1.0 ORGANIZATIONAL DESCRIPTION
1.1 Introduction:
The City Bank Limited is the first private sector bank in Bangladesh. It was incorporated on 14th March 1983 as a Public Limited Company under the Companies Act- 1913. The noble intention behind starting of this Bank was to bring about a qualitative change in the sphere of banking and financial management. It got Certificate of Commencement of Business on 3rd March 1983 and formally started banking operation from 27th March 1983 through Bangabandhu Avenue Branch at Gulistan building. Now the Bank serves its customers at home and abroad with 76 branches and about 300 overseas connections. The services encompass wide diversified areas of trade, commerce and Industry, tailored to the specific needs of the customers and are distinguished by an exceptional level of prompt and personal attention. Over the years, the Bank has expanded the spectrums of its services. The extensive and ever growing domestic network provides and carries various products and services to the doorsteps of millions.
Version of an image of a credit card
Chinese Bank of China
BankThe City Bank Limited has already introduced some new Banking Products like Credit Card, ATM, and SWIFT etc, which created attraction among the clients. The Bank is going to introduce Real Time On-line Integrated Banking System with all modern delivery channels. The Bank?s services have always received appreciation for the warmth and hospitality and have a set of landmark of achievement at home and abroad. The authorized capital of the bank is Taka. 400,00,00,000 as on end-December 2002. The paid up capital of the bank stood at Taka. 240, 000,000 as on end-December 2002.
1.2 Company's Vision:
To become the leading commercial bank in the country and contribute maximum to the welfare of the people of the country.
1.3 Company's Mission:
To enjoy the trust and confidence of the customers through cultivation of relationship banking.
1.4 Company's Objectives:
To earn customer satisfaction through diversified banking activities and introduction of innovation banking.
1.5 Company's Effort:
To achieve the above goals through fully motivated, committed and dedicated work force.
1.6 Company's Overall Performance:
Bank, as financial institution is a service-oriented organization. It provides financial services to the economy by mobilizing fund from surplus unit to deficit unit. Bank mobilizes funds by introducing various financial products. Efficient & effective fund mobilization depends on individual bank's capability of designing financial products. The City Bank Limited is also trying to design the financial product efficiently. Nevertheless, Vision may differ from the reality.
The City Bank Limited has a vision and mission to improve the financial sector of Bangladesh (i.e. economic condition of Bangladesh) by providing effective and innovative banking and financial product in financial market. Performance in the field of deposit mobilization, credit disbursement, foreign trade, remittance and earning of profit has over shadowed the performance of previous years. It is worth mentioning that, in 2002 growth in deposit mobilization is almost 15 percent, in credit disbursement 9 percent, in foreign trade almost 6 percent, in remittance business almost 5 percent and in recovery of classified loan 110 percent. It is noteworthy that among the contemporary banks only the City Bank Limited achieved more than 35 percent growth while growths of other first generation banks were negative. Positive signs were evident in all financial indices of the bank as well as in other non-financial activities. Programs like branch expansion, branch shifting, and renovation of branches along with Head office and process of construction of bank?s own building have broadened the image and frame of the bank.
Through the Authorized Capital of the bank remained unchanged at Tk. 400.00 million, the paid-up capital have increased to Tk. 240.00 million through issuing rights share at par 1:2 that means 1 right share against two ordinary shares, in the year ended 2002. As against Tk. 263.10 million in 2001, reserve fund of the bank stands at Tk. 543.80 million at the end of the year. The growth under this had is 107 percent. The capital base of the bank strengthened as a result of augmentation of Authorized Capital and Reserve Fund.
Bank has maintained 8.16 percent capital adequacy ratio on the basis of accounts for the year 2002 where as the requirement of Bangladesh Bank is 8.00 percent. The deposit of the Bank increased by Taka. 2499.30 million to an amount of Taka. 19683.30 million at the close of the year 2002 as against the deposit of Taka. 17184.00 million at the end of the previous year. Deposit growth rate of the year is 15 percent. Out of the total deposits, Taka. 1627.40 million was mobilized from public sector and Tk 18055.90 million from private sector respectively 8.27 percent from public sector and 91.73 percent from private sector. Total amount of loans and advances of the City Bank Ltd stood at Tk 13884.90 million in 2002 as against Tk 12729.20 million in 2001 with an increase of Tk 1155.70 million. Bank continued its investment on Government treasury bill, share, debenture, and prize bond. Total investment figure stood at Tk 2511.40.90 million in the year 2002 as against Tk 1977.90 million in 2001. As a result Bank has registered am addition of Tk 530.00 million in investments compared to previous year. Compare to 2001 in 2002 exchange income increased by TK 34.70 million and stood at Tk 127.20 million. The growth rate in this sector
is 38 percent. The amount of Import and Export business by the bank in said year is Tk 12262.60 million and Tk 6213.50 million respectively. The figures in the above head in previous year were Tk 13503.20 million and Tk 3982.10 million respectively. Bank earned satisfactory amount of profit in 2002 as it did in previous year. Under various head of accounts the figures of income and expenditure of the bank remained at Tk 3261.10 million and Tk 2709.90 million respectively. Therefore, Bank?s operating profit stood at Tk 551.20 million as on 31st December 2002. Mention be made that, bank earned an operating profit of Tk 407.40 million in the year 2001. Growth rate of profit earning being 35 percent.
Figure 1: Operating Profit Figure 2: Return on Equity
2.0 ASSESMENT PREPARATIONS
In assessment part, we evaluate the organization and try to realize the problem of the organization to achieve our assessment goal.
2.1 Goals of Assessment:
We, the team members set up three goals for the assessment. These are:
-Understanding how the City Bank doing their day to day organizational works.
-Identification and prioritization the problems of the existing system.
-Enrolling organizational leaders in the change process and obtaining Senior Manager Agreement.
2.2 Principles of Assessment:
To perform a good assessment, some special considerations were kept in our mind. They are:
-We used a process model as a basis of the assessment to understand the organization.
-We maintained confidentiality in times of assessment which permitted us to talk to the people at all levels of the organization.
-The senior management set the organization?s priorities. They involved with us in the assessment and follow up action plans.
-We showed an attitude of respect for the views of the people in the organization being assessed.
-At last we focused on action.
During preparation phases, senior manager became committed to the process, agreed to participate personally and committed to take action on the resulting recommendations. On site assessment period, we used several techniques and then a recommendation is presented to the managers. After this, plan is assembled and implemented.
2.3 Team Description:
To conduct an assessment, we form a team of six members. Most of us are in senior standing. Our group members are from different backgrounds. Three of us are from Computer Science Major, one of us is from MIS Major and rests two of us are from Accounting Major. As we for, our group from different majors, we can share our knowledge among us and this helped us a lot during assessment process.
