Assets (13,600)
Receivable from Agents (342,949)
Due to parent bank 961,285
Due to beneficiary 19,181
Accrued taxes (34)
Net cash provided by operating activities 519,904

Cash flow from investing activities:

Furniture (882)
Organizational Cost 219
Net Cash provided by investing activities (663)

Cash flow from Financing Activities:

Paid in Capital -

Net increase (decrease) in cash 519,241

Cash at beginning of the period 695,937

Adjustment (218)
Cash at the end of the year 1,214,960

The accompanying notes are an integral part of these financial statements.

United Financial CPA PC

122 East 42nd Street, Suite #2100
New York, NY 10168
Tel: (212)661-2315 Fax: (212)983-5276

Annual Integrated Report 2017

383
 NOTES TO FINANCIAL STATEMENTS
For the Year Ended December 31, 2017

Note A. Nature of the Organization and reports

These financial statements are prepared to the best of the management’s knowledge, belief and actual transactions as of December
31, 2017.

BA Express USA Inc. is 100% owned by Bank Asia Ltd, commercial Bank in Bangladesh.

Company was incorporated on September 20, 2011 under the laws of the State of New York. On June 28, 2013 the company received
license as an international money transmitter from the state of New York Department of Financial Services.

BA Express USA INC “BA Express” maintains its offices in New York. BA Express signed paying agent agreement with Bank Asia Ltd.
Bank Asia distributes all funds to Beneficiaries in Bangladesh.

Related Party Transactions and Shareholders

The company has been operating from 168-29 HILLSIDE AVE, Suite 2B, JAMAICA, NEW YORK, 11432.

The Company’s principal Shareholder is :

Owner Related Correspon-
Party dent
Bank Asia Ltd 100% Yes Yes

Note B. Surety Bond / Collateral

The Company has signed agreement with NYS Department of Financial Services and provided $500,000 as collateral, as pledge to
Superintendent. This $500,000 is held at HAB Bank in NY.

Note C. Summary of significant Accounting Policies

REVENUE RECOGNITION: The majority of the company’s revenues are comprised of the transaction-based fees, which typically
constitute a percentage of dollar volume processed, per transaction processed, or some combination thereof.

Revenue is primarily derived from two sources

1. Transaction fees charged to money transfer consumer.
2. The company generates revenue by acquiring currency at higher rate (wholesale) and sell the currency to the customer at retail
exchange rates (lower).

Fees from typical money transfers are generally based on the principal amount of the transaction and the location where the funds
are to be transferred. This transaction is sent by the Company and is recorded as revenue at the time of sale.

Agent Commissions: There are generally two agent locations involved in a money transfer transaction, the agent initiating the
transaction (receiving agent ) and the correspondent disbursing funds. The receiving agent earns a commission generally based on
a percentage of the fee charged to the customer. Receiving Agent commissions are recorded as Expenses.

USE OF ESTIMATES: The preparation of financial statements in conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results
could differ from those estimates.

FAIR VALUE OF FINANCIAL INSTRUMENTS & CONCENTRATION OF CREDIT RISK

Financial instruments consist of cash and cash equivalents, accounts receivable, accounts payable, due to correspondents,
customers transfer payable and debt. The carrying value of such items approximates their fair value at December 31, 2014.

Concentration of credit risk consist of credit and fraud risks of agents, renewal of material agents contracts, loss of business from
significant agents, changes in laws and political stability in countries in which the Company has material agent relationship and
demand for consumer money transfer transactions. Concentration of credit risk is limited due to the high volume of individuals
comprising the Company’s customer base.

Accounting Method: The financial statements of the company are prepared on the accrual basis of accounting and in accordance
with accounting principles generally accepted in the United States of America ( U.S. GAAP).
Bank Asia Limited
384
NOTE D. CASH BALANCE
For the purpose of the statement of cash flows, the company considers all highly liquid investments with maturities 6 months or less
when purchased to be cash equivalents. Cash includes cash at bank, cash in check amounts, the money market account and Cash
held at Company Branch Locations and Restricted Funds.
2017
Cash at Bank 531,218
Branch Funds 162,814
Restricted CD 520,928
Total 1,214,960

NOTE E. Accounts Receivable

The Company has receivables due from agents for money transfer transactions. These receivables are outstanding from the day of
the transfer of the payment instrument until the agent remits the funds to the Company.
2017
Account Receivable 1,060,507
Total 1,060,507

NOTE F. Property, Furniture and Equipment

Property and Equipment are stated at cost and depreciated using straight line method over their estimated useful lives ranging 5 to
7 years and Amortization for 15 Years basis.
2017
Furniture and Fixture 12,561
Equipment 17,472
Leasehold Improvements 102,098
Total 132,131
Less Accumulated Depreciation (59,343)
Net Book Value 72,788

Company Organizational Costs : 12,917

Amortization (2,265)
Net Book Value 10,652

Note I. Security Deposits

Company made several rent security deposits to Landlord for Store front office Branch location in the NYC Metro area.
2017
Rent Security Deposits 24,200

Board of Directors :

