Established in April 1995, Prime Bank Ltd has now 89 branches operating all over the country. The Prime Bank Group focuses on a wide range of banking and financial services which include commercial banking, retail & SME asset management, Islamic banking, investment banking, merchant banking and card business. A market leader in the banking sector, Prime Bank was ranked 15th in terms of market capitalization which stood at Tk.15349 million at the end of 2008 and 4th in terms of performance as per DSE-20 Index. The Prime Bank Group is the second largest banking group in Bangladesh by asset size, with total assets of Tk 110,437 million. The Bank's deposits and lending growth were 24.83 and 30.29 respectively in 2008. And its performance in 2009 is even stronger.

Mohammad Ehsanul Haque, Managing Director of Prime Bank Ltd., claims Prime Bank is one of the most successful private sector commercial banks in Bangladesh, adding Prime Bank has been having success since its birth for more than 14 years. "Prime Bank is the most profitable bank in terms of 'Return on Investment' and 'Return on Equity'.  We are sustaining a steady growth rate. The 'Non Performing Loans' of this bank is below 1.5%. This figure is much low by the industry standards." He attributes three reasons to the bank's success: the fact that the board of directors emphasize the long term prosperity of the bank; the bank's excellent customer base, who are very much pro business; the employees of the bank.  "Prime Bank has a very skilled team of human resources to serve its customers."

According to the managing director, the major challenges for the banking sector in Bangladesh in the coming years are multifold. "The organizations have to poise themselves for facing the challenges. While the global challenges did not affect our economy that much but we have to be very cautious about the future. We have to be very cautious about the opportunities of over exposure in certain sectors. The RMG and the Textile sector may be vibrant but we have to be very careful. We need to diversify our business also." At the same time he points out some major internal challenges one of which is ensuring adequate supply of energy. "Though Bangladesh is increasing its strength in the power sector but demand is also increasing. The supply is still far from catching up with the demand."  Then there is the problem of bureaucratic bottlenecks which need to be addressed with patience. Among the pressing challenges to be met in future is one that relates to environment. "This would be the gravest of problems," emphasizes Ehsan. Another big challenge is our human resources. "There is always a scarcity of resources or more precisely skilled resources. We have hundreds of fresh university graduates who are prepared to join the bank. But, if we look for people with any particular skill, then we cannot often find them. The skill set for the mid level and top management positions is scarce."  Banks sometimes need to employ fresh graduates and then train them but once the employees get trained they often switch to other banks so retaining skilled people is a big challenge in this sector.

"We have a huge population," observes Ehsan. "There are a lot of hands available but often they are not skilled at doing a particular job. We should train them in a meaningful way, which will make its effect felt in the long run." While acknowledging that the NGOs and the government have done some good work in this regard, he comments that the impact has not been significant. "More concerted efforts should be made so that those hands can be used meaningfully. We are sending unskilled or semi skilled people to other countries to work. We should first train them, and then they should go for work. That would be much more productive for our country."

According to Ehsan, Government should address two issues in the banking sector on a priority basis. One is energy and the other is developing HR. Whatever real development of HR is happening in our country is mostly happening in the private sector. So, the Government should work with the private sector on this issue.

The veteran banker expresses his sincere appreciation of the role being played by the central bank of Bangladesh. "Bangladesh Bank is doing an excellent job. Although they are in the public sector, they almost operate as if they were in the private sector. They are efficient, very cooperative; they know their job and they are good at it. They are very much pro business. They are always prepared to think out of the box."

Ehsan agrees that banks are providing more or less similar products & services and so there is some competition in consumer banking but then given that Bangladesh has a huge population with a rising income level there are still great opportunities for the banks to serve their customers with their products.

Prime Bank has already started online banking which enables its customers to check their recent account statements on the net. Facilities such as making transactions online cannot be provided at present because government has yet to make the necessary laws for the purpose.

Islamic Banking is becoming popular. Like some other private banks Prime Bank is providing Islamic banking facilities. Currently it has 5 Islamic Banking branches.

The banking sector is expanding but Ehsan does not think new banks should be formed. Rather, there should be mergers and acquisitions in this sector. Indeed the    retail banking sector is      being well served by the    local commercial banks in      Bangladesh.

Ehsan does not agree that private banks in Bangladesh are for rich people only. He argues that most of the private sector banks are giving loans to SMEs. And these loans are for middle class or lower middle class. Private Banks find it difficult to reach the rural market because of resource constraints. However, Prime Bank is planning to tie up with some NGOs to operate in rural markets; the bank will provide money to the NGOs and they will disburse loans at a lower interest rate.

As regards the bank's corporate strategy, he mentions three things:

l We do the things we are good at.

l We keep growing in our areas of core business.

l We look for prospects for expanding in areas of opportunities. Examples are; SME, Retail, Cards, Agricultural business.

Prime Bank's CSR (Corporate Social Responsibilities) activities are commendable.  Prime Bank Foundation has carried out a number of philanthropic activities such as establishing in 2007 Foundation's Education Support Program which has provided financial support to hundreds of hardship-hit meritorious students enabling them to pursue their graduation/post-graduation level studies. At Uttara, the Foundation has established Prime Campus, a high-quality, values-oriented English Medium School with many unique features. Through the Foundation's 'Drishty Daan' project Prime Bank supported the total costs of sight restoration surgeries of 671 poor/ultra poor cataract patients who could not afford to pay for the surgeries they needed. Also, the Foundation in collaboration with National Heart Foundation runs a financial support project named 'Keep the Heart Beating' for poor children with congenital heart disease.

Terming the banking sector the most vibrant sector in the economy, Prime Bank MD expects to see Prime Bank as the number one bank in Bangladesh serving more people in the country.r

ET Report