2.4 Team Training and Rules:
After forming the team, all of us agreed to participate fully during the on-site observation and wrap up meetings. Members were present on time in every meeting. The training program has the following steps:
-Assessment schedule and objectives are outlined.
-Assessment principles are reviewed together with the process model which is used as the assessment framework.
-Assessment guideline is discussed.
-On-site planning is done and rule defining is completed.
2.5 Management Commitment:
During preparation phase, senior managers became committed to the process, agreed to participate personally and committed to take action on the resulting recommendations. On site assessment period, we used several techniques and then a recommendation is presented to the managers. After this, plan is assembled and implemented.
3.0 ASSESMENT TECHNIQUES
During assessment conducting period, we used the fact-finding techniques. They were,
-Documentation Research
-Observation
-Questionnaire
-Interview
3.1 Document Review:
In assessment, we first review the documents of city bank. By reviewing the documents, we got a brief idea about the organization. Some important document?s jest is listed below:
3.1.1 Organization and Management:
The City Bank Limited with its Principal-Office located at Dhaka is both functionally and geographically organized. The works at the Head-Office are organized functionally into various departments. Its banking is done by branches. It has two regional offices, one at Chittagong and other one at Khulna. It has 76 branches through out the country. The general directions and administration of City Bank is entrusted to a Board of Directors, consists of 18 members including the Chairman, Vice-Chairman, Managing Director and other fifteen directors. Managing Director is the Chief Executive Officer of the City Bank.
3.1.2 Organizational Structure:
The organizational structure of The City Bank is as follows:
3.1.3 Different Services:
To meet the increasing demand of the clients, to widen the services of the bank and to diversify the sources of deposit, the bank has launched some new services in the year 2002and the services are as follows:
3.1.3.1 Corporate Banking: Long Term Financing Products:
The City Bank Limited has a vision and mission to improve the financial sector of Bangladesh i.e. economic condition of Bangladesh by providing effective and innovative banking and financial product in financial market. However, in every economy of the world financial sector is highly regulated sector.
Project loan to any industry under the rules & regulations of Bangladesh Bank/G.O.B.
Term Loan to any Industry for import of Capital Machinery under the rules & regulations of Bangladesh Bank/G.O.B.
Equity Participation to any Financial Institutions/Companies under the rules & regulations of Bangladesh Bank/G.O.B.
Term Loan under Syndication/Consortium arrangement under the rules & regulations of Bangladesh Bank/G.O.B.
Equity Entrepreneurship Fund (EEF) to any company under the rules & regulations of Bangladesh Bank/G.O.B.
Commercial House Building Loan in urban area to any developer/individual/company under the rules & regulations of Bangladesh Bank/G.O.B.
Transport Loan to any company/individual under the rules & regulations of Bangladesh Bank/G.O.B.
Credit Line Facilities as Term Loan to any Leasing Companies under the rules & regulations of Bangladesh Bank/G.O.B.
3.1.3.2 Corporate Banking: Mid-term Financing Products:
The City Bank Limited has a vision and mission to improve the financial sector of Bangladesh (i.e. economic condition of Bangladesh by providing effective and innovative banking and financial product in financial market). However, in every countries of the world, financial sector is highly regulated sector. City Bank provides the following mid-term financing products,
Project loan to any industry under the rules & regulations of Bangladesh Bank and Government of Bangladesh.
Term Loan to any Industry for import of Capital Machinery under the rules & regulations of Bangladesh Bank and Government of Bangladesh.
Equity Participation to any Financial Institutions/Companies under the rules & regulations of Bangladesh Bank and Government of Bangladesh.
Term Loan to Syndication/Consortium arrangement under the rules & regulations of Bangladesh Bank and Government of Bangladesh.
Equity Entrepreneurship Fund (EEF) to any company under the rules & regulations of Bangladesh Bank and Government of Bangladesh.
Commercial House Building Loan in urban area to any developer/individual/company under the rules & regulations of Bangladesh Bank and Government of Bangladesh.
? Transport Loan to any company/individual under the rules & regulations of Bangladesh Bank and Government of Bangladesh.
? Credit Line Facilities as Term Loan to any Leasing Companies under the rules & regulations of Bangladesh Bank and Government of Bangladesh.
3.1.3.3 Corporate Banking: Lease Financing
Lease financing operation in the Bank has been introduced in later half of the year 2002 to diversify investment and financing in industry. Under this scheme financial support is offered for procurement of large machinery, vehicle, office equipment and purchase of flat or apartment or setting of industry.
3.1.3.4 Personal Banking: City Card
Client having CITY CARD will be able to access banking service and account information at all time from any of 50 ATMs around the city.
Features
The City Bank Limited launched their Smart Card, ATM Card, Credit Card, Debit Card & Utility bills payment Card all in a single Card in the name & style of "City Card?.
The City Card provides round the clock banking through ATMs from which customers can avail the following services:
? Cash Withdrawals
? Balance Inquiry
? Mini Statement
? Cheque Book request
? PIN charge
? Utility bills payment facilities
POS terminals at the merchant end will operate/provide service throughout the day & beyond banking hours to offer:-
? Debit Transaction
? Credit Transaction
? Account Information
? City Card loading
? On-line or off-line
3.1.3.5 Personal Banking: Three Stage savings Scheme
Features
? The size of the monthly installment is Tk 500, Tk 1000, Tk 2000, Tk 3000 and Tk 5000.
? The Deposit is for the period of 3(three), 6(six) and 9(nine) years.
? Monthly installment has to be deposited by 15th day of every month.
? One can open more than one account having different amount of installment.
? At Maturity, the benefits will be paid at the simple interest rate.
? Pre-mature encashment is allowed with slight cut in the interest rate.
? Loan facility up to 80% may be allowed after two years of opening the account.
? Standing instructions may be given to pay monthly installment from Savings/Current
? Account maintained with the Bank Branch.
? Source Tax & other duties of the Government (if any) would be realized.
3.1.3.6 Personal Banking: Monthly Benefit Scheme
To boost up the savings tendency of the people and for bridging the gap between the monthly income and expenditure of the people of the small income bracket, The City Bank Ltd. introduced the Monthly Benefit Scheme, which facilitates the depositors to get monthly benefit against his deposit.
Features
? Deposit of Tk 50,000.00 and multiples thereof are acceptable under the Scheme.
? The Deposit id for the period of 3(three), 4(four) and 5(five) years.
? Benefit shall be paid on monthly basis @ Tk 450, Tk475 and Tk 500 for the period of 3(three), 4(four) and 5(five) years respectively against Tk 50,000.00.
? First monthly benefit shall be paid after expiry of one month from the date of deposit. If any depositor intends to withdraw his deposit before maturity due to certain unavoidable circumstances, he would be allowed to do so, in the following manner.
? No benefit including interest shall be allowed for pre-mature encashment within one year
? If the account is closed after one year, benefit applicable for FDR?s will be allowed.