Mr. Abdur Rouf Chowdhury , Chairman

Md. Arfan Ali, Director
Mr. Rumee A Hossain, Director

United Financial CPA PC

122 East 42nd Street, Suite #2100
New York, NY 10168
Tel: (212)661-2315 Fax: (212)983-5276

Annual Integrated Report 2017

385
 Management &
Executives

President and Managing Director Senior Vice President

Mr. Md. Arfan Ali Mr. Khandker Sayeed Nazmul Hasan
Mr. Mohammed Aminul Islam Mintu
Deputy Managing Director Mr. Md. Ekramul Hossain
Mr. Md. Zahirul Alam Mr. Md. Murshid-Al-Amin
Mr. Mohammad Borhanuddin Mr. Md. Azizul Haque Khan
Mr. Md. Sazzad Hossain Mr. A.K.M.Mizanur Rahman
Mr. Humayun Yusuf Kabir
Senior Executive Vice President Mr. Md. Jahangir Alam
Mr. Mohammad Ziaul Hasan Molla
Mr. Sarder Akhter Hamed Vice President
Mr. Shafiuzzaman Mr. Md. Azharul Islam
Mr. Md. Ariful Islam Choudhury Mr. Sumon Das
Mr. S.M. Iqbal Hossain Mr. Ali Tarek Parvez
Mr. Md. Zahid Hossain Mr. Md. Saiful Islam Laskar
Mr. Alamgir Hossain Mr. Md. Ilias Khan
Mr. Md. Shahinur Rahman
Executive Vice President Mr. Zahirul Haque
Mr. Mohammad Abdul Qaium Khan Mr. Golam Gaffar Imtiaz Chowdhury
Mr. Md. Zia Arfin Mr. Mohammed Rashidul Kabir Rajib
Mr. Tanfiz Hossain Chowdhury Mr. Md. Ahsan Ul Alam
Mr. Sheikh Mohammad Anisuzzaman Mr. Mohammad Ibrahim Khalil, FCA
Mr. Md. Arshad Mahmud Khan Mr. Mohammad Burhan Uddin Khondker
Mr. A.K.M. Shaiful Islam Chowdhury Mr. Md. Anisuzzaman Molla
Mr. Md. Shaminoor Rahman Mr. Mohammad Ismail Hossain
Mr. Md. Mostafizur Rahman Mr. Syed Ashraful Alam
Mr. Arequl Arefeen Mr. Saiful Islam
Mr. Tahmidur Rashid Mr. Mehbub Hasan
Mr. Md. Abdul Latif Mr. M.R. Chowdhury Rashed
Mr. A.K.M. Mohsin Uddin
Mr. Mohammad Mainul Islam
Mr. Md. Mazibur Rahman
Mr. Mohd. Hosnezzaman
Mr. Syed Humayun Kabir
Mr. Hasan A. Saimoom
Mr. M.M. Shariful Islam
Ms. Suraiya Afroz

Bank Asia Limited

386
 Branches at
a Glance

Branch Name Address Phone/Fax Number Swift Code

Ph: 880-2-9674501-2
Corporate Branch Noor Tower (1st floor), 110, Bir Uttam C.R. Dutta Road, Dhaka 9677031, 9614061-3 BALBBDDH002
Fax: 880-2-9677032
Ph: 880-2-9571450-1,
Principal Office Tea Board Building, 111-113, Motijheel C/A. 9563652, 9571020-1,
BALBBDDH003
Branch Dhaka - 1000 9571023
Fax: 880-2-9566223
Bay’s Gallaria, Ph: 880-2-9889268-9,
Gulshan Branch 57, Gulshan Avenue (Ground Floor) 8828103,8828387 BALBBDDH004
Dhaka - 1212 Fax: 880-2-8816739
Ph: 880-31-714665,
Agrabad Branch 724876, 714703, BALBBDDH005
69, Agrabad C/A, Chittagong
2517303
Fax: 880-31-714548
Malkhanagar Union Parishad Bhaban, Taltola Bazar, Malkhanagar, Ph: 01711831040
Branch Munshigonj Fax: 06924-63225
Ph: 880-2-8142290,
“Rangs Bhaban” Holding # 117/A, Old Airport Road, Tejgaon,
Scotia Branch Dhaka
9137512-5 BALBBDDH007
Fax: 880-2-8155858
MCB Dilkusha Ph: 880-2-9568871 - 3
4, Dilkusha C/A, Dhaka BALBBDDH008
Branch Fax: 880-2-9563649
MCB Sk. Mujib Ph: 880-31-715125 - 7
1269/b Sk. Mujib Road, Agrabad C/A, Chittagong BALBBDDH009
Road Branch Fax: 880-31-710352
Ph: 880-821-724722,
Sylhet Main
60, Niloy Darga Gate, Chowhatta, Sylhet 712256
Branch Fax: 880-821-722616
Tarail Bazar, Kishoreganj Ph: 09434-75099
Tarail Branch Fax: 09434-75099
Ph: 880-2-9885610,
MCB Banani
A. R. Tower, 24, Kamal Ataturk Road, Banani, Dhaka - 1213 9894699, 9889104 BALBBDDH012
Branch Fax: 880-2-9882181
Ph: 880-31-610036,
Khatunganj 638013-4, 618419,
Asia Center, 273/268 Khatunganj, Chittagong BALBBDDH013
Branch 63841
Fax: 880-31-632905
Ph: 03034-56304
Lohagara Branch Mostafa Centre, Lohagara , Chittagong. Fax: 03034-56305
Ph: 880-2-9563768-9,
North South Road 89, Shaheed Syed Nazrul Islam Shoroni, (16,16/1, Malitola BALBBDDH017
9567671
Branch Lane) North South Road, Dhaka- 1100 Fax: 880-2-9563223
Ph: 880-2-8957427 – 9 BALBBDDH015
Uttara Branch House # 79A, Road #07, Uttara Model Town, Dhaka Fax: 880-2-8957431
Chowdhury Plaza (1st Floor), Zamgara Bazar, Ashulia, Savar, Ph: 880-2-7702447
Ashulia Branch Dhaka Fax: 880-2-7790448

