Presentation about SIBL

Chapter-1
Introduction and Overview of
SIBL

Individual Performence given by
Versatile Boy Maruf

 1.1 Introduction
Social Islami Bank Limited(SIBL) was incorporated on 5th July, 1995 as a
result of dedicated effort of a group of established Bangladeshi
entrepreneurs and internationally important personalities. The bank started
commercial operation on 22nd November, 1995 with a clear manifesto to
demonstrate the operational meaning of particularly economy, banking and
financial activities as an integrated part of Islamic code of life. Targeting
poverty, SIBL is indeed a concept of 21st Century participatory several
sector banking modes. The formal corporate sector, this Bank would,
among others, offer the most up-to date banking services through opening
of various types of deposit and investment accounts, financing trade,
providing letters of guarantee, opening letters of credit, collection of bills
effecting domestic and international transfer, leasing of equipment and
consumer durables, hire purchase and installment sale for capital goods,
investment in low-cost housing and management of real estates,
participatory investment in various industrial, agricultural , transport,
educational and health projects and so on. In the Non-formal non-corporate
sector, it would, among others, involve in cash Waqf Certificate and
development and management of WAQF and MOSQUE properties, and
Trust funds.

1.2 Management Hierarchy: Chairman
Managing Director
Deputy Managing
Director
Executive President
Senior Vice
President
Vice President
Senior Assistant Vice
President
Assistant Vice
President
First Assistant Vice
President
Senior Executive
Officer
Executive Officer
Senior Officer
Officer
Junior Officer

Chapter-2
Mission, Vision, Moto

2.1 Mission of SIBL:
 Establishing Three Sector Banking Model
 Transformation to a service oriented technology driven profit
earning Bank
 Fast, accurate and satisfactory customer service
 Balanced & sustainable growth strategy
 Optimum return on shareholders’ equity
 Introducing innovative Islamic Banking Products
 Attracting and retaining high quality human resources
 Empowering real poor families and creating local income
opportunities
 Providing support for social benefit organizations by way of
mobilizing funds and social services

2.2 Vision of SIBL:
 Working together for a caring society. In its journey
towards continuous excellence SIBL is striving to
become the Country‟s leading Islamic Bank offering
one-step service of an wide range of value added
products and services meeting the needs of the
customers; conducting the business ethically in
accordance with the laws of Shari‟ah while
optimizing best utilization of the most modern state-
of-the-art technological solutions through creation
of a pro-active organizational culture based on
sound team spirit, fairness, mutual understanding
and pragmatic leadership always remaining open to
new ideas and adaptable to the best practices in
the market ensuring recognition and quality banking
experience to the customers and deliver best value
to all the stakeholders as well.

2.3 Moto/Slogan of SIBL
With the new journey SIBL has started its new
slogan to add a new dimension in their service. The
slogan is the indicator o its continuous improvement
to create the excellent service condition for the
clients.

 4.1 Liquidity Ratio
 4.1.1 Current Ratio
 The current ratio is one of the most commonly financial ratios
measures the bank’s ability to meet its short term obligations.
The higher the current ratio, the better the liquidity position of
the bank.
 Current Ratio= Current Asset/ Current Liabilities
Year 2011 2012 2013 2014 2015
Current Asset 3852.84 9468.71 5700.06 6327.16 3275.1 5
Current
Liabilities
79569.56 104,676.17 115,309.14 141,412.32 167,053.52
Current Ratio 0.48 0.90 0.49 0.45 0.19

 Graphical Presentation:
 Interpretation: We know that the current ratio measures a firm’s
liquidity by measuring the portion of its current asset relative to its
current liabilities and the higher the ratio, the higher the liquidity of the
firm. This graph shows that a fluctuating trend in SIBL’s liquidity position
from 2011 to 2015. The current ratio has initially increased but later on
current ratio has decreased from 0.90 in 2012 to 0.19 in 2015.
0.48
0.9
0.49
0.45
0.19
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
1
2011 2012 2013 2014 2015
Current Ratio