? Loan facility up to 80% may be allowed after two years of opening the account.
? A Savings/Current Account has to be opened (if not already opened) for depositing the monthly benefit.
? Source Tax & other duties (if any) imposed by the Government would be realized from the accounts
3.1.3.7 Personal Banking: Consume Credit Scheme
The City Bank Ltd. has introduced Consumer Credit Scheme to extend credit facility to the people of fixed income bracket to improve their standard of living. Under this scheme the bank extends its credit facilities to purchase consumer durables viz. Personal Computer, Air Conditioner/Cooler, Freezer, Television, Washing Machine, Furniture, Motor Cycle and Private Car etc.
Features:
? Permanent employees with a reasonable service length and age limit from 22 years to 55 years are eligible for the credit.
? Loan period: Motor Car- 48 months, Other Commodities- 36 months.
? Bank will be financing maximum 80% (except Motor Car) of the value of the commodities. Incase of Motor Car 50% of the value.
? Interest rate is 15%. Service Charge 1% & Risk Fund 2% of the loan amount (one time).
? Regular loan installment payers will be allowed to get back 1% of interest as bonus.
3.1.3.8 Personal Banking: Education Savings Scheme
It is a service oriented savings scheme. Monthly TK.250/-, 500/-, 1000/-, 1500/-, 2000/- & 2500/- can be deposited under this scheme for seven years. Any 25-50 years old Bangladeshi citizen of sound health is eligible for opening such account for the benefit of his/her children/dependant. Under this scheme the total amount payable at maturity is covered under insurance. The insured amount will be payable after opening the account in case of accidental death and after six months of account opening in case of death for any other reason. The beneficiary will have the options of withdrawal of payable amount at maturity either at a time or monthly installment basis.
3.1.3.9 Personal Banking: Marriage Savings Scheme
Marriage savings scheme is a social welfare oriented savings scheme. Under this scheme the total amount payable at maturity is covered under insurance like Education savings scheme.TK.250/-, 500/-, 1000/-, 1500/-, 2000/-, & 2500/- can be deposited monthly under this scheme for twelve years.
3.1.3.10 Personal Banking: Education Credit Scheme
Education credit scheme facilities poor but brilliant students to bear their educational expenses. Every students will have the opportunity to enjoy monthly TK. 1000/- or TK. 1500/- as credit facility for 4(four) years. Repayment period of loan is 4 years with 1-year grace period. The interest rate for this scheme is 12 percent.
3.1.3.11 Personal Banking: Multipurpose Loan Scheme
Multipurpose loan scheme has been designed to extend credit facilities to meet educational (Admission & Examination fee), Medical & Tourism expenses to build the image of the Bank. Any eligible Bangladeshi of 22-55 years old can apply for a maximum of TK.50, 000 /- for 12 months or 24 months.
3.1.4 Problem related documents:
3.1.4.1 Different types of loan:
All kinds of loan are categorized in four divisions. They are:
a) Continuous loan.
b) Demand loan.
c) Fixed term loan.
d) Short term Agriculture or Macro Credit.
3.1.4.2 Basis of loan Classification:
These classifications are based on two bases. They are:
a) Objective criteria. (These are basically overdue basis)
b) Qualitative Judgment.
3.1.5 Summary of Record Review:
As we are interested to about the loan collection system of City Bank, so we gave importance in reviewing loan application form, loan approval processing form, loan approval procedure?s narrative and pictorial description, type of workflow and dataflow of loan department etc. Though the management level people were committed to help us, but the executives of loan department didn?t cooperate us that much and they were unwilling to show us problem related documents in details. So, we didn?t pressure them. We overcome this by interviewing them properly.
3.2 Observation:
Observation is one of the most effective data collection techniques for obtaining an understanding of the system. During observation phase we perform the following activity:
a) We determine that what, where, when and how we will observe.
b) Obtain permission from appropriate managers.
c) Inform those who will be observed of the purpose of observation.
b) We take notes during or immediately following the observation.
e) Review observation notes with appropriate individuals.
In times of observation we don?t interrupt the individuals at work, focus heavily on trivial activity.
It is a time consuming procedure to observe all the people or user who are using the system and the type of their workflow. Our team visited just one time to their Gulshan branch and observed all sections where most of the loan activities take place.
3.3 Questionnaire:
Questionnaire is a special purpose document that allows us to collect information and opinions from respondents. It allows us to collect facts form a large number of people while maintaining uniform responses. When we prepare question we use both format that means we asked both free format and fixed format questions.
Because of the time constraint, we didn?t get much more time to design a questionnaires format.
3.4 Interview:
This is the most common method that is used to understand a system and gather fact about the procedures. This provides us the opportunity to collect information from individuals face to face. Interview can be conducted both in structured and unstructured way. When we conducted interview of the employees of loan support department, we emphasized on unstructured interview.
To conduct an interview, we followed the following steps:
a) We selected the interviewees.
b) We prepared ourselves for the interview.
c) And then we conducted the interview.
Because of the time constraints, it is not possible to interview all the employees of loan Department of City Bank. We interviewed only the manager of Gulshan branch and one executive of loan section of who deals most of the jobs of loan related activities of Gulshan branch. For the interview, we took appointment with the manager of and the executive of loan section and interviewed them in due time. We had arranged one interview with the manager and two interviews with the executive of loan section. We took notes from the responses. After review the responses, we went back to the bank for the second interview and asked questions. After conducting the second interview, we got a clear view of the loan system workflow.
To obtain facts about the loan system of city bank we use a sample interview guide which represents an agenda. One of the interview agenda is:
INTERVIEW AGENDA
INTERWIEWEE: Abbas Uddin Ahmed, Manager.
DATE: Tuesday, October 26, 2004
TIME: 12.30 P.M.
PLACE: Gulshan-2 branch.
SUBJECT: Loan Department.
1-3 min. Open the interview.
Introduced ourselves.
Thank Mr. Ahmed for the uses of his valuable time.
State the purpose of the interview?to obtain an understanding of
the existing loan system.
5 min. What are the requirements for a customer to apply for a loan?
10 min. what are the steps that followed to sanction a loan after receiving all documents from the client?
2 min Who are the individuals that perform task in the work flow of process?
3 min. May we have permission to talk to those individuals to learn specifically and how they perform their task in the loan support department?
If yes:
When would be the appointment time to meet with each of them?
1 min Conclude the interview:
Thanks Mr. Ahmed for his cooperation.
4.0 GENERAL DESCRIPTION OF THE PROBLEMATIC SYSTEM:
Management of assets particularly the loan portfolio is the most vital function of the bank. Bank performance in terms of return to investments ultimately centered on how well a bank distributes its risk in its portfolios. Every bank has the separate credit department which deals in sanctioning, disbursements, monitoring and recovery of loans of various types.