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 Branches at a
Glance

Branch Name Address Phone/Fax Number Swift Code

Bismillah Tower (1st & 2nd floor), 147/148, Mitford Road, Ph: 880-2-7320620 - 1 BALBBDDH014
Mitford Branch Dhaka Fax: 880-2-7314999
Ph: 880-31-2850091-2,
CDA Avenue BALBBDDH018
665, CDA Avenue, East Nasirabad, Panchlaish, Chittagong 2863640
Branch Fax:880-31-612933
Sylhet Uposhohor Sylhet Tower, Subhani Ghat, Bishwa Road, Sylhet Ph: 880-821-2833448-9
Branch Fax: 880-821-2830791

Dhanmondi Meher Plaza, House # 13/A (2 Floor), Ph: 880-2-9668361,

nd

Road # 5, Dhaka-1205 8624872-5, 9675918

Branch Fax: 880-2-9664640
Station Road Mohiuddin Market ( 1st floor), 170, Station Road, Chittagong Ph: 88-031-2850934-5 BALBBDDH022
Branch Fax: 88-031-2850936
Ph: 880-2-8402021,
Bashundhara 8845182
Plot # 25, Block-A, Avenue Road, Bashundhara R/A, Dhaka.
Branch Fax: 880-2-8401322,
8845181
Al-Mashah Complex, 44, Mojid Sarani, KDA Avenue (Shib Ph: 88-041-2830136-7,
Khulna Branch Bari Mor), 2831451, 2831361
Khulna-9100 Fax: 041-2830135
Ph: 880-721-812503-4
Rajshahi Branch Ahmed Plaza, 182, Alu Patti Mor, Rajshahi-6100 Fax: 880-0721-812502
Ph: 03222-75179
Chatkhil Branch Khilpara Road, 3147 Chatkhil Bazar, Chatkhil, Noakhali Fax: 03222-75179, 75224
Ph: 880-31-800340,
Zone Service Complex (Ground Floor), CEPZ, Chittagong BALBBDDH027
EPZ Branch 800406
Fax: 880-31-801391
Ph: 02-9857236,
82, Mohakhali C/A,
9857420, BALBBDDH028
Mohakhali Branch Dhaka-1212 9857429
Fax: 8855431
Nishi Plaza, Plot # 1, Avenue 4, Ph: 9013814, 9013841,
Mirpur Branch Section 6, Block C, Pallabi, Mirpur, 9013844
Dhaka-1216 Fax: 880-2-9012122
Ph: 880-31-2854882-3,
184, J.M Sen Avenue, BALBBDDH030
Anderkilla Branch Anderkilla, Chittagong 2854556
Fax: 880-31-2854881
Ph: 880-2-7766677
Rima Plaza, Rohitpur Boarding,
Rohitpur Branch Keranigonj, Dhaka Fax: 880-2-7766600,
7766444
Ph: 880-51-51642-3
Bogra Branch Jamil Shopping Centre, Baragola, Bogra Fax: 880-5178641
Ph: 0421-67783-4, 67748
Jessore Branch Jess Tower (1st Floor), 39/M.K. Road, Jessore Fax: 0421-67738

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Branches at a
Glance

Branch Name Address Phone/Fax Number Swift Code

Bahadderhat Ph: 031-2553741-3
Mamtaz Tower, 4540 Bahadderhat, Chittagong BALBBDDH018
Branch Fax: 88-031-2553745

Shantinagar Treasure Island, 42/43, Ph: 8333979, 8332836,

Siddeshwari Circular Road, 8312729
Branch Dhaka-1217 Fax: 8333978
Mariom Tower (1st floor), 13 Anarkoli Road, Tongi Bazar, Ph: 9816303-4
Tongi Branch Tongi, Gazipur Fax: 880-9816306
Rupjan Tower, Nilnagar ,Konabari, Ph: 02-9298882-3
Konabari Branch Gazipur Fax: 02-9298885
Bhatiary Bazar, Sitakunda, Ph: 031-2781077-79
Bhatiary Branch Chittagong Fax: 031-2781080
Ph:8824653,8824467,
Progoti Shoroni Venus Complex, Pragati Shoroni ,Badda, Dhaka
8824687
Branch Fax: 8825368
Central Jame Masjid Market (1st floor), Ph: 0732664463-5
Ishwardi Branch Station Road, Ishwardi, Pabna. Fax: 0732664462
Ph: 88-02-7744857,
Savar Branch B-70/1 Bazar Road, Savar, Dhaka 7744889, 7744890
Fax: 7744891
Beani Bazar Tajma shopping Center (1st floor), Beani Bazar, Sylhet Ph: 08223-56103-4
Branch Fax: 08223-56105
Hossain tower (1st & 2nd Floor), 1050, Donia, Dhaka Ctg high Ph: 880-2-7540055,
Donia Branch way, Shampur, Dhaka 7540095
Fax: 880-2-7551188
Moghbazar Tropical M.L. Point (1st Floor), 43, New Circular Road, Ph: 8321578, 8321245
Branch Moghbazar, Dhaka-1217 Fax: 8312056
Kamal Bazar Kabir Tower, Kamal Bazar, Mohora Ph: 031-2572872-3
Branch Kalurghat, Chittagong Fax: 031-2572874
Cox’s Bazar J.N Plaza (1st Floor), Plot # 226 (New), Tekpara Main Road, Ph: 88-0341-52240-42
Branch Cox’s Bazar Fax: 88-0341-52244
Ph: 0631-67206-7
Faridpur Branch Plot #2354, Goalchamot, Chak Bazar, Thana Road, Faridpur Fax: 0631-67204

