A Demand-Supply Analysis of the Islamic Banking system in Bangladesh and the role of SCB Saadiq to meet the discrepancies, if any
Dr. Neaz Ahmed Professor
Ivdad Ahmed Khan Mojlish Roll: 43 Batch: BBA 13th
June 24, 2009
Institute of Business Administration University of Dhaka
June 24, 2009
Professor G M Chowdhury Chairman Internship & Placement Program Institute of Business Administration (IBA) University of Dhaka
Subject: Submission of Internship report
I am very pleased to submit my Internship report on "A Demand-Supply Analysis of the Islamic Banking System in Bangladesh and the role of SCB Saadiq to meet ...view middle of the document...
I would like to thank and acknowledge my organizational Supervisor Mr. Kamran Sunjoy Rahman, Head of Islamic Banking, Standard Chartered Bank and Mr. Zia Hassan Siddique, Branch Manager, Standard Chartered Saadiq for giving me such a great opportunity and providing me with immense help and support whenever needed.
I would also take this opportunity to thank the elite SCB Saadiq customers who have patiently helped me in my FGD sessions. Their insightful opinions helped me a lot to analyze the demand side of my study, which was a partial requirement.
Islamic banking is now a reality in Bangladesh. It is functioning efficiently, smoothly and satisfactorily despite facing various internal and external threats. The last decade has seen a sharp expansion in the Islamic Financial industry. Many banks are converting fully into Islamic mode of operations while others are at least opening up Islamic wings to keep from losing customers.
Despite this high growth and coverage, the penetration of Islamic banking has a long way to go. It is estimated that in Bangladesh the share of Islamic banking assets in total banking assets is only 5-6% percent. Like conventional banks, Islamic banks have to develop robust corporate governance standards, prudent risk management framework and subjected to effective regulation and supervision. Empirical evidence shows that banks with weak corporate governance have failed more often.
This report mainly analyses the Islamic banking system prevalent in Bangladesh. Basically, the report is divided into two parts. The first part analyses the Islamic banks’ comparison in terms of their market share and customer approaches, followed by a supply analysis of some selective semi-Islamic banks. In the second part, Standard Chartered Saadiq has been discussed in details to understand their positioning in the industry. Deepening customer feedback is put forward to assess the demand-side policies and then an overall market share comparison among all banks is dissected.
Studies reveal that there is a crying need for quality Islamic products which is only provided by a handful of banks. It also reveals that the total market share lies in the hands of a few market players and unsurprisingly, 95% of the total market share rests with the complete Islamic banks. SCB Saadiq can leverage its vast experience in the banking line and share experiences from the Malaysia and Dubai’s banking system to shed light on the burning issues. However, studies also reveal that Saadiq, as of now, possesses a minute share of the entire Islamic sector.
It has to concentrate on accomplishing short-term targets to develop and hone its banking practices...