L/C Procedure of Dhaka Bank PLC

Abstract

This report explores the Letter of Credit (L/C) functions of Dhaka Bank PLC, highlighting its essential role in enabling international trade by guaranteeing secure and prompt transactions between importers and exporters. The research was carried out during an internship, offering insights into the trade finance processes and operational effectiveness of the bank. Founded in 1995, Dhaka Bank is a key entity in Bangladesh's banking industry, providing a variety of financial services, including trade finance, crucial for the nation's economy, particularly its export-oriented sectors. The bank's L/C activities are regulated by international rules like UCP 600 and local compliance guidelines established by Bangladesh Bank, guaranteeing alignment with global standards. The report details the bank's complete L/C processes, which encompass issuance, advising, confirmation, and settlement. It assesses the real-world challenges encountered, like document inconsistencies, and proposes enhancements for improved efficiency, such as digitalization and employee training. The evaluation highlights Dhaka Bank's strong points in customer-focused service and technological advancement, while also pinpointing areas for improvement, like risk management and operational flexibility. The internship provided practical exposure to L/C processes, enhancing theoretical understanding and emphasizing the bank's strategic role in building trust and reducing trade risks. Suggestions involve optimizing operations through cutting-edge technology, improving customer knowledge regarding L/C documentation, and implementing proactive risk management approaches. These actions seek to enhance Dhaka Bank's standing as a trustworthy ally in trade finance.