When a client wants some loan from city bank, client won?t get the loan instantly. He/she must have an account in City Bank of at least six months old. If the client has such account, then he can apply for a loan and then depending on the criteria of loan, bank performs its verification. After verification, a proposal is made and sent it to the head office from the branch office. Then Head Office checks whether the client took loan from any other branches of City Bank and whether the client is money defaulter or not. After this checking, Head Office sends the proposal to Bangladesh Bank for checking whether the client took loan from any other bank and whether the client is money defaulter in any other bank. After verification the request of City Bank, Bangladesh Bank sends a report to the Head Office. Verification process in Bangladesh Bank takes more than one month. After receiving the report from Bangladesh Bank, Head office sends the report to Branch office. If every verification remains in favor of the client, then City Bank is ready to give loan to the client. So, we see that loan sanction process is a clumsy and very time consuming process.
It is vital for the bank management is to monitor and supervise of existing loan as well as to give emphasis on the credit disbursement and by appropriate execute of this thing banks can overcome the loan default which is very common scenario in context of Bangladesh. In context of Bangladesh perspective the main reasons behind the loan default are political interference, management lobbing, non professional handling of credit disbursement and high interest rate. Bangladesh Bank?s effort to set the things on right track has met with limited success. The international standard of bank supervision needs to be introduced in phase by allowing adequate time to adjust. All concerned should visualize that financial health of the banks should be kept intact through proper classification and provisioning.
The City Bank Limited also facing the problem of loan default and that is why the bank has been facing difficulty in generating profit. The loan division of the City Bank Limited has rectified the reason behind the problem and they think that due to political interference, lobbing in management, non-professional handling of credit disbursement, and high interest rate the problem of loan default is increasing.
For approving a loan a client have to wait for two month before bank perform its investigation and Therefore, if the situation is going in that way, the future of that bank existence will be under threat.
5.0 LIST OF PERCEIVED PROBLEM
? Loan procedure is a very complex process. It took near about two month.
? Corruption and influence by other within the system playing an important role in loan management system.
? Number of Loan defaulter increase because of the loan procedure weakness.
? Day by day city bank loosing their client because of unusual harassment.
? Because of the collaboration with Bangladesh bank the whole procedure become mismatch and time consuming.
6.0 DESCRIPTION OF THE SELECTED PROBLEM:
6.1 Narrative Description
1. A client wants to take loan from City Bank, so he/she enters into one of the branches of City Bank.
2. The client submits query to Loan Support Department for loan.
3. The Loan Support Department officials checks whether the client has a bank account in this bank or not.
4. If the client has an account in one of branches of City Bank, then he/she needs to go to step 6.
If the client has no account in one of branches of City Bank, then he/she is requested to open an account and he/she is sent to Account Opening Department.
5. If the client agrees to open an account and then opens an account, he/she has to wait for loan sanctioning procedure for six more months.
If the client doesn?t agree to open an account, then the procedure goes to step 25.
6. The Loan Support Department informs the client about various loan schemes.
7. The client chooses one of the loan schemes.
8. After choosing the loan scheme, the client fills up the application and provides necessary documents.
9. After receiving the client application form and other necessary documents, the Loan Support Department collect, sort and modify application form.
10. Loan Support Department of the Branch Office prepares a proposal and sends it to the Head Office for verification.
11. Loan Support Department of Head office checks whether the client has already taken loan from any of branches of City bank by the help of Branch Office Server.
12. If the client has already taken loan from any other banks of City Bank, then Loan Support Department of Head office again checks whether the client performance is good or not.
If the client hasn?t take loan from any other banks of City Bank, then the process goes to step 15.
13. If the client performance is good, then the process goes to step 15.
14. If the client performance is bad, then the process goes to step 18.
15. If the client has already taken loan from City Bank and performance is good, Loan Support Department of Head Office prepares a proposal for Bangladesh Bank and sends it to Bangladesh Bank for further verification.
If the client has already taken loan from City Bank and performance is bad, then the process goes to step 18.
16. Bangladesh Bank checks whether the client is a loan defaulter to any other bank or not.
17. If the client is a loan defaulter to any other bank, then the process goes to step 18.
If the client isn?t a loan defaulter, then the process goes to step 21.
18. Loan Support Department of Head Office prepares a loan denying paper and sends it to branch office.
19. Loan Support Department of Branch Office receives the loan denying paper and sends it to client.
20. Client receives the loan denying proposal and the process goes to step 25.
21. Loan Support Department of Head Office prepares a loan accepting paper and sends it to Branch Office.
22. Loan Support Department of Branch Office receives the loan accepting paper and verifies whether the client submitted documents are all right or not.
23. If the client submitted documents are all right, then Loan Support Department of Branch Office prepares a proposal in favor of the client, sanctions loan and sends the proposal to the client. The process goes to step 24.
Again, the Branch Office sends the proposal of the client to Head Office. Head Office saves the client information into the Head Office Server.
24. The client accepts it and gets the loan. So, the whole process ends in favor of the client.
25. The client is refused and he/she leaves the bank.
6.2 As Is Process
7.0 RATIONAL
The problem that the City Bank Limited is currently facing off is a serious problem for the existence of the bank in the future because it will directly impact the overall profit of the bank. Other problems are listed below-
? Liabilities will be increased.
? Problem in generating profit.
? Have to kept more provision for the next year
8.0 SYMPTOMS
Symptoms can be enlisted as below,
? In the year 2003, the amount of classified loan was increased twice in comparison of the previous year
? Dissatisfaction from the Strategic level people
? Liabilities were increased.
9.0 SCOPE
After working and analyzing, we have identified the following scopes,
? Human Resource
? Management of Bangladesh Bank
? Time Required for Verification of the submitted documents by the client
? Money
9.1 Human Resource:
For a particular branch of City Bank, there are only two to three persons in loan section. It is very difficult for them to handle all types loan related job very efficiently.
9.2 Management of Bangladesh bank:
In loan verification process, the loan proposal of every client goes to Bangladesh Bank to verify whether the client took loan from any other bank and the client is a money defaulter to any other bank. To perform such activities, Bangladesh Bank took more than one month. The reason of taking so much time by Bangladesh Bank is the poor management of Bangladesh Bank.
9.3 Time Required for Verification of the submitted documents by the client:
Before sanctioning loan to the client, City Bank verifies the submitted documents for a particular scheme which requires time. (By the client)
9.4 Money:
To make the loan support system faster, City Bank requires recruiting more employees. To do so, City Bank needs additional money and strategic level management doesn?t want to spend additional money.
10.0 DOMAIN
Domain of the problem identified by us is as follows,
? Loan Support Department of City Bank.
? Loan Verification department of City Bank.
10.1 Loan Support Department of City Bank:
Loan Support Department interacts with the clients, collects loan applications, process and made loan proposal etc.
