Inauguration of NRB Branch

Janata Bank Merchant Banking Operation

Speech of the Chair, Suhel A Choudhury

The chief guest of today's inaugural event hon'ble Advisor Dr. A K M Moshiur Rahman, special guests Mr. Faruk Ahmed Siddiqui and Mr. Rakibur Rahman, the members of the board, invitees, senior executives of Janata Bank, Assalamu-alaikum and a good morning to you all.

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This is indeed an important event for the recently corporatized Janata Bank which was operated as a nationalized commercial bank for over three and a half decades. Janata is starting its merchant bank unit this morning and I thank the SEC and its just retired chairman Mr. Faruk Ahmed Siddiqui for selecting the state-owned Janata Bank as the first receiver of merchant bank licence. We had opened a separate branch for the NRBs less than three months earlier. This was designed as the designated branch for an important segment of our population, the Bangladeshi Diaspora. And today, we are starting our merchant banking operation. We know that capital market is a relatively cheaper and long-term source of capital. Therefore, a vibrant, sustainable and strong capital market is essential for wealth creation, economic development as well as for generating employment opportunities in the country.

►
In order to expand the scope of securities market, the government has allowed the JB to carry out merchant banking operations. Janata has some unique advantages to carryout merchant banking operations successfully. These are adequate capital base, good number of skilled manpower, infrastructure facilities and the bank's presence in divisional cities and other important places, which will offer scope for quick expansion of merchant banking operations. Janata with its adequate capital base, shall be able to handle large volume of activities of underwriting, issue management and investors' portfolio management. In addition, Janata will be in a position to invest sizeable amount in its own portfolio. All these activities shall go a long way to contribute to the development of capital market which will ultimately play an important role in the development of our economy.

►
Janata's board is working hard to give it a new shape and transform it as the effective largest bank in Bangladesh and a leading commercial bank in South Asia by 2010. As a matter of fact, 2008 was the first full year of JB's corporatization and the hon'ble chief guest will be pleased to hear that good progress has been achieved during this period. The percentage of NPLs, a major problem for the state-owned financial institutions, which was above 17 percent in 2007, is less than 11 percent now. It is our target to bring it down to less than 8 percent in this year and 5 percent in 2010. There has been good progress in other areas of operations as well. We have plans to issue IPO shares, hopefully within 2009.

►
During this period, the quality of bank's services has improved, the corporate culture has changed quite a bit and the Janata officials are providing better services to our clients now. A number of our former good clients have returned to Janata, a good number of clients have expressed their satisfaction for providing excellent services. As the chairman of the board, I would like to thank our officials for that although we have to achieve much more to remain competitive. Moreover we are facing a new challenge due to the GFC and we have to be very careful in every respect.

►
We started the year 2009 in a completely different set up as we have a democratically elected government at the helm of affairs. This business friendly government is committed to reforms to bring about changes where necessary and the board of directors of Janata is also committed to ensuring meaningful changes to make it the effective largest bank in Bangladesh. Janata is 50 years old in 2009. We should be celebrating 50th anniversary this year.

►
2008 was a busy year for the board and the management. A number of initiatives were taken throughout the year. By the end of August, 2008, the board had approved, among other things, an updated organogram for the bank, a new officer-based set up, a new service rules for the employees and gave approval to several other policy issues. A new housing loan scheme for the employees has been implemented which will ensure better welfare as well as save valuable land of this land hungry country. We have strengthened the audit division and a number of corrupt practices, pilferages and wasteful expenditures have been detected. We have taken corrective measures. In the area of ICT, a number of measures have been initiated and we hope to see the results within this year.

►
Janata has made good progress in 2008 and the Bank's profit has gone up. Bank officials have got one bonus last year after a gap of almost two decades. This year, I am sure, it would be no less than two bonuses -- may be more. The operating profit for 2008 would be approximately tk.707 crores. I have said earlier that it would not be very difficult for us to make operating profit of over 1,000 crores in the immediate future if we all work hard. Everyone must work sincerely so that this state-owned bank can make meaningful contribution to the economic development of the country. We must also devise a mid-term strategy to earn at least 1500 crores taka as operating profit by the year 2012. At the same time the quality of our loans and advances has to improve further and all types of corrupt practices and wasteful expenditures ought to be eliminated. This will also ensure higher profits for the bank and better pay scales for the bank officials within 2009. We wish to keep our only shareholder, the government, happy by giving cash dividend and bonus shares within the next few months -- perhaps for the first time by a former NCB.

►
The board has approved allocation for CSR activities in the budget for the first time. There are a lot of challenges that we would face in this year. The management has been advised to devise an effective strategy so that five of our top loss making branches could return to profit. Moreover, the management ought to come up with a workable plan as to how we can improve productivity, do away with the past bad practices and utilize the services of all the employees. Further, the training programme must be made more effective, the right person should be posted to the right desk. We have to do a lot more to achieve our goals.