Narayangonj Jahan plaza (1 Floor),20, Sirajuddoula Road, Falpatty,

st
Ph: 88-02-7648801-5
Narayangonj
Branch Fax: 88-02-7648805

Rangs Tower (1st Floor), Ph: 7113844, 7110488,

Paltan Branch 68, Purana Paltan, Dhaka-1000 7115594, 7119664
Fax: 7111164
Jagannathpur 76, T&T Road, Ward-07, Haji Ashid Ullah Market, Ph: 0872-756013
Branch Jagannathpur Bazar, Sunamganj Fax: 0872-756014
Moulvibazar Shah Mostafa Garden City, M. Saifur Rahman Road (Central Ph: 0861-63601, 63602
Branch Road), Moulavi Bazar Fax: 0861-636000

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 Branches at a
Glance

Branch Name Address Phone/Fax Number Swift Code

167 Kalibari Road, East Bhairab, Bhairab Bazar, Bhairab, Ph: 09424-72328-31
Bhairab Branch Kishoregonj Fax: 09424-72332
Strand Road S. A. Chamber (1st Floor), Strand Road, Ph: 031-2513611-2317
Branch Majhirghat, Chittagong Fax: 031-2513906
Ph: 02-9103565-6
Shyamoli Branch 23/4 Khiljee Road, Block B, Shyamoli, Dhaka Fax: 02-9115239
Ibrahim Sobhar Tower (1st Floor), Patherhat, Noapara, Ph: 031-2573111-2
Patherhat Branch Raozan, Chittagong Fax: 031-2573113
Tejgaon Link Road Ph: 88-02-8870081-4
Shanta Western Tower,186, Tejgaon I/A, Dhaka
Branch Fax: 88-02-8870086
Ph: 9016692-3
Rupnagar Branch Plot #34 (1st Floor), Road#16, Rupnagar, Mirpur, Dhaka Fax: 9008757
Laldighirpar Ph: 0821-719901, 719904
Laldighirpar Main Road, Laldighirpar, Sylhet
Branch Fax: 0821-719907
Ph: 880-2-9446553-4
Madhabdi Branch Shitlabari Bazar Road, Narshigndi Fax: 880-2-9446555
Fakir Complex, 112, Birsreshtho Captain Mohiuddin Ph: 0431-2177510-1
Barisal Branch Jahangir Sarak, Barisal Fax: 0431-62227
Oxygen Moor Ph: 031-2583701-2
422, Oxygen Moor, Kulgaon, Bayezid Bostami, Chittagong
Branch Fax: 031-2583704
Ph: 0821-719901,
Laldighirpar, Laldighirpar Main Road, Laldighirpar, Sylhet
719904,
Sylhet Fax:0821-719907
Elephant Road Ph: 9669351,9669331
64, Elephant Road, Dhaka
Branch Fax: 880-2-9669296
Ph: 8100067, 8100071-2
Lalmatia Branch Plot 4/3, Block-D, Lalmatia Housing Estate ,Dhaka Fax: 880-2-8100070
Dohazaria Branch SadekTower (1st Floor), Dohajari, Chandanaish, Chittagong Ph: 01755591572-74
Ph: 88424-75142
Haziganj Branch Munshi Plaza (1st Floor), Main Road, Haziganj, Chandpur Fax: 08424-75144
Zone Service Complex (Ground Floor) , North Potenga, Ph: 031-2502391-3
KEPZ Branch Chittagong Fax: 031-2502934
Shophy Plaza, Aglabazar, Mob: 01911403703,
Aglabazar Branch Nawabgang, Dhaka 01713920853
Hemayetpur Molla Market (1st Floor), Hemayetpur Bus stand, Tetuljhora
Mob: 01711072110
Branch Union, Savar, Dhaka
Dakkhinkhan KC Plaza (1st Floor), Noapara , Dakkhinkhan bazar, Uttara, Mob: 0119818707
Branch Dhaka Fax: 07426-75173
Mohadevpur Saif Uddin Haider & Sons Complex, Ph: 01426-75194
Branch Mohadevpur, Naogaon

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Branches at a
Glance

Branch Name Address Phone/Fax Number Swift Code

Hemanta Shoping Complex (1 Floor),
st
Nimtala Branch Nimtala , Sirajdikhan, Munshiganj Mob:01712942590

Mob: 01717578720,
Comilla Branch Chowdhury Plaza 2, House-465/401, Race Course, Comilla 01771425266
Sonaimuri Branch United Plaza, Bank Road, Sonaimuri Bazar, Noakhali Mob:01711008820
Feni Branch Holding No.- 34, Ward No.- 10, S.S.K. Road, Feni Mob:01714112681
Satmasjid Road Plot # 78, Bir Uttam M A Rob Sarak, Zigatola, Dhanmondi,
Phone 9634926-7
Branch Dhaka
HOB-01713378991,
Paragram Branch Mamtaj Plaza, Koilail Union Parishad, Nawabgonj, Dhaka 04470009132
Sonargaon HOB-01670761210;
“Circle Windflower” Plot No.-30, Sonargaon Janapath Road,
Janapath Road Section-11, Uttara, Dhaka 04470009678,
Branch MOB-01819185190
“Torab Uddin Complex”, Road No.-01, Butibabu Road, Ward HOB-01712 192519
Dinajpur Branch No.-3, Kotwali, Dinajpur
Lichubagan “Al-Emarat Shopping Complex”, Chandragona Kadamtola
HOB-01818 127403
Branch Union Parishad, Rangunia, Chittagong
“Akbar Trade Centre”, BIDC Road, Ward No.- 26, Gazipur City HOB-01913 494546
Gazipur Branch Corporation, Gazipur Sadar, Gazipur
769182,7769183,7769184
“Kalatiya Shopping Centre”, Kalatiya Union Parishad,
Kalatiya Branch Keranigonj, Dhaka Mob:01777-792164