10.2 Loan Verification Department of City Bank:
Loan Verification Department verifies the submitted documents for a particular scheme. (by the client)
11.0 INTERFACE
While identifying the interface of the problem, we find the followings,
? Board of Directors.
? Bangladesh Bank.
11.1 Board of directors:
Board of Directors of City Bank sometimes interrupts the loan support system Sometime time they give some useful advice if any case
11.2 Bangladesh Bank:
Bangladesh Bank verifies the status (related to loan) of the client with other banks (as per the request of City Bank) and to perform such activity the client needs to fill up some forms provided by Bangladesh Bank and send it to Bangladesh Bank.
12.0 PROBLEM STATEMENT
City Bank wants to deliver loan within 15 days, BUT currently it requires more than 2 months.
First of all, the workflow of loan support department will be observed in details.
13.0 PROBLEM CAUSALITIES
14.0 HYPOTHESIS GENERALIZATION:
14.1 Narrative TO-BE Process:
1. A client wants to take loan from City Bank, so he/she enters into one of the branches of City Bank.
2. The client submits query to Loan Support Department for loan.
3. The Loan Support Department officials checks whether the client has a bank account in one of branches of City Bank or not.
4. If the client has an account in one of branches of City Bank, then he/she needs to go to step 6.
If the client has no account in one of branches of City Bank, then he/she is requested to open an account and he/she is sent to Account Opening Department.
5. If the client agrees to open an account and then opens an account, he/she has to wait for loan sanctioning procedure for six more months.
If the client doesn?t agree to open an account, then the procedure goes to step 22.
6. The Loan Support Department informs the client about various loan schemes.
7. The client chooses one of the loan schemes.
8. After choosing the loan scheme, the client fills up the application and provides necessary documents.
9. After receiving the client application form and other necessary documents, the Loan Support Department of Branch Office collects sorts and modifies application form.
10. Loan Support Department of Branch Office checks whether the client has already taken loan from any of branches of City bank by the help of Branch Office Server and Head office Server.
11. If the client has already taken loan from any other banks of City Bank, then Loan Support Department of Branch Office again checks whether the client performance is good or not.
If the client hasn?t take loan from any other banks of City Bank, then the process goes to step 14.
12. If the client performance is good, then the process goes to step 14.
13. If the client performance is bad, then the process goes to step 18.
14. If the client has already taken loan from City Bank and performance is good, Loan Support Department of Branch Office prepares a proposal for Bangladesh Bank and sends it to Bangladesh Bank for further verification.
If the client has already taken loan from City Bank and performance is bad, then the process goes to step 17.
15. Bangladesh Bank checks whether the client is a loan defaulter to any other bank or not.
16. If the client is a loan defaulter to any other bank, then the process goes to step 17.
If the client isn?t a loan defaulter, then the process goes to step 19.
17. Loan Support Department of Branch Office receives a negative message from Bangladesh Bank and prepares a loan denying paper and sends it to client.
18. Client receives the loan denying proposal and the process goes to step 22.
19. Loan Support Department of Branch Office receives a negative message from Bangladesh Bank and prepares a loan accepting paper and verifies whether the client submitted documents are all right or not.
20. If the client submitted documents are all right, then Loan Support Department of Branch Office prepares a proposal in favor of the client, sanctions loan and sends the proposal to the client. The process goes to step 21.
Again, the Branch Office sends the proposal of the client to Head Office. Head Office saves the client information into the Head Office Server.
21. The client accepts it and gets the loan. So, the whole process ends in favor of the client.
22. The client is refused and he/she leaves the bank.
14.2 TO-BE Process:
15.0 ALTERNATIVE SOLUTION:
We have developed a solution which is centralized database system for all the branches of City Bank for identifying a client as a loan defaulter within a shorter period of time.
The alternative solutions for this problem can be as follows ?
1. The organization can increase the number of employees in the Loan Support and Verification Department in order to identify a client whether a client is a loan defaulter or not.
2. The organization can make a request to Bangladesh bank to perform their verification within a shorter period of time.
3. The branches of City Bank can increase the internal communication among them.
16.0 FEASIBILITY STUDY:
To choose the correct solution for Loan Support Department of City Bank, we consider some organizational, economical, technical and operational aspects which are generally called the feasibility study.
A feasibility study is a preliminary study to investigate the information needs of prospective end users and the objectives, constraints, basic resource requirements, costs, benefits and feasibility of a proposed project. The goal of feasibility study is to evaluate alternative systems and to propose the most feasible and desirable systems for development.
? Organizational Feasibility: In this part it is determined how well a proposed information system supports the objectives of the organization?s strategic plan for information systems.
? Economic feasibility: In this part it is determined whether expected cost savings, increased revenue increased profits, reductions in required investment, and other benefits exceeds the costs of developing and operating a proposed system.
? Technical feasibility: In this part it is determined whether reliable hardware and software capable of meeting the needs of a proposed system can be acquired or developed by the organization in the required time.
? Operational feasibility: This part studies whether the management, employees, customers and suppliers have the ability and willingness to operate, use and support the proposed system.
Discarding the non feasible solutions:
? Design a Centralized Database System for Loan Support Department so that if a branch wants to know about a client or do an inquiry for identifying whether a client is a defaulter or not, The loan support department will get all info within a minute from any of the branches of City Bank by the help of Centralized Database System. (Solution)
If the City Bank implements a Centralized Database System for Loan Support Department, the processing speed of loan sanction process will increase. Clients can be able to get their desire loan within a shorter period of time which will satisfy clients. The mission of City bank is to satisfy the Clients, so that the solution is organizational feasible. Because of the customer satisfaction City Bank gets the opportunity to acquire banking market. This will be beneficial for the City Bank. In today?s perspective, it will be economically affordable for the bank to design and implement a Centralized Database System. Because of the availability of technology and technical people in the market, City Bank can be able to implement the system. If the Centralized Database System is implemented, the operational level people will get more flexibility in their working field.
So this solution satisfies all Organizational, Economical, Technical, and Operational feasibility.
? Increase the number of employees in the Loan Support and Verification Department(Alternate solutionl.1)
One of the major goals of city bank is to hire the skilled local human resources. If the organization employed more employees, then it will be organizational feasible because it match with the organizational goal. At least five employees work on Loan support Department of each branch. So it is not affordable or beneficial for the city bank to hire more employees in Loan Support and Verification Department. If the numbers of employees are increased, then the Bank can?t be able to accommodate the space for the new employees and the existing employees might loose their flow of work as some of the existing employees might feel relaxed in performing their required activities. Again, job reschedule is mandatory and this is a complex process.
For the above reasons, this solution failed to satisfy technical, economical and also operational feasibility.
