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Assignment On Mercantile Bank Limited Annual Report for the year ended 31st December, 2009 Topics are to be discussed here (Context) 01. Letter to Transmittal 02. Notice of 11th Annual General Meeting 03. Mission, Vision & Objectives 04. MBL Timeline 05. Credit Rating 06. Sponsors of the Bank 07. Board of Directors 08. Corporate Structure 09. Management Team 10. Head Office & Branch Network 11. Where We Locate 12. Financial Summary 13. Economic Impact Report 14. Message from the Chairman 15. From the Desk of Managing Directors and CEO 16. Directors’ Report 17. Managing Directors and CEO’s Report on Risk Management 18.
Report on Corporate Governance 19. Compliance Report on SEC Notification 20. Report of Audit Committee 21. Report on Corporate Social Responsibility 22. Report on Customer Service 23. Report on Human Capital 24. Recognition 25. Signing of Financial Statements 26. Auditors’ Report 27. Financial Statements 28. Notes to the Financial Statements 29. Annexure A-G 30. Highlights of Mercantile Bank Limited 1. Letter to Transmittal: Here the Executive Vice President and Company Secretary wrote a letter to all shareholders informing the important items of the Annual Report.
Such as Balance Sheet, Income Statement, Cash Flow Statement of the year. 2. Notice of 11th Annual General Meeting: In the notice the date, year, day, time and place of the AGM clearly (in bold letter) described. Important Agenda also represented in the notice. There are 5 Agenda are mentioned. In addition 6 footer Notes also published here. Important notes are record date of the share (March 07, 2010), amount of dividend (22%) etc. Executive Vice President and Company Secretary give his signature with date. 3. Vision, Mission & Objectives: The Vision of the back is make finest corporate institution.
Mission is making the make profitable by caring, equitable growth by required and proper distribution of recourses. Strategic Objectives: to positive Economic Value Added, market leader in product innovation, achieve cost efficiency, be in the top five financial institution in Bangladesh. Financial Objectives: to achieve stable (? 20%) return on shareholders’ equity. Moreover Core value for Customers, Shareholders, Employees and Community 4. MBL Timeline: Here the development of Mercantile Bank Limited stated. It started incorporation in business and commercialization in 1999. Circulated Primary Share (IPO) in 2003.
Got listed in both Bangladesh Stock Exchanges (Dhaka & Chittagong) in 2004 and end of year 2009 it has 50 braches all over the country. 5. Credit Rating: As per Credit Rating and information Services Limited (CRISL), Mercantile Bank Limited rated as “A” (Pronounced as Single A) in the long term and ST-2 rating in the short term on the basis of Financial Statements as on December 31, 2008. High certainty of timely payments, strong liquidity factors, good company fundamentals, easy excess to capital market and minimal risk factors are the key issues of the rating. 6. Sponsors of the Bank:
Here the 27 sponsors’ names with photos are representing clearly. 7. Board of Directors: 22 Directors’ name and photo with their designation stated here. There are 1 Chairman, 2 Vice Chairmen and 18 Directors and 1 Managing Director and CEO in the Bank managing committee. 8. Corporate Structure: In Corporate Structure there are 8 different government body represented. Including Board of Directors (22 persons), Executive Committee (18 persons), Audit Committee (3 persons), Managing Director & CEO (1 person), Chief Financial Officer (1 person), Company Secretary (1 person), Auditors (2 persons) and Tax Advisor (1 person). . Management Team: Here the detail list of different managing committee separately represented with their designation. There are 10 categories of designation. Such as Managing Director & CEO, Additional Managing Director, principal, Deputy Managing Director, Senior Executive Vice Presidents, Executive Vice Presidents, Senior Vice Presidents, Vice Presidents, First Vice Presidents and Assistant Vice Presidents. 10. Head Office & Branch Network: Under this title the details addresses of bank’s all 50 banking branches, SME braches and Brokerage House with Phone, Mobile and Fax number given. 1. Where We Locate: Here the map of Bangladesh given and all 53 (3 SME/Agro Branches) branches marked by company’s logo under district wise. 12. Financial Summary: Under Financial Summary Company’s last 5 years Net Interest Margin (NIM), Profit after Tax, Return on Assets (ROA), Cost Income Ratio, Return on Equity (ROE), Operating Efficiency Ratio and in the last 8 years comparable company’s Income Statement, Balance Sheet, Foreign Exchange Business, BIS Capital Measure, Credit Quality, Share Information, Operating Performance Ratio and Other Information represented. 3. Economic Impact Report: Here Economic Impact described in two ways; Direct Impact and Indirect Impact. Direct Impact are employment opportunities, payment of tax to the government, increase value to the Shareholders. Indirect Impact created by catering financial services, Bank generated wealth in the economy and profit for itself which is ultimately distributed amongst the shareholders and other participants in different form. In 2009, total value added by MBL was BDT 2,559. 96 (millions) and direct contribution to the economy was BDT 855. 26 (millions).