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I thank you all for your patient hearing. Allah Hafez.

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The chief guest of today's inaugural event hon'ble Advisor Dr. A K M Moshiur Rahman, special guests Mr. Faruk Ahmed Siddiqui and Mr. Rakibur Rahman, the members of the board, invitees, senior executives of Janata Bank, Assalamu-alaikum and a good morning to you all.
►	This is indeed an important event for the recently corporatized Janata Bank which was operated as a nationalized commercial bank for over three and a half decades. Janata is starting its merchant bank unit this morning and I thank the SEC and its just retired chairman Mr. Faruk Ahmed Siddiqui for selecting the state-owned Janata Bank as the first receiver of merchant bank licence. We had opened a separate branch for the NRBs less than three months earlier. This was designed as the designated branch for an important segment of our population, the Bangladeshi Diaspora. And today, we are starting our merchant banking operation. We know that capital market is a relatively cheaper and long-term source of capital. Therefore, a vibrant, sustainable and strong capital market is essential for wealth creation, economic development as well as for generating employment opportunities in the country.
►	In order to expand the scope of securities market, the government has allowed the JB to carry out merchant banking operations. Janata has some unique advantages to carryout merchant banking operations successfully. These are adequate capital base, good number of skilled manpower, infrastructure facilities and the bank's presence in divisional cities and other important places, which will offer scope for quick expansion of merchant banking operations. Janata with its adequate capital base, shall be able to handle large volume of activities of underwriting, issue management and investors' portfolio management. In addition, Janata will be in a position to invest sizeable amount in its own portfolio. All these activities shall go a long way to contribute to the development of capital market which will ultimately play an important role in the development of our economy.
►	Janata's board is working hard to give it a new shape and transform it as the effective largest bank in Bangladesh and a leading commercial bank in South Asia by 2010. As a matter of fact, 2008 was the first full year of JB's corporatization and the hon'ble chief guest will be pleased to hear that good progress has been achieved during this period. The percentage of NPLs, a major problem for the state-owned financial institutions, which was above 17 percent in 2007, is less than 11 percent now. It is our target to bring it down to less than 8 percent in this year and 5 percent in 2010. There has been good progress in other areas of operations as well. We have plans to issue IPO shares, hopefully within 2009.
►	During this period, the quality of bank's services has improved, the corporate culture has changed quite a bit and the Janata officials are providing better services to our clients now. A number of our former good clients have returned to Janata, a good number of clients have expressed their satisfaction for providing excellent services. As the chairman of the board, I would like to thank our officials for that although we have to achieve much more to remain competitive. Moreover we are facing a new challenge due to the GFC and we have to be very careful in every respect.
►	We started the year 2009 in a completely different set up as we have a democratically elected government at the helm of affairs. This business friendly government is committed to reforms to bring about changes where necessary and the board of directors of Janata is also committed to ensuring meaningful changes to make it the effective largest bank in Bangladesh. Janata is 50 years old in 2009. We should be celebrating 50th anniversary this year.
►	2008 was a busy year for the board and the management. A number of initiatives were taken throughout the year. By the end of August, 2008, the board had approved, among other things, an updated organogram for the bank, a new officer-based set up, a new service rules for the employees and gave approval to several other policy issues. A new housing loan scheme for the employees has been implemented which will ensure better welfare as well as save valuable land of this land hungry country. We have strengthened the audit division and a number of corrupt practices, pilferages and wasteful expenditures have been detected. We have taken corrective measures. In the area of ICT, a number of measures have been initiated and we hope to see the results within this year.
►	Janata has made good progress in 2008 and the Bank's profit has gone up. Bank officials have got one bonus last year after a gap of almost two decades. This year, I am sure, it would be no less than two bonuses -- may be more. The operating profit for 2008 would be approximately tk.707 crores. I have said earlier that it would not be very difficult for us to make operating profit of over 1,000 crores in the immediate future if we all work hard. Everyone must work sincerely so that this state-owned bank can make meaningful contribution to the economic development of the country. We must also devise a mid-term strategy to earn at least 1500 crores taka as operating profit by the year 2012. At the same time the quality of our loans and advances has to improve further and all types of corrupt practices and wasteful expenditures ought to be eliminated. This will also ensure higher profits for the bank and better pay scales for the bank officials within 2009. We wish to keep our only shareholder, the government, happy by giving cash dividend and bonus shares within the next few months -- perhaps for the first time by a former NCB.
►	The board has approved allocation for CSR activities in the budget for the first time. There are a lot of challenges that we would face in this year. The management has been advised to devise an effective strategy so that five of our top loss making branches could return to profit. Moreover, the management ought to come up with a workable plan as to how we can improve productivity, do away with the past bad practices and utilize the services of all the employees. Further, the training programme must be made more effective, the right person should be posted to the right desk. We have to do a lot more to achieve our goals.
►	I thank you all for your patient hearing. Allah Hafez.