? The City Bank can make a request to Bangladesh Bank to perform their verification within a shorter period of time. (Alternate solutionl.2)
City Bank is one of the leading banks in private banking sector. So the bank can make a request to Bangladesh Bank to perform their verification within a shorter time. But it doesn?t match with the Bank?s goal/mission, so it will not be organizational feasible. Also City Bank neither financially able to do it nor they are not able to help them technically. But it can increase the amount of loan taker that means it will be beneficial for City Bank. If Bangladesh Bank wants to do that it will not help City Bank operationally and technically.
For the above reasons, this solution failed to satisfy Organizational and Operational feasibility.
? The City Bank Branches can increase the internal communication among them. (Alternate solutionl.3)
Without the automation of the system, City Bank can speed up the internal communication that will not conflict with the organizational mission, rule and goal etc. That means through the proper use of current skilled employees City Bank can verify the loan related docs within a shorter period of time. For this they can give more incentive or bonus which will be beneficial for the City Bank but Organization may not have afford to do that, that means organization does not want to spend extra money. By speeding up of the process, the people who are working may loose their flow of work so the operational level people will face some sort of difficulty.
So the solution failed to satisfy the Operational, Technical and Economical feasibility.
Summary of the feasibility study:
SOLUTIONS Organizational Feasibility Economical Feasibility Technical Feasibility Operational Feasibility
Main Solution ? ? ? ?
Alternative1 ? X X X
Alternative2 X ? ? X
Alternative2 ? X X X
17.0 REQUIREMENT ANALYSIS:
17.1 Functional Requirement:
1. Provide Loan Related Information to Client.
2. Checking whether the Client has an account with the bank.
3. Acquisition of the Client provided information and documents by bank.
4. Checking whether the Client has taken any other loan from this bank or not.
5. Checking the Client performance with the bank if he/she has already taken loan from this bank.
6. Checking whether the Client has taken any other loan from any other bank or not. This checking job is performed by Bangladesh Bank.
7. Checking the Client performance with other bank(s) if he/she has taken loan from other bank(s).
8. Check the validity and accountability of Client submitted documents.
9. Preparation of loan sanction or denying papers.
10. Submitting the loan sanctioning papers to the Head Office of Bangladesh Bank.
11. Handover the loan sanctioning or denying papers to the Client.
12. Handover approved loan money to Client.
17.2 Performance Requirement:
1. Processing Speed:
If the client has already taken loan from this bank, then client?s performance and money defaulting status will be checked within 3 minutes by utilizing Central Database Server System.
2. Availability:
The entire loan support department related information, client information; client status information will be available within all the branches of City Bank. Any authorized loan support department executive can be able access these information within the banking hour. All the updates in central database will be real time.
3. Reliability:
The entire loan support department related information, client information; client status information will be store in Branch and Central Database. When any job needs to be performed, then accessibility to information will be pretty easy. The executive(s) will just need to give some query to access the information and any kind of report generation will be real time.
4. Expandability:
All the branches of City Bank will be under one central database. So, any query related to loan support will real time. If Bangladesh Bank and other banks are willing to do make a central database, then City Bank can be able to expand the system with the Bangladesh Bank Central Database system very easily.
17.3 Usability Requirement:
1. In times of designing the system, organizational vocabulary of the City Bank is used.
2. The proposed system is one of the replacement of the existing standard beside this it also added some additional standards which will be user friendly for the executives of City Bank.
3. In every phase of operation, proper feedback is given to the user so that user will not become confused.
4. If any illegal operation is performed, error message or necessary information is provided to the users.
5. All the right information in provided in the right place so that user can locate it easily.
6. In the design phase, the consistency of the user work is maintained.
7. The design of the system is done in such a way, so that the users need not to memorize/remember so many steps. One of the mottos of the design was to minimize the use of user memory.
8. User will get meaningful messages in every step of action.
18.0 LOGICAL DESIGNS:
Logical system design involves developing general specifications for how the basic information system activities of input, processing, outputs, storage and control can meet end user requirements. In the system design stage, the logical design concepts are refined and finalized.
18.1 Inputs requirements:
Inputs of the system will come from the following two entities,
? Clients: Clients of City Bank provides the Account Number in the City Bank. By this account number the executives collect the client?s personal information, account status, already taken loan status from the City Bank and other banks.
? Executives of the Loan Support Department: The executives of the bank give query in providing different services to Clients. They also give query in performing their internal works such as generating different reports regarding clients, trend of sanctioned loan, trend of money defaulter etc.
18.2 Output requirements:
The outputs of the system will be client?s accounts status, client?s accounts validity, client?s already taken loan status with the City Bank and other banks (if any), loan proposal, sanctioned loan etc.
18.3 Processing requirements:
1. Client?s account validity and status checking process (Checking whether the applicant for the loan has an account with the City Bank which is more than six months old or not).
2. Filled up Loan application by the applicant (Checking whether the applicant has filled up the all the fields of the form properly and relevantly or not).
3. Verifying all the loan applicant submitted documents properly.
4. Identifying whether the applicant is a loan defaulter with City Bank or other banks or not (Identification process of an applicant as a loan defaulter with the City Bank is performed by Centralized Database System of City Bank and with any other banks is performed by the help of Bangladesh Bank).
18.4 Storage requirements:
The database will store filled up form?s information (temporarily for further verification), file number of applicant submitted documents (The documents against which the applicant wants loan), loan proposal Information (Temporarily), sanctioned loan information.
18.5 Control requirements:
To access into the centralized database system, there is a control mechanism for each level users. To log-in into the system, each user needs to submit their username and password and by the username and password, the system recognizes the access level of the user. If the user inserted wrong or invalid username or password three times consecutively, then the system will lock his/her access temporarily and to get back his/her access, the user needs to meet with the system administrator about his problem.
Each user of the system won?t get same level of access into the system. i.e. The customer relation officer will only get the access of checking a client?s accounts information. Again, the executive officer of the loan support department will get some additional access into the system such as loan verification process, loan sanction process etc.
19.0 USER INTERFACE:
The task-centered design process is basically a design technique which performs a task by an interface. In this process, one task is performed by one interface (usually the user interface).
The steps in the task-centered design process are as follows ?
1. Identify and Describe user role.
a) Role Name
b) Job description.
2. Identify major task for each role.
a) List of task.
3. Select representative task.
a) Task description.
b) Graphics User Interface.
4. Evaluation of User Interface.
By following the graphic design principle, doing a cognitive walkthrough and also following the Nelson?s heuristic analysis, we build the user interface of the City Bank loan support department as a task-centered design.
19.1 The user role of Loan support Department:
1. Customer Relation Officer of the loan division:
Customer Relation Officer provides loan scheme paper, acknowledges client?s account number (if the client already has an account with the City Bank which is more than six months old), performs the verification whether the client has really an account with the bank and if the client account number is valid and the client is agreed with one of the loan schemes, then he provides a loan application form to the client to fill it up and submit it to the Executive Officer for further verification.