There are two value added statements (Economic and Market) showed by column chart. A pie chart showed for distribution of Value Addition (maximum for government tax 33. 4%). Bank added BDT 129. 5 (million) under Economic Value Addition and BDT 4229. 48 (million) under Market Value Addition. 14. Message from the Chairman: At the first of the message the Chairman invited Shareholders to the 11th Annual General Meeting. There are some topics the Chairman discussed briefly. Those are: World Economy in 2009: here the impact of sub-prime mortgages landslip discussed.
Bangladesh Economy in 2009: here the benefit of growth Bangladesh economy in the particular year stated. Performance of the Bank in 2009: here the actual amount of bank’s deposits collection, loan and advance, import business, export business and foreign remittance described. Diversified Business Activities of the Bank: under this section the details activity of bank represented here. Such as Deposits, Loan and Advances, Import & Export Business and Inward Foreign Remittance. SME: here bank’s SME structure described.
Card Business: here bank’s different card business represented. Such as Credit card, Debit Card, VISA dual prepaid card, VISA Dual Hajj Card. Described it’s features and services. Corporate Governance Practice: here the responsibilities and activities of Board of Directors to the business operation represented. CSR Programs: here the guideline of management of the bank informs the board on CSR activities and is responsible to implement a specific line of approving authority, control and monitoring for financial support of such activities.
Customer Service: here the Chairman describe how the bank server to the customer for achieve highest customer satisfaction. Human Resources Development: here the promotion and intensives to the employees represented for their superior performance. Recognition and Award: here the different achievements and rewards stated that in 2009 the bank gets thorough out the year. Future Outlook: here the challenges and opportunities for the bank in upcoming years described thoroughly. Challenges in 2010: here the economic effect on the bank in year 2010 is represented.
Such as global downturn, slower growth of exports and workers’ remittance etc. Acknowledgement: here the Chairman gives his thank you notes and committed a stable growth of back where shareholder can rely on. 15. From the Desk of Managing Directors and CEO: Here the CEO describes the banks’ situation in the year 2009. He also represented Bank’s performance during the year 2009, its prospects and potential challenges in 2010. Such as Positive Growth: A Step Further: describing here the growth of the bank during the year. Prospects in 2010: he describe the opportunity, hope for the bank in upcoming year.
Reviewing Our Business in 2009: here the business operation during the year stated clearly. Assets and Liabilities Position, International Business, MBL’s Products and Services, MBL’s Card Business, Agro-Based Financing, SME Financing, Our Priorities, Operation, Customer Relationship, Technology, Human Capital Development, Corporate Social Responsibilities (CSR), MBL Brokerage House, Mobile Banking, Commitment to Government, Base I-II Capital Accord, Anti Money Laundering, Network Expansion, Challenges in 2010, Our Preparation and Acknowledgement are the main topics he discussed. 6. Directors’ Report: The parts of the Director’s Report are World Economy, Bangladesh Economy (GDP, Inflation, Investment and Saving, Broad Money, Domestic
Credit, Export, Import, Trade Balance, Remittance, Foreign Exchange Market, Prospect of Bangladesh Economy in 2010), Business Review (Deposit and Deposit Mix, Loan and Advance, Import Trade, Export Trade, Foreign Remittance, Treasury Operation and Fund Management, Earning Base in Assets, Asset Portfolio, Funding Structure, Capital, Statutory Reserve, Capital Adequacy, Number of Shareholders, Contribution to National Exchequer and Economy, Acquisition of IDLC Share, Purchase of Land, Branch Network, Board of Directors, Board and Committee Meeting, Corporate and Financial Reporting, External Auditors, Correspondence Relationship , R, Information Technology, Financial Products and Services, Different Deposit Products, Different Loan Products), Financial Review (Different Profit Incomes, Different Expenses, Different Tax, Dividend, EPS, O/E Ratio), Outlook 2010 and Acknowledgement are represented here. After that it repeated in Bengali Language. 17. Managing Directors and CEO’s Report on Risk Management: Here start with basic discussion on Risk Management. Such as Risk Management Realities, Approach, Oversight, Process etc. And later describe different types of Risk Management described with photo and tree table.