Chandragonj HOB-01727760638
“Sharif Plaza”, Chandragonj, Lakshmipur
Branch
“Bank Asia Bhaban”, Agrabad C/A, Sabder Ali Road, Ward
Bank Asia Bhaban No.- 28, Chittagong City Corporation, Doublemuring,
HOB-01713106206
Branch Chittagong

“Hira Super Market”, Siraj-ud-Dowla Road, Ward No- 03,

Kushtia Branch Kushtia Sadar, Kushtia HOB-01971 733140

Holy Family Red

Crescent Medical “OPD Building” HFRCMCH, 1 Eskaton Garden, Moghbazar
Road, Ward No.- 19, Dhaka South City Corporation, Ramna, Cell: 01715023337
College Hospital Dhaka
Branch
“Swiss Point”, (opposite of Fatullah Police Station), Fatullah,
Fatullah Branch Narayangonj Cell: 01711663609

“Nurses Hostel Building” 1170, Paribagh, Kazi Nazrul Islam

BSMMU Branch Avenue,Shahbagh, Dhaka Cell: 01819299518

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 Branches at a
Glance
Branch Name Address Phone/Fax Number Swift Code
Plot No- 842, North Adabar, Ring Road, Shyamoli, Adabar, Cell-04470009363,
Ring Road Branch Dhaka. 01711969794
Al-hajj Super Market, 279, Masjid Road, Tangail Sadar, HOB-01712965527
Tangail Branch Tangail MOB-01714038273
“Rangpur Bhaban”, Plot# 4737, Station Road, Kotwali,
Rangpur Branch Rangpur Cell: 01716438242

Muksudpur Cell: 01713462602

Faridmia Complex, Muksudpur, Gopalgonj
Branch Ph: -7648801-4
Nangolkot Branch “Haji Nurul Amin Tower” Nangolkot, Comilla
Rupsha Branch “Ma Plaza” School Road, Rupsha, Faridgonj, Chandpur
Brahmanbaria “Muktijoddha Complex Bhaban” (Ground & 1st floor), Sadar
Cell: 01753711966
Branch Hospital Road, Brahmanbaria.
“VTCB Tower Shopping Complex”, Holding# 3 Main Road,
Mirpur-1 Branch Section-1, Mirpur, Dhaka-1216 Cell: 01715158993

“Kazipara Madrasha Complex” Holding# 559, Begum Rokeya

Kazipara Branch Avenue, Kazipara, Mirpur, Dhaka Cell- 01715912454

Mymensingh “Shabit-Sharif Bhaban”, Holding# 55 & 55/A, Boro Bazar,

HOB- 01713109434
Branch Mymensingh
“Noor Hossain Complex”, Holding# 70, DC Road, Gopalgonj,
Gopalgonj Branch Gopalgonj MOB- 01715663251

Maijdee Court Noakhali Super Market, Ward: 03, Court Road, Maijdee,
MOB- 01727760638
Branch Noakhali

Faridganj Branch Talukder Plaza, 640 (1st floor), Faridgonj, Chandpur Cell- 01712866834

Hatirdia Branch Hatirdia New Market, Hatirdia, Monohordi, Narshingdi Cell- 01715627900

Companygonj Hazi Shansul Hoque Market, Companygonj, Muradnagar,

MOB- 01724931400
Branch Comilla
HOB-01994437200
Shimanto Complex Bhaban-2, Holding # 462, Kuti-Kashba
Kashba Branch Road, Kashba, Brahmanbaria
MOB-01749400026

HOB-01718480639
Appollo Pal Bazar Shopping, Holding #187, 188, 189,
Chandpur Branch Mizanur Rahman Road, Chandpur, Chandpur MOB-01716928912

Nabaroon Centre, Holding # 337-341, Sadar Road, Bhola

Bhola Branch Sadar, Bhola HOB-01715087055

Boro Bazar Ph: 041-731208-9

28 Sir Iqbal Road, Khulna Metropolitan City, Khulna
Branch Fax: 041-723306

1676/G/1 River City Market (1st floor), Shah Amanat Bridge Ph: 031-2866395-6
Chaktai Branch Connecting Road, Chittagong Fax: 031-2866398

“Gulshan Peledium”, Holding No- 01, Road No. 95, Block-

Gulshan-2 Branch CEN(C), Ward No. 19, DNCC, Gulshan, Dhaka Ph: 9617115100

Bank Asia Limited

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Branches at a
Glance
Branch Name Address Phone/Fax Number Swift Code

Gouripur Branch Priyota Plaza; Nayagaon, Gouripur, Daudkandi, Comilla HOB - 01713378987

Cell: 01843036958
Ahmed Ali Plaza, College Road, Tengla Bari, Kaliakair,
Kaliakair Branch Gazipur 01626372729
HOB - 01715327113
Haji Anowar Hossain Complex, Shahid Delwar Hossain
Aganagar Branch Road, Aganagar, Keranigonj, Dhaka HOB - 01712205067

Mahmood Plaza, Pangsa Bazaar, Narayanpur, PO & PS:

Pangsha Branch Pangsa, Rajbari HOB - 01713462602

Nur Empori, House#77, Road#11, Block-M, Banani, Ph: 9885610,9889104,

Banani-11 Branch P.S.-Gulshan, Dhaka-1223 9822326

Panchagar Branch Chowdhury Complex,526, Tetulia highway, Panchagar

SME/Agri Branches
Ashulia SME/Agri Tanvir Super Market (1st Floor) , Ph: 88-02-7744975-6
Branch Ashulia Bazar Bus Stand, Ashulia , Savar, Dhaka Fax: 88-02-7744978
Baligaon SME/Agri Dewan Super Market ,Baligaon Bazar, Ph: 0693251004-5
Branch Tongibari, Munshigonj Fax: 0693251004
Shirajdikhan SME/ Shirajdikhan Bazar, Sikder Market Shirajdikhan, Ph: 06924-63364
Agri Branch Munshiganj Fax: 06924-63225
Ramgonj SME/Agri Anupom Super Market (1st Floor) , Bypass Road, Ramgonj, Ph: 03824-75080,75171
Branch Laxmipur Fax: 03824-75124
SME CENTRES
Jatrabari SME Ph: 88-02-7554861-2
Noor Tower, 76/Ga Bibir Bagicha North Jatrabari, Dhaka
Service Center Fax: 7554863
Ph: 0821-710419,
Rekabi Bazar SME Rekabi Bazar, Sylhet
710409
Service Center Fax: 0821-710406
Jurain SME Ph: 88-02-7453414-5
Anaz Tower 495 East Jurain, Kadamtali, Dhaka
Service Center Fax: 88-02-7453416
Bashabo SME 87, East Bashabo, Dhaka Ph: 88-02-7218462-3
Service Center Fax: 88-02-7218460
ISLAMIC WINDOWS
Ph: 880-2-9571450,
Principal Office
Tea Board Building 111-113, Motijheel C/A. Dhaka - 1000. 9571451 BALBBDDH003
Branch Fax: 880-2-9566223
House # 79A, Road #07, Sector # 4, Uttara Model Town, Ph: 880-2-8957427 – 9 BALBBDDH015
Uttara Branch Dhaka - 1230 Fax: 880-2-8957431
Shantinagar Treasure Island Ph: 8333979, 8312729
Branch 42-43, Siddeshwari Circular Road, Shantinagar, Dhaka-1217 Fax: 880-8333978

Bank Asia Bhaban “Bank Asia Bhaban”, Agrabad C/A, Sabder Ali Road, Ward Mobile: 88-01755650731
No.- 28, Chittagong City Corporation, Doublemuring,
Branch Chittagong
Sylhet Uposhohor Sylhet Tower Ph: 880-821-2833448-9
Branch Subhanighat Bishwa Road, Sylhet Fax: 880-821- 2830791

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 Branches at a
Glance

Branch Name Address Phone/Fax Number Swift Code

Islamic Banking Ph: 880-2- 7110062,
Rangs Tower ,Corporate Office, 68 Purana Paltan,
Division, Dhaka-1000 bankasia@bankasia-bd. BALBBDDH
Corporate Office com

Branch Name Address Phone/Fax Number Swift Code

OFF SHORE BANKING UNIT
Ph: 031-800320
EPZ Branch Zone Service Complex (Ground floor), CEPZ, Chittagong Fax: 031-801391
Subsidiary-1: Bank Asia Securities Limited
Phone: 7124743,
7170896
Dilkusha
Hadi Mansion (7th Floor), 2 Dilkusha C/A, Dhaka-1000 Fax: 88-02-9567884
(Head Office) Email: cmd.bankasia@
gmail.com
Dhanmondi Meher Plaza, House # 13/A, R # 05 Phone: 8624874-5
Branch Dhanmondi, Dhaka
Phone: 9013814,
Mirpur Branch Nishi Plaza, Plot # 01, Avenue-04 Section-06, Block-C, Mirpur 9013841
Khulna Branch 28, Sir Iqbal Road (1st Floor), Khulna Phone: 041-2830136-7
Jurain Branch Anaz Plaza (2nd Floor)495,East Jurain Kadamtali, Dhaka Phone: 7453414
H # 79/A, (4 Floor), R# 07, Sector # 04 Uttara Model Town,
th
Phone: 8958371
Uttara Branch Dhaka-1000
Ph: 9885610,9889104,
“Nur Empori” (1st floor), House # 77, Road# 11, Block-M,
Banani Branch Banani, Dhaka-1213, 9822326
Fax: 9822376
Phone: 7124805,
Extension Office 158-160, Ground Floor Motijheel C/A, Dhaka-1000 7124816
Subsidiary-2: BA Exchange Company (UK) Ltd.
Tel: 0203 005 4845-6
125 Whitechapel Road,
Office in UK London E1 1DT Fax: 0207 426 0097
Mob: 0795 081 4675
Subsidiary-3: BA EXPRESS USA inc
168/29 Hill Side Avenue, Suite 2B, Jamaica,
Office in Jamaica NY-11432 New York, USA CEO: 0019173487207

484, Mc Donald Avenue (1st floor), Brooklyn,

Office in Brooklyn NY-11218, New York, USA CEO: 0019173487207

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Integrated
Reporting Checklist
Summary checklist for Integrated Reporting

SL Areas of Reporting Pg Ref SL Areas of Reporting Pg Ref

1 Elements of an Integrated Reporting Performance
Organizational overview and external environment Five years performance 38-41
Mission and vision 8 1.5 Horizontal and vertical analysis 42-45
Core values 9 President and MD’s review 52-56
Business ethics 11 Review of operations & Directors’ report 66-95
Code of conduct 12 Risks, opportunities and internal controls
Corporate structure 15 1.6 Chief Risk Officer’s Desk 108-109
Bangladesh economy 62-64 Risk management report 111-124
1.1 Banking Industry exploring 65 Strategy and resource allocation
Overview of Bank Asia’s operation 66-95 Mission and vision 8
Sectoral distribution of credit 71 Core values 9
Strategic focus for sustainability 153 Deposit and advances strategies 98
1.7
Corporate profile 154 Import and export strategies 99
Environmental performance 166-168 Strategic focus 101
Sustainable HR development 178-183 Strategic focus for sustainability 153
The Bank and its activities 102-103 Stakeholders’ engagement 162-164
Governance Outlook
1.2 Segment report 57 Outlook 2018 61
Corporate Governance 93,194-243 Outlook of 2018-the opportunities
64
Stakeholder Identification/relationships and challenges
1.8
Notice of the 19th AGM 4 Deposit and advances strategies 98