2. Executive Officer of the loan division:
After filling up the loan application form, the client submits it to Executive Officer. Then the Executive Officer checks the client?s already taken loan?s status (if the client has taken any other loan from the City Bank) and the performance.
If the client performance with the City Bank is satisfied, then he prepares a paper for Bangladesh Bank requesting for the verification of the client?s already taken loan status with any other banks (if any).
He also store the client submitted papers in the cabinet by giving a tag number.
He also receives the acknowledgement of Bangladesh Bank of his request.
If the acknowledgement of Bangladesh Bank is positive in respect of the client, then he also asks the client to submit necessary documents in favor of the loan and receives these documents from the client. Then he sends these documents to the Verification Officer.
Executive Officer also receives the feedback from verification Officer after verifying the client submitted documents.
3. Verification Officer of the loan division:
Verification Officer of the Loan Support Department receives the customer submitted documents from the Executive Officer, performs the verification and sends the feedback to the Executive Officer.
19.2 The screen flow and the list of action by the users:
How the users will view the system and the sequential screen flow have discussed below:
19.2.1 List of actions taken by the Customer Relation Officer:
1. The Customer Relation Officer logs-in into the City Bank? Loan Support Department Database by entering his/her name and password.
Fig: Login Screen
2. If the Customer Relationship Officer inserts wrong or invalid user name or password then the following message box will appear:
Fig: Feedback Message
3. After opening the master form of loan support Department?s Database, the Customer Relation Officer opens the Accounts Information -> Accounts Verification Form or use the short cut command Ctrl+B:
Fig: Main Screen
4. In the Accounts Verification Form, the Customer Relation Officer verifies the client?s account validity by using client account number:
Fig: Accounts Verification Form
5. When the Customer Relation Officer submits the form for accounts verification, then the user will get an instant message as a feedback for ensuring the submission of the form information:
Fig: Confirmation Message
6. The output of the verification shows the details information of the client?s account:
Fig: Accounts Information
7. Then the Customer Relation Officer logs out from the system and tells the client to fill up the loan application form and then consult with Executive Officer.
Fig: Log out
8. After selecting the log out option the customer relation officer will get an alert message:
Fig: Alert Message.
19.4.2 List of actions taken by the Executive officer:
Task One: Loan Application saving steps.
1. The Executive Officer logs-in into the City Bank? Loan Support Department Database by entering his/her name and password.
Fig: Login Screen
2. If the Executive Officer inserts wrong or invalid user name or password then the following message box will appear:
Fig: Feedback Message
3. After opening the master form of the Loan Support Department?s Database, the Executive Officer opens the LoanInformation -> LoanApplication or use the short cut command Ctrl+A to fill up the temporary information of the applicant:
Fig: Main Screen
4. In the Loan Application Form, the Executive Officer fills up the client?s submitted application and then save the client?s information:
Fig: Loan Application Form
5. When the Executive Officer saves the form, then he will get an instant message as a feedback for ensuring that the information is saved:
Fig: Confirmation Message
Task two: Loan Verification Steps
1. Another task that is performed by the Executive officer is Loan Verification. For that from the master form of the Loan Support Department?s Database, the Executive Officer opens the LoanInformation -> LoanVerification or use the short cut command Ctrl+V:
Fig: Main Screen
2. In the Loan Verification Form, the Executive Officer fills up the applicant?s identity, account number and name and then he sends it to the head office for verification:
Fig: Loan Verification Form
3. When the Executive officer fill up the form and submit it to inquiry to the head office then he will get an assuring message his query is been sent.
Fig: Confirmation Message
Task three: Loan Proposal Steps
1. After receiving the report (about the Applicant) from head office and Bangladesh Bank the Executive Officer will make a proposal for that particular applicant. To do that from the master form of the Loan Support Department?s Database, the Executive Officer opens the LoanInformation -> LoanProposal or use the short cut command Ctrl+P:
Fig: Main Screen
2. In the Loan Proposal Form, the Executive Officer fills up the applicant?s information and the decision that is made by the Head Office and Bangladesh Bank. Then he saves it to the database:
Fig: Loan Proposal Form
3. When the Executive officer fill up the form and save it, he will get an assuring message that the message is saved.
Fig: Confirmation Message
Task four: Loan Sanction Steps
1. When the proposal is accepted by all criteria. The Executive Officer will save the sanction loan information into the database. To do that from the master form of the Loan Support Department?s Database, the Executive Officer opens the LoanInformation -> LoanSanction or use the short cut command Ctrl+S:
Fig: Main Screen
2. In the Loan Sanction Form, the Executive Officer insert some loan information that is going to sanctioned, this information include how much money is sanction, what are the condition and who is going to supervise the sanction loan .
Fig: Loan Sanction Form
3. When the Executive officer fill up the form and save it, he will get an confirm message that the message is saved.
Fig: Confirmation Message
7. Then the Executive Officer logs out from the system and send a report of sanctioned loan to the client.
Fig: Log out
8. After selecting the log out option the customer relation officer will get an alert message:
Fig: Alert Message.
20.0 IMPLEMENTATION:
20.1 Major Work to Perform:
w1) Senior Management Agreement.
w2) Recruit Skilled People.
w3) Collect data.
w4) Design the Centralized Database System by using ERD or UML etc.
w5) Decide what type of topology will be used.
w6) Decide what sort of software or hardware will use.
w7) List all necessary things that have to buy.
w8) Acquire Hardware.
w9) Acquire Software.
w10) Front-end Design.
w11) Back-end Design.
w12) Setup the central server.
w13) Established network connection.
20.2 Time Estimation Matrices:
Break Down Work Optimistic Time(O) Standard Time(S) Pessimistic Time(P) Duration
D=(O+4S+P)/6
W1) 1 2 3 2
W2) 10 12 14 12
W3) 4 5 6 5
W4) 6 8 10 8
W5) 2 3 4 3
W6) 6 8 10 8
W7) 8 11 14 11
W8) 6 7 8 7
W9) 5 10 15 10
W10) 12 15 18 15
W11) 10 18 20 17
W12) 4 8 12 8
W13) 10 12 14 12
20.3 Draw Gantt Chart:
Fig: Gantt Chart Of Work Breakdown Schedule.
20.4 Draw PERT Chart:
21.0 RISK ASSESSMENTS:
Once an organization understand the threats to its property, risk assessment is required. Risk assessment includes an assessment of the effects of a threat. If the threat occurs, how the organization will take proper action so that the losses remain low? Risk assessment answers this question.
21.1 Risk Identification:
Risk identification refers to identify the potential risks. This section identify all the risks (material or non-material), which can be the reason for the loss of the organization.
We have identify some potential risks for Centralized Database System of Loan Support Department of City bank, which are mentioned bellow ?