Such as Credit Risk Management, Market Risk Management, Interest Rate Risk Management, Foreign Exchange Risk Management, Operational Risk Management, Internal Control and Compliance Risk Management, Equity Risk Management, Money Laundering Risk Management, Information Technology Risk Management, Liquidity Risk Management, Marketing Related Risk Management, Human Resource Related Risk Management etc. 18. Report on Corporate Governance: At first different names of Corporate Governance with responsibility and duty in the bank represented. Such as Board Of Directors, Board’s Supporting Committee, Management Committee, Control Environment Committee.
Each of every committee are presented with meetings photo. 19. Compliance Report on SEC Notification: It is the notification issued by The Security and Exchange Commission for all listed companies in order to improve Corporate Governance on ‘Comply or Explain’ basis. There are three tables. First is Complied or Not Complied table. Only 3 rules are not complied by the bank among 43 rules which are under review. In second table the numbers with names of Directors attained Board Meeting during the year. And the last one is The Patter of Shareholding where shows the nos. and percentage of shares hold by Directors. 20. Report of Audit Committee: Here the name of Auditor with photo presented.
And also some other topics such as composition of the Audit Committee, Role of the Audit Committee, Internal Control, Meetings, Financial Reporting, Internal Audit and Inspection, External Audit, Regulatory Compliance and Miscellaneous issues given here. 21. Report on Corporate Social Responsibility: Here the roles and responsibilities of the bank toward society described. In this section a table shows how much the bank contributed their profit to the society. The highest donation went to health sector. MBL has slogan to be the “Banglar Bank”. MBL has given different awards to different sectors. Photos and arenas are mentioned here. 22. Report on Customer Service: The importance of customer to the bank is presented here. Some core demands of customer are fulfilling by the back.
Such as Bringing Mass and More people into the Banking net, Addressing Unique Needs of the Customers, Meeting Demand of Customers through Alternative Banking Channels, Response from the People etc. 23. Report on Human Capital: In this topic the process of giving service in effective manner the back took some steps such as Nursing the People with Utmost Care, Recruiting the Best People (bonus, promotion, recognition, training etc), Managing the people, Performance from the People etc. 24. Recognition: An award giving ceremony’s (ICAB Award-2008) photo given here. 25. Signing of Financial Statements: Here a photograph of Directors represented where they all present there for signing Financial Statements – 2009. 26. Auditors’ Report: At first Auditors declared those elements that they audited.
Such as Balance Sheet, Profit and Loss account, Cash Flow Statement, Statement of Changes in Equity, Statements of Liquidity Analysis and Explanatory notes to Financial Statements. Also mention their responsibilities. In the auditor’s report they include Scope, Opinion (14 opinions), Auditors Firm Names, Auditor Signatures, Auditor Designation, Place and Date. 27. Financial Statements: In the Financial Statements there are 7 part of it. At first there is Balance Sheet (Classified Statement of all types of Assets and Liabilities), then Off-Balance Sheet Items (Contingent Liabilities and Other Commitments), Profit and Loss Account (Include all types of Incomes and Expenses, Provisions, Appropriations etc. , Cash Flow Statement (Net Cash Inflow and Outflow recorded here), Statement of Changes in Equity (Capital gain/reserve and losses/dividend), Liquidity Statement (assets and liabilities maturity analysis), Notes to the Financial Statements (details of financial statement such as calculations, principals, disclosures etc). 28. Annexure A-G: In Annexure A all related asset’s depreciation charges calculated here, Annexure B described number of shares hold by Directors with their positions, Annexure C represented different Investment in Shares during the year. Annexure D stated market adjustment of approved Securities HTM and HFT shares. Annexure E mentioned maturity analysis of other assets (like as advanced deposits, stamps in hand etc. , Annexure F represented Compliance of BAS and BFRS (among 29 BAS 6 are not applied and among 4 BFRS none are applied), Annexure G provide Computation of Risk- Weighted Assets list. 29. Highlights of Mercantile Bank Limited: Here all necessary information towards the investors are presented here, such as paid-up capital, total assets, total deposits, ROA, ROI, EPS, NI per share, P/E Ratio etc. 30. Proxy Form: It is the application printed and provided by the firm to shareholders incase of his absence, shareholder can give voting power to his nominated person. Need to fill up the gaps and attach revenue stamps and send to the authority before particular date. It has two parts, one for office and other for shareholder. ————-END————–