 4.2 Activity Ratios
 4.2.1 Total Asset Turnover
 Total asset turnover indicates the efficiency with which the firm is able to
use all its assets to generate sales. The formula is as follows:
 Total Asset Turnover= Total Income / Total Asset (Tk. in Millions)
Year 2011 2012 2013 2014 2015
Total Income 4,955.62 5,549.45 5,560.46 6,798.43 8,291.92
Total Asset 84406.18 115165.95 126616.56 1537374.67 180112.11
Total Asset
Turnover
0.059 0.048 0.044 0.004 0.046

 Graphical Presentation :
 Interpretation: The graph shows that, the total assets turnover of SIBL is
fluctuating trend from 2011 to 2015. From 2011 the total assets turnover
is decrease to 2014 later on in 2015 total assets turnover shifted from
0.004 to 0.046.
0.059
0.048
0.044
0.004
0.046
0
0.01
0.02
0.03
0.04
0.05
0.06
0.07
2011 2012 2013 2014 2015
Total Asset Turnover

 4.2.2 Credit to Deposit Ratio
 Credit to deposit ratio is an important ratio specially for Banks. It
is the proportion of loan-assets created by banks from deposits
received. The higher the ratio the higher the loan-assets created
from deposits. Formula is as follows:
 Credit to deposit ratio= Total Loan & Advance / Total Deposit
(Tk. in Millions)
Year 2011 2012 2013 2014 2015
Total Credit
(Gross)
3852.84 9468.71 5700.06 6327.16 3275.15
Total Deposit 66852.55 93594.29 102104.48 124535.01 149773.62
Credit to
deposit ratio
5.85 10.1% 5.6% 5.1% 2.2%

 Interpretation: From the graph we can see that credit to deposit
ratio was in decreasing trend for last couple of years, which is not a
good indicator of bank performance. The ratio was increased from
5.80% in 2011 to 10.1% but decreasing 2.20% in 2015.
5.80%
10.10%
5.60%
5.10%
2.20%
0.00%
2.00%
4.00%
6.00%
8.00%
10.00%
12.00%
2011 2012 2013 2014 2015
Credit to deposit ratio

 4.3 Debt Ratios
 4.3.1 Debt Ratio
 Debt ratio is a ratio that indicates the proportion of a company's debt
to its total assets. It shows how much the company relies on debt to
finance assets
 Debt ratio = Total Liabilities / Total Assets (Tk. in
Millions)
Year 2011 2012 2013 2014 2015
Total Liabilities 79569.56 104,676.17 115,309.14 141,412.32 167,053.52
Total Assets 84406.18 115165.95 126616.56 1537374.67 180112.11
Debt ratio 94.3% 90.9% 91.1% 92.0% 92.7%

 Interpretation: Every origination should give more emphasize on
equity capital than debt capital. Here, we can see that the SIBL debt
ratio is decreasing from 2011 to 2015. In 2011 debt ratio was 94.30%
and it decreased to 92.70%.
94.30% 90.90% 91.10% 92.20% 92.70%
-50.00%
0.00%
50.00%
100.00%
150.00%
200.00%
250.00%
2011 2012 2013 2014 2015
Debt Ratio

 4.3.2 Debt to Equity Ratio
 The debt-to-equity ratio (debt/equity ratio, D/E) is a financial ratio
indicating the relative proportion of entity's equity and debt used to
finance an entity's assets. This ratio is also known as financial
leverage.
 Debt-to-equity ratio =Total Liabilities / Shareholder’s Equity
(Tk. in Millions)
Year 2011 2012 2013 2014 2015
Total
Liabilities
79569.56 104,676.17 115,309.14 141,412.32 167,053.52
Shareholder’
s Equity
9412.21 10181.97 11083.43 12143.38 129503.22
Debt-to-
equity ratio
8.45% 10.28% 10.40% 11.64% 11.29%

 Interpretation: The graph shows that SIBL’s debt to equity ratio is
increasing year by year. The ratio was lowest in the year 2011 and it
increased to its highest position in the year of 2014. This indicates more
creditor financing is used than investor financing.
8.45
10.28 10.4
11.64
11.29
0
2
4
6
8
10
12
14
2011 2012 2013 2014 2015
Debt-to-equity Ratio