Capital adequacy 128-129 Future orientation

100
(opportunities & challenges)
Stakeholders’ engagement 162-163
Strategic focus for sustainability 153
Sustainability HR development 178-183
Capitals 104-105 Basis of preparation and presentation
1.3 1.9
Corporate Social Responsibility 185-187 Basis of preparation 268-272
Stakeholders relationship 162-164 Responsibility for an integrated report
Communication to shareholders and stakeholders 162-164 2
Bank Asia’ integrated reporting framework 96-105
Structure, classification and pattern of shareholdings 219-220
Other Qualitative Characteristics
Capital plan and investment 247-248 3 Pg Ref
of an Integrated Report
Balance sheet including human capital 213 Conciseness, Reliability and completeness,
1.4 Business model Consistency and comparability, Connectivity
of information, Materiality, Assurance on the
Corporate organogram 17 Report
CMSME banking & Agri/Rural credit 68-69 Awards and recognition 6-7
Sectoral distribution of credit 71 Code of conduct 12
Our activities and values 102-103
Five years performance 38-41
Primary brands and products 156-160
Horizontal and vertical analysis 42-45
Value added statements 170 3.1-3.6
Business model 175 Bank Asia’ integrated reporting framework 96-97

Corporate social responsibility 184-187 Deposit and advances strategies 98

Customer satisfaction survey 188-189 Import and export strategies 99
Market performance 190-191 Statement on non-performing loan (NPL) 110
CFO reports 246-251
Stakeholders’ engagement 162-164
Material aspects and boundaries 165

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 SAFA Standard
Disclosure Checklist
Items Page No
Corporate Objectives, Values & Structure
Clarity and presentation:
Vision and Mission 8
Overall strategic objectives 56, 101, , 153
Core values and code of conduct/ethical principles 9, 12, 211
Profile of the Company 10, 15, 16, 154
Director’s profiles and their representation on Board of other companies &Organization Chart 18-27, 310
Management Report/ Commentary and analysis including Director’s Report
/ Chairman’s Review/CEO’s Review etc.
A general review of the performance of the company 15, 38-45, 66
Description of the performance of the various activities / products / segments of the company and
its group companies during the period under review. (Weightage to be given for pictorial / graphical 15, 68-93, 250-251
/ tabular presentations used for this purpose)
A brief summary of the Business and other Risks facing the organization and steps taken to
108-109, 279-281
effectively manage such risks
A general review of the future prospects/outlook. 60-64
Information on how the company contributed to its responsibilities towards the staff (including 140-144, 178-179,
health & safety) 215-216
Information on company's contribution to the national exchequer & to the economy 171
Sustainability Reporting
184-187, 169,176, 320,
Social Responsibility Initiatives (CSR)
176, 169
Environment related Initiatives 93, 97, 148, 151, 165, 166
Environmental & Social Obligations 166-169, 174
Integrated Reporting 96-98, 152, 100-105, 175
Appropriateness of Disclosure of Accounting policies and General Disclosure
Disclosure of adequate and property worded accounting policies relevant to assets, liabilities,
267-283, 336-367, 342
income and expenditure in line with best reporting standards.
Any Specific accounting policies 272-283
Impairment of Assets 274-277
Changes in accounting policies/Changes in accounting estimates 272-283
Accounting policy on subsidiaries( if there is no any subsidiary, full marks should be granted) 356-357, 371-372, 384
Segment Information
Comprehensive segment related information bifurcating Segment revenue, segment results
and segment capital employed
Availability of information regarding different segments and units of the entity as well
as non-segmental entities/units
Segment analysis of 15, 66-95, 352-353,
348-349
• Segment Revenue
• Segment Results
• Turnover
• Operating profit
• Carrying amount of Net Segment assets
Financial Statements (including Formats)
Disclosures of all contingencies and commitments 257, 271, 277
Comprehensive related party disclosures 282, 323, 334-335
Disclosures of Remuneration & Facilities provided to Directors & CEO 212, 318

Bank Asia Limited

396
SAFA Standard
Disclosure Checklist
Items Page No
256-257, 261-262,
Statement of Financial Position / Balance Sheet and relevant schedules
284-312
income Statement / Profit and Loss Account and relevant schedules 258, 263, 313-322
Statement of Changes in Equity / Reserves & Surplus Schedule 260, 265
Disclosure of Types of Share Capital 127, 276-277, 308-310
Statement of Cash Flow 259, 264,
Consolidated Financial Statement (CFS) 256-260
Extent of compliance with the core IAS/IFRS or equivalent National Standards 282-283
Disclosures / Contents of Notes to Accounts 267-325
Information about Corporate Governance
Board Of Directors, Chairman And CEO 18-27, 202-209
Vision / Mission And Strategy 8, 98, 99
Audit Committee (Composition, role, meetings, attendance, etc) Internal Control & Risk 199-200, 209-210,
Management 218-219
Ethics And Compliance 11-12, 211
Remuneration and other Committees of Board 212
178-183, 213, 249,
Human Capital
104-105
Communication To Shareholders & Stakeholders 4, 162-164, 216
53-56, 108-109, 201,
Management Review And Responsibility
207-211, 246-251
Disclosure by Board of Directors or Audit Committee on Evaluation of quarterly reports 200
Any other investor friendly information 14, 38-41
Risk Management & Control Environment
Description of the Risk Management Framework 111-113, 279-281
Risk Mitigation Methodology 114-119, 130-144
Disclosure of Risk Reporting 120-124
Stakeholders Information
Distribution of shareholding (Number of shares as well as category wise, e.g Promoter group,
219-220
Fil etc)
Shares held by Directors/ Executives and relatives of Directors/ Executive 220, 309-310
Redressal of investors complaints 192-193
Graphical/ Pictorial Data
Earnings per Share 41
Net Assets 41
Stock Performance 190-191
Shareholders' Funds 40

