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Mercantile Bank Limited a scheduled commercial bank in the private sector incorporated in Bangladesh under the Banking Companies Act 1991. The bank was established by 30 sponsors and it started its operations on 2 June 1999 with an authorised capital of Tk 800 million divided into 8 million ordinary shares of Tk 100 each. On 31 December 2001, its paid up capital was Tk 596.5 million. Following the provisions of the Banking Companies Act 1991, the bank maintains a capital adequacy ratio of 8% of the risk-weighted value of its total assets. Total shareholders' equity was Tk 348.99 million in December 2000. Reserve funds of the bank comprise only statutory reserves, which were Tk 34.65 million in 2000. On 31 December 2000, the liabilities of the bank were borrowings (Tk 2,590 million), deposits (Tk 5,981.27 million), bills payable (Tk 63.85 million), shareholders' equity (Tk 348.98 million), and others (Tk 380.40 million). The assets of the bank at that time were cash in hand (Tk 98.77 million), balance with other banks (Tk 2,500.40 million), money at call and short notice (Tk 1,897.50), investments (Tk 450.32 million), loans and advances (Tk 3,251.30 million), bills purchased (Tk 661.67 million), premises and fixed assets (Tk 51.39 million), and other assets including off-balance sheet items (Tk 235.46 million). The bank introduced some innovative deposit schemes such as Monthly Profit Payment Project, Monthly Savings Project, and Advanced Savings Project. The bank finances large-scale enterprises through a consortium of banks and also provides loans to small and medium businesses. In December 2000, total loans and advances of the bank stood at Tk 3,251.30. The loan portfolio comprised general loans (Tk 236.86 million), loans against trust receipts (Tk 746.46 million), packing credit (Tk 155.09 million), lease finance (Tk 67.63 million), hire purchase (Tk 324.79 million), payment against documents (Tk 205.30 million), cash credit or hypo (Tk 483.73), consumer credit (Tk 207.06 million), house building loans (Tk 6.38 million), staff loans (Tk 9.13 million), and other credit schemes (Tk 37.62 million). The bank had no classified loan up to 31 December 2000. Investments of the bank other than loans and advances on 31 December 2000 stood at Tk 450.32 million and the investments are made in government treasury bills (Tk 450 million and prize bonds (Tk 0.32 million). The bank earned interest incomes of Tk 16.26 million in 2000. Its profits increased from Tk 4.59 million in 1999 to Tk 69.33 million in 2000. Foreign exchange businesses handled by the bank in that year amounted to around Tk 2,498 million. The bank processed approximately 1,600 letters of credit up to December 2000. Meanwhile, the bank established correspondent relationships with 15 banks and financial institutions abroad.
The bank has its head office at Dhaka. It is governed
by a 21-member board of directors with a managing director as the chief
executive. In December 2001, it had 14 branches and 305 employees including
the executive officers.
[S M Mahfuzur Rahman] |