 4.4 Profitability Ratios
 4.4.1 Cost to Income Ratio
 Cost to income ratio is the ratio between operating expenses and
operating income. It is a measure of how costs are changing
compared to income. It is one of the main key Bank. Formula of cost
to oncome ratio:
 Cost to Income Ratio= Total Operating Expenses/ Total Operating
Income (Tk. in Millions)
Year 2011 2012 2013 2014 2015
Total Operating
Expenses
1377.45 943.90 1228.50 11,753.80 12,455.80
Total Operating
Income
4146.025 1305.68 1520.95 15,718.08 17,305.68
Cost to Income
Ratio
33% 72% 81% 75% 72%

 Interpretation: The graph shows that SIBL’s cost to income ratio is
fluctuating year by year. The ratio was lowest in the year 2011 in 33%
and it increased to its highest position in the year of 2013 in81%. It
decreased from 81% in 2013 to 72% in 2015.
33%
72%
81%
75%
72%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
2011 2012 2013 2014 2015
Cost to Income Ratio

 4.4.2 Operating Profit Margin
 The Operating profit margin represents what are often called the
pure profits earned on each sales dollar. A high operating profit
margin is preferred. The operating profit margin is calculated as
follows:
 Operating Profit Margin= Operating Profit / Revenue
(Tk. in Millions)
Year 2011 2012 2013 2014 2015
Operating
Profit
2768.58 361.78 292.45 3964.28 4849.88
Revenue 2768.80 3617.82 2924.55 3964.27 4849.82
Operating
Profit Margin
0.99 0.10 0.10 1.00 1.00

 Interpretation: The graph shows that the operating profit margin has
increased over the year. The total asset turnover has increased from 0.1
in 2013 to 1.0 in 2015. The SIBL total operating profit margin is
increasing day by day and which is good sing.
0.99
0.1 0.1
1 1
0
0.2
0.4
0.6
0.8
1
1.2
2011 2012 2013 2014 2015
Operating Profit Margin

 4.4.3 Net profit Margin
 The net profit margin measures the percentage of operating profit
remaining after all expenses, including taxes, have deducted. The
higher the firm’s net profit margin is better. The net profit margin is a
commonly cited measure of the bank’s success with respect to
operating profit. The net profit margin ratio is calculated as:
 Net Profit Margin= Net profit after taxes / Operating Income
(Tk. in Millions)
Year 2011 2012 2013 2014 2015
Operating
Income
4,955.62 5,549.45 5,560.46 6,798.43 8,291.92
Net profit
after taxes
1083.42 1441.13 1220.20 1903.72 2072.59
Net Profit
Margin
22% 26% 22% 28% 25%

 Interpretation: Net profit margin shows how good a company is at
converting revenue at profit. In this figure, Net profit margin is
fluctuating from 2011 to 2015. But in 2014 net profit margin
dramatically increased to 28 % and it indicates a good sign for the
bank.
22%
26%
22%
28%
25%
0%
5%
10%
15%
20%
25%
30%
2011 2012 2013 2014 2015
Net Profit Margin

 4.4.4 Return on Asset (ROA)
 This measures how efficiently profits are being generated from the
assets employed in the business when compared with the ratios of
firms in a similar business. A low ratio in comparison with industry
averages indicates an inefficient use of business assets. The Return
on Assets Ratio is calculated as follows:
 Return on Assets =Net Profit Before Tax / Total Assets
(Tk. in Millions)
Year 2011 2012 2013 2014 2015
Net Profit
Before Tax
1901.28 2747.89 2024.66 3307.52 3479.17
Total Assets 84406.18 115165.95 126616.56 153737.48 180112.11
Return on
Assets
2.25% 2.38% 1.60% 2.15% 1.93%

 Interpretation: The graph shows a downward trend in return on
asset of SIBL except 2012. In this figure it has been seen that SIBL’s
return on asset was increasing from 2.25 in 2011 to 2.38 in 2012 but
after that it was decreased which is bad sign for the bank. So,
management should work hard to increase return on terms of assets.
2.25%
2.38%
1.60%
2.15%
1.93%
0.00%
0.50%
1.00%
1.50%
2.00%
2.50%
2011 2012 2013 2014 2015
Return on Assets