Annual Integrated Report 2017

397
 SAFA Standard
Disclosure Checklist
Items Page No
Return on Shareholders Fund 40
Horizontal/Vertical Analysis including followings
Operating Performance (Income Statement)
Total Revenue
Operating profit
42-45
Profit Before Tax
Profit after Tax
EPS
Statement of Financial Position (Balance Sheet)
Shareholders Fund
Property Plant & Equipment 42-45, 249
Net Current Assets
Long Term Liabilities/Current Liabilities
Profitability/Dividends/ Performance and Liquidity Ratios
Gross Profit Ratio
Earning before Interest, Depreciation and Tax
Price earning ratio 38-41, 284-285
Current Ratios
Return on Capital Employed
Debt Equity Ratio
Statement of Value Added and Its Distribution
Government as Taxes 170-171
Shareholders as dividend 170
Employees as bonus/ remuneration 170
Retained by the entity 170
Market share information of the Company's product/ services 65, 156-160
Economic value added 171
Presentation of Financial Statements
Quality of the Report/ Layout of Contents
Cover and printing including the theme on the cover page
Appropriateness and effectiveness of photographs and their relevance
Effectiveness of Charts and Graphs
Clarity, simplicity and lucidity in presentation of Financial Statements
Timeliness in issuing Financial Statements and holding AGMs
3 months’ time to produce the Annual Report and hold AGM are considered reasonable
May 14, 2018
for full marks
Delay after the initial period of 3 months - deduction of 2 marks is to be made for each month
Additional Disclosures
Any other good additional Disclosure (GRI, GNV) 6-7, 14, 148-149
Human Resource Accounting 212-213
Specific Areas for Banking Sector
Disclosure of Ratings given by various rating agencies for Instruments issued by /of Bank. For eg.
221
FD, CD, Tier I perpetual Bonds
Details of Advances portfolio Classification wise as per the direction issued by the central bank of
273-296
the respective countries

Bank Asia Limited

398
SAFA Standard
Disclosure Checklist
Items Page No
Disclosure for Non Performing assets 110, 133
Movements in NPA 133
Sector-wise breakup of NPA 133
Movement of Provisions made against NPA 133, 305-306
Details of accounts restructured as per regulatory guidelines 293-294
Maturity Pattern of Key Assets and Liabilities (ALM) 266
Classification and valuation of investments as per regulatory guidelines/Accounting Standards 272-273, 289-291
Business Ratio/ Information
Statutory Liquidity Reserve (Ratio)
Net interest income as a percentage of working funds / Operating cost
Efficiency ratio
Return on Average Asset
Cost / income ratio
Net Asset Value Per Share 38-41, 284-285, 308-309,
Profit per employee 326
Capital to Risk Weighted Asset ratio
Operating profit as a percentage of working funds
Cash Reserve Ratio / Liquid Asset ratio
Dividend Cover ratio
Gross Non-Performing assets to gross advances /Non- Performing Loans (Assets) to Total Loans
(Assets
Details of credit concentration / Sector Wise exposures 71, 293, 333
The break-up of ‘Provisions and contingencies' included in the Profit and Loss Account 258, 263, 320
Disclosure under regulatory guidelines 125-144, 223-243
Details of Non-Statutory investment portfolio 289-291, 326-327
Disclosure in respect of assets given on operating & finance lease 275, 328-329
Disclosures for derivative investments 272-274, 289-291
Bank's Network : List of Centers or Branches 387-394

Annual Integrated Report 2017

399
 Corporate Office (Registered Office)
Rangs Tower (2nd to 6th floor)
68 Purana Paltan, Dhaka-1000
Web : www.bankasia-bd.com, https://www.bankasia.net

PROXY FORM
I/we,.................................................................................................................................................................................................................................................................of
......................................................................................................................................................................................................................................................................................................
a Member of BANK ASIA LIMITED do hereby appoint Mr./Ms..........................................................................................................................................................of
................................................................................,or failing him/her Mr./Ms. ......................................................................................................................................................of
...................................................................... as my/our proxy to vote for me/us and on my/our behalf at the Nineteenth Annual General
Meeting of the Members of the Company to be held on the 14th May, 2018 (Monday) and at any adjournment thereof.

In witness my hand this ............................... day of ............................ 2018.

Signature of the Member :

Witnesses: Name :
1. Revenue Folio No.
Stamp
2. BO ID :

Signature of the Proxy :

Folio No :

BO ID :

Shareholder's Attendance Slip

Corporate Office (Registered Office)

Rangs Tower (2nd to 6th floor)
68 Purana Paltan, Dhaka-1000
Web : www.bankasia-bd.com, https://www.bankasia.net

I hereby record my presence at the Nineteenth Annual General Meeting of Bank Asia Limited held today the 14th May 2018 at
11.00 am at Officers’ Club; 26 Baily Road, Dhaka-1000.
I give my particulars and put my signature below.

Name :

Folio No.

BO ID :

Signature

(Please complete this slip and deposit at the registration counter on the day of the meeting)

Bank Asia Limited