Security Risks:
Today?s world is heavily dependent on the technology and for that the risk of security is rising. Security violation of the system can be intentional or an accidental. Some intentional access can be unauthorized reading of data, unauthorized modification of data, unauthorized destruction of the data etc.
System Crash
As the development of the technology so many devices and software are usually used to developed a system. Beside this for a machine it is not possible to service a system lifetime. Because of this uncertainty, it is possible that our system may face some system crash. Systems are usually crash depending on two components. They are:
a) Software
b) Hardware
In the case of software, it is possible that the operating system can hang the computer, the database that is using to do operation may hang or destroyed and the central server can crash by the effects of bugs, the system can be overload, some long process that creates the deadlock, bottleneck in the dataflow etc.
And in case of hardware, it is possible that some device is being damaged, the storage media is crashed, the processor that is executing the processes can be damaged, the communication medium may be damaged and other peripherals can crash.
Network Failure
The system that is implemented in every branches of City Bank uses radio link to connect them from any branch to head office. So it is possible that the connection can lost its frequency or the ISP can have problem which can cause network failure. If the network failure is occur the executive officer of loan support department will not get the instant result of his query. This will delay the loan process.
Power Failure
Power failure is one of the major risks for the implemented system. In Bangladesh, power failure is a daily life event. When the failure of power is occur, the volatile media that mean the main memory will loss all temporary data. If the executive officer does not save all the application or the output of his query, he has to make these operations again.
Physical Security
The site or sites containing the computer systems may be face physically insecure against armed or surreptitious entry by intruders. The heart of the centralized database system where it is situated can be in an insecure state. Inside personnel can do harm to the system if the facility isn?t secured enough.
Fire
Every system needs some energy to run usually this energy is come from the electricity. So it is often possible that the system can face fire for the occurrence of short-circuit, smoking and other factors.
21.2 Risk Policy:
Anything uncertain that causes the system to fall into a problem is usually called a risk. But the system that means the Centralized Database System of the loan support department which is already implemented will face some risk in times of doing its operation. But if the risk does not cost much or the amount of damage cost low against benefits then depending on the policy (what we are going to define) we will considered a risk whether it is material or not. Risk policies help us to make decision exactly what score of risk expectancy for a particular risk will be considered as a material risk. For the system that is implemented by City Bank if the risk expectancy score exceed more then 1000 then we called it as a material risk.
21.3 Risk Quantification:
Not all risks are created equal damage. Risk quantification is the process of evaluating and determining the effect a risk. Risk quantification is denoted as RE and measure by the expression:
RE = Probability or Likelihood * Magnitude.
Likelihood can be calculated as:
No. of occurrence of an event / Number of days.
And Magnitude is:
Amount of loss per occurrence of an event
After quantifying the risks, the Quantification & materiality checking of Centralized Database System of Loan Support Department:
Risk No. of occurrence No. of days Likelihood Magnitude
Risk Expectancy Decision about the risk
Security Risks 3 300 0.01 100000 1000 Material
System Crash 2 300 0. 0067 150000 1005 Material
Power Failure 20 300 0.06 20000 1200 Material
Network Failure 3 300 0.01 100000 1000 Material
Fire 1 300 0.0033 1000000 3300 Material
Physical Security 1 300 0.0033 800000 2640 Material
21.4 Mitigation Plane:
Mitigation Plane usually helps us to reduce the probability of Risk. It generally the plane against a particular risk that help us to take appropriate action when an Identified risk occur. It is basically answering the question, how do we control any occurrence of risk? A risk mitigation program will prevent losses and reduce the cost of losses that do occur while creating a safer environment for the employees, business partners, and the communities in which the organization operate.
Risk mitigation plane or control can be done in three ways. They are:
1. Preventive (Preventive mitigation is done before the actual risk occur.)
2. Detective(Detective mitigation is done when the risk is taking place)
3. Corrective (Corrective mitigation is the way to take corrective action after the risk has occur).
The preventive, detective & corrective actions for the risks which have already been assessed are:
Security Risks
For the centralized database system for the loan support department of the city bank, there must be some kind of security measure to prevent the system from different types of attackers/hackers and different types of attacks such as Web Server Attacks, Buffer Overflows, Denial of Service (DOS) Attacks, Session Hijacking, Cryptanalysis and Brute Force Attacks etc. The preventive action of this risk is to provide password and Id number to all users. Don?t give any common password or Id to two different users. Tell the user to keep the password secret from any other person. The detective action for this security risk can be done in different way. If any user wants to access some unauthorized file then the administrator will get a signal or message. To correct the security risks that is already occurred, there must me some trained professionals to take the corrective measure.
System Crash
If the System crash is a risk then the preventive action can be to use reliable operating system, web server, web programming and database system, use SCSI hard drive as RAID volume for reliability and consistency. And also provide appropriate backup so that if a system crash occur then the backup server or backup storage can continue the work. The corrective action is that, if the system failure occurs the administrator will get an instant message and take appropriate action. To correct the system crash the city bank can employ some skilled people.
Power Failure
If the power failure of the system occurs then the preventive action of this can be to use UPS, IPS or power substation for stable and consistent power supply. If power failure is occur then the administrator of the system will get a signal or message in this moment the current state of the job will be save by all employee. If because of the power failure some data lose occur then use some data recovery tools to recover the data.
Network Failure
If network fail, the process of the workflow will be breakdown. To prevent this use some high performance network device so that at any circumstances the system network will not fall down. To take corrective action in proper time, use network link monitoring system so that appropriate action can be taken in appropriate time.
Fire
Fire is another risk that may case serious damage to the system. The preventive action for this risk can be, implement some rule such as don?t smoke at working hour etc or make some insurance for the system. The detective action can be use fire alarm system to detect the fire. The corrective action can be using some fire extinguisher to remove the fire when fire occurs.
Physical Security
To prevent the intruder or terrorist or to maintain a good security the following action can be taken: a) Install magnetic card readers to access the data center. b) Escort maintenance workers and field technicians at all times in the data center. c) Create accounts for each administrator. Monitor their user. d) Enables password-protected screensavers. e) Install a good monitoring device that alert a human in the event of excessive temperature, smoke, or humidity in the data center. f) Use close circuit camera to monitor human activities in the data center.
22.0 CONCLUSION
The existing loan process system at City Bank requires two to three months to sanction a loan to the client. By analyzing the existing loan process system we came up with a feasible solution. We suggested that the loan Support department of every branch of City Bank can developed a centralized database system with the head office to make the loan process quicker. The suggested solution has few risks involved. We studied the possible risks that can arise in the suggested solution and came up with a mitigation strategy for those material risks. The suggested loan process system will make the whole process faster. This process would enable The City Bank to reduce the long time that is required for loan sanctioning. For this great facility the mission that the City Bank has will fulfilled. They will be more beneficial.