 4.4.5 Return on Equity (ROE)
 The return on equity is the amount of net income returned as a
percentage of shareholder’s equity. Moreover, the return on
equity estimates the profitability of a corporation by revealing
the amount of profit generated by a company with the money
invested by the shareholders. Also, the return on equity ratio is
expressed as a percentage and is computed as:
 Return on Equity (ROE)= Net Income / Shareholder's Equity
(Tk. in Millions)
Year 2011 2012 2013 2014 2015
Net Income 3,465.95 3,783.58 3,945.72 4,977.03 6,290.88
Shareholder's
Equity
9412.21 10181.97 11083.43 12143.38 12950.322
Return on
Equity (ROE)
37% 37% 36% 41% 49%

 Interpretation: The graph shows an upward trend in return on equity
of SIBL except the last year. This indicates that It was increasing
from 37% in 2011 to 49% in 2015. This is positive sign for the bank.
37% 37% 36%
41%
49%
0%
10%
20%
30%
40%
50%
60%
2011 2012 2013 2014 2015
Return on Equity (ROE)

 4.4.6 Earnings per share (EPS)
 The firm’s Earning per share (EPS) are generally of interest to
present or prospective stockholders and management. The Earning
per share represent the number of dollars earned on behalf of each
outstanding share of common stock. The earning per share is
calculated as follows:
 Earnings Per Share= Earnings available for stockholder / No. of
shares of common stock outstanding (Tk. in Millions)
Year 2011 2012 2013 2014 2015
Earnings
available for
stockholder
9412.21 10181.97 11083.43 12143.38 12950.322
No. of shares of
common stock
outstanding
639.39 639.39 703.14 703.14 703.14
Earnings Per
Share
14.72% 15.92% 15.76% 17.27% 18.41%

 Interpretation: The earning per share represent the number of taka
earned on behalf of each outstanding share of common stock. The
graph shows that the firm’s earning per share has increased over
year from 14.72 on 2011 to 18.41 in 2015 which is positive sing for a
firm.
14.72
15.92 15.76
17.27
18.41
0
2
4
6
8
10
12
14
16
18
20
2011 2012 2013 2014 2015
Earning Per Share (EPS)

 4.5 Market Ratios
 4.5.1 Price/Earnings ratio (PE ratio)
 The price or earning (P/E) ratio is commonly used to assess the
owner’s appraisal of share value. The P/E represents the amount
investors are willing to pay for each dollar of the firm’s earning. It’s
calculated:
 Price/Earnings Ratio= Market price per share / Earning per share
(Tk. in Millions)
Year 2011 2012 2013 2014 2015
Market price
per share
18.20 19.40 13.30 13.60 14.40
Earnings per
share
1.81 2.25 1.74 2.71 2.95
Price/Earnins
Ratio
10.06% 8.62% 7.64% 5.02% 4.88%

 Interpretation: The price earnings ratio represents investors’
confidence firm’s performance has reduced over the years. The
graph shows that the firm’s price earnings ratio has decreased over
year which is negative sing for a firm.
10.06
8.62
7.64
5.02 4.88
0
2
4
6
8
10
12
2011 2012 2013 2014 2015
Price/Earning Ratio (PE Ratio)

Chapter-5
Comparative Analysis of SIBL

5.1 Cost to Income Ratio
 The operating cost to income ratio is a key financial measure,
particularly important in valuing banks. It shows the bank’s costs in
relation to its income. It is calculated by:
 Operating cost to income ratio= Total operating Cost / Total
Operating Income
Year 2011 2012 2013 2014 2015
Industry
Average
68.6% 74.0% 73.20% 67.95% 64.30%
Social Islami
Bank
Limited
33.21% 72.26% 80.79% 74.77% 71.97%

 Interpretation: The graph shows that, the cost to income ratio of the
SIBL is lower than industry average over the year. However, the cost of
income of the industry average has decreased over the years. From
2011 to 2015, cost to income ratio decreased from 68.60% to 64.30%.
We know, the lower cost to income ratio is the more efficient the firm is
running, So, Bank should decrease the cost.
68.60%
74% 73.20%
67.95% 64.30%
33.21%
72.26%
80.79%
74.77%
71.97%
0.00%
20.00%
40.00%
60.00%
80.00%
100.00%
120.00%
140.00%
160.00%
180.00%
2011 2012 2013 2014 2015
Cost to Income Ratio
Industry Average Social Islami Bank Ltd

