Message from S. A. Farooqui,
Managing Director's
In the year 2009, Standard Bank Limited has registered record growth and best results since it was established in 1999. Our business continued to grow in all areas of banking operation and we have achieved significant progress which confirms that we are moving in right direction. The global economic meltdown that originated in United States has by and large impacted most of the advanced economies of the world but Bangladesh economy has done fairly well despite many challenges. Ever since the new democratic Government took over, efforts were directed to contain inflation, control food prices and augment power supply to rejuvenate the economy with much needed inputs. The present outlook is more positive and the people are much upbeat about the over all GDP growth for the current financial year. We believe the major challenge for the Government lies in bringing momentum for adequate credit flow for all productive sectors and particularly in public private partnership projects for realizing the expected increase in economic activities in near future.
We have mainly focused on credit quality and diversification of existing financial products and services.In order to cater to the emerging need of Islamic Banking for those who are interested in Sharia based system, we have already opened separate desks to offer such services outside interest based transactions. We have a plan to offer full fledged Islamic Banking through separate window from all the branches side by side with conventional banking.
The Bank posted a net profit of TK 764 million compared to TK 657 million in the year 2008 registering a growth of 16%. The Bank's total assets have grown from Tk 34210 million to Tk 49001 million, which accounts for 43% increase in a year's time. This shows that our market share has increased and proves our ability to compete in the market which is indeed a challenge for us. We have also registered significant growth in deposits and advances which grew by 45% and 40% respectively during the year 2009. We may mention here that last year demand for credit was by far sluggish and dampened but competition was fierce among the financial institutions. We have cautiously progressed and carefully calibrated both assets and liabilities so as to move in equilibrium. We have tried to manage our various risk profiles and strict monitoring has enabled us to reduce the level of bad and doubtful loans resulting in reduction of provision. Strong recovery drive throughout the year has contributed significantly in reducing classified loans to 1.83%.
We have made adequate provision against all kinds of loans and advances as per guidelines of Bangladesh Bank. The Bank is now adequately capitalized and the ratio stands at 13.47% against the risk weighted assets.
Throughout the year, we have tried to improve our import and export business and we have achieved remarkable success in both the areas. Our growth rate was 13.23% and 16.37% respectively compared to the year 2008. In line with Bangladesh Bank's initiatives to mobilize inward foreign remittance, we have been very successful in bringing huge quantum of remittance from our migrant workers abroad. We have been licensed to open an Exchange House in UK, which is 100% owned by us to collect and remit fund to Bangladesh. We are already in advance stage of opening another exchange house in New York and survey is being done for places in Canada, Spain etc. Hopefully our own exports and remittance will not only offset our import payments overseas but will also generate surplus foreign exchange in our favour.
Though corporate financing and trade related investments are our major segments of business, but we have slowly and steadily focusing on retail business and small and medium enterprises (SME). Retail and SME has been viewed by Bangladesh Bank to be a major driver of our economic growth. Consequently the Bank has taken initiatives to deepen its stake in these areas. For giving thrust in retail business, we have taken associate membership from Visa International for launching of Visa credit card to be used locally and and internationally. We have secured merchant banking license and successfully managed to have a sizable market share despite very tight situation in the stock market.
Bangladesh Bank has recently declared Agriculture as thrust sector and laid emphasis for funding in crop finance and any other agribased projects. In order to bring them under bank's finance and to augment food production, we have undertaken initiative to offer agriloan to genuine farmers. This will be carried out through our rural branches. Moreover we want to extend bank's loan to marginal farmers so that over a period they can cross the poverty line.
Our core strategy is customer satisfaction and to serve the customers at a competitive price.The bank has made substantial investment for a robust integrated core banking software and we expect that customer service will be far superior to that of our competitors and it will help reduce cost .Soon our customers will be able to use ATMs round the clock and will have access to other networks operating in Bangladesh.
I believe that highly capable and skilled staff members are our greatest asset. We aim at attracting talents and retaining efficient employees. We have implemented incentives that are in line with employee's performance and bank's total profitability.
Before I conclude, I should say again that we are in right track and we are growing stronger. Our results are impressive compared to the size of the bank. But we are pledgebound to turn Standard Bank into a modern dynamic institution. We are committed to remain fair, transparent and responsible bank with corporate governance.
Finally, I must say that we are grateful to our regulatory authorities, valued shareholders, Security Exchange Commission, Dhaka and Chittagong Stock Exchanges, respected customers and other stakeholders for their continued support. Our Board in general and Honorable Chairman in particular have put in relentless efforts in guiding the Bank's strategies and providing us with invaluable suggestions in all important matters. May Allah bless us all.