 5.2 Return on Assets (ROA)
 The return on asset (ROA), which is often called the company’s
return on total assets, measures the overall effectiveness of
management in generating profits with its available assets. The
higher the ratio is better. The return on assets ratio formula is
calculated by:
 Return on Assets = Profit After Tax / Average total assets
Year 2011 2012 2013 2014 2015
Industry
Average
1.5% 0.60% 0.88% 0.64% 0.94%
Social Islami
Bank Limited
1.28% 1.25% 0.96% 1.24% 1.15%

 Interpretation: The graph shows that, the ROA of SIBL is higher
than industry average in every year.
1.50%
0.60%
0.88%
0.64%
0.94%
1.28%
1.25% 0.96% 1.24%
1.15%
0.00%
0.50%
1.00%
1.50%
2.00%
2.50%
3.00%
2011 2012 2013 2014 2015
Return on Assets (ROA)
Industry Average Social Islami Bank Ltd.

 5.3 Return on Equity (ROE)
 The return on equity measures the return earned on the owner’s
(both preferred and common stockholder’s) investment. Generally,
the higher the return is better for the owner’s. the return on equity
ratio formula is calculated by:
 Return on Equity= Net profit after tax / Average shareholder’s equity
Year 2011 2012 2013 2014 2015
Industry
Average
17.0% 8.2% 8.09% 10.80% 12.3%
Social Islami
Bank Limited
11.51% 14.15% 11.01% 15.68% 16.01%

 Interpretation: The graph shows that, the ROE of SIBL is higher
than industry average in every year.
17%
8.20% 8.09%
10.80%
12.30%
11.51%
14.15%
11.01%
15.68%
16.01%
0%
5%
10%
15%
20%
25%
30%
2011 2012 2013 2014 2015
Return on Equity (ROE)
Industry Average Social Islami Bank Ltd.

Chapter-6
Recommendation
And Conclusion

 6.1 Recommendations
 It is not unexpected to have problems in any organization. There must be
problems to operate an organization. But there must be remedies to follow. The
following commendations can be suggested to solve the above-mentioned
problems:
 Decentralized decision making is really essential for going forward. In the credit
department, strict supervision is necessary to avoid loan defaulters. Bank officials
should do regular visit to the projects. Attendance system needs to update which
will help the transparency and time keeping to them.
 Performance of IT division should be improved which is badly in need them for.
An uninterrupted network system has to be ensured It. will save the
officials from much hassle and will save time. Reviewing market conditions and
taking precautionary measures towards facing abnormal market situation and
weakness of investments of the Bank.
 SIBL may also indulge in Tele Marketing. This will smooth the progress of them to
expand their sales. SIBL should appoint customer service officers in all branches.
They solve customers’ problem, answer inquiry of customer’s.
 Campaigning is important to build up a strong image reputation among the
potential customers, such as ad in the newspaper & magazine, billboard, publicity
message. SIBL can pursue promotion campaign with its customers particularly the
corporate clients to build up a strong report.

 6.2 Conclusion
 The evaluation process of performance of IBBL and SIBL in my report,
highlighted different ranks for using CAMEL ratios. About capital
adequacy ratio IBBL was at the top position, whereas SIBL got lowest
rank. Poor performance of SIBL in debt-equity, advances to assets is
the probable reason of this. IBBL obtained the top rank while SIBL held
the lowest rank in asset quality ratios. Poor performance of SIBL in net
NPAs to net advances, total investments to total assets and net NPAs
to total assets ratios is the reason of getting last. First place is taken by
SIBL and lowest rank taken by IBBL in management efficiency. This is
likely to be the poor performance of IBBL in total advances to total
deposits, profit per employee and business per employee ratios.
Competence of SIBL got the top rank in the while IBBL was at the
lowest position in earning quality.

References
 http://www.siblbd.com/

 http://www.siblbd.com/home/branches

 http://www.siblbd.com/home/annual_reports

 http://www.bangladesh-bank.org/

 http://www.bangladesh-bank.org/econdata/index.php

 http://www.sjiblbd.com/

 http://www.assignmentpoint.com/business/finance/a-report-on-social-islami-bank-imited- part-1.html

 http://www.studymode.com/subjects/internship-report-on-social-islami- bank-limited-of- bangladesh-page1.html

 Internship report for financial analysis on UBL, BUBT

 http://knowledge.wharton.upenn.edu/article/a-brief-history-of-modern-banking/


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