Dynamics of Market Capitalization and GDP Relationship

Gross Domestic Product or GDP is a commonly used measure of a country's economic development where market capitalization signifies the performance of stock market. N. Gregory Mankiw in his book “Principles of Macroeconomics” has defined GDP as “the market value of all final goods and services produced within a country in a given period of time”. In DSE website, Market Capitalization is stated as “the total market value, at the current stock exchange list price of the total number of equity shares issued by a company”.  It is calculated by multiplying the individual share price of a company with total number of common share outstanding of that company. For the whole market, this is simply the summation of market capitalization of all companies listed in that market.

Why Do I Think Print Media Is Dying?

“We will stop printing the New York Times sometime in the future,” these were the words of Arthur Sulzberger, Jr., Chairman of The New York Times at the 2010 International Newsroom Summit in London. His words highlight an important fact about print media that we can’t ignore. Print media industry is going through a significant shift in this decade. And, Newspaper which is a major player is print media industry is facing challenges due to this wind of change. In 2014, annual aggregate revenue of U.S. newspaper publishers has declined to 29.56 billion U.S. dollars which was 49.4 billion U.S. dollars in 2006.

Study on the Financial Management of Prime Bank Limited: Part 05

In this final part of the "Financial Management of Prime Bank Limited" blog series (Part 01, Part 02, Part 03, and Part 04), interest rate risk management and market risk management are discussed.

Interest Rate Risk Management of PBL

To understand the interest rate risk management of Prime Bank Limited Repricing/Funding Gap Model is used. Table 21 shows the repricing gaps for 2010-14 in 6 categories. Here, it can be observed that the bank has a cumulative negative repricing gap over the years representing more rate sensitive liabilities than rate sensitive assets. It interprets that rising interest rate would have negative effect on the bank’s earnings because the bank will have to source fund with higher interest rate while their earlier assets were utilized at lower interest rate. In addition, rising borrowing rate will lead the rise in lending rate which is a negative incentive to borrowing, therefore, the bank may need to economize their spread. Reverse scenario can be observed in case of decrease of interest rate.

Study on the Financial Management of Prime Bank Limited: Part 04

In this part of the "Financial Management of Prime Bank Limited" blog series (Part 01, Part 02, Part 03) the discussion is made over treasury performance, capital adequacy, liquidity gap and financing gap of PBL.

Study on the Financial Management of Prime Bank Limited: Part 03

In this part of the "Financial Management of Prime Bank Limited" blog series (Part 01, Part 02) the discussion is made over provision. A bank has to maintain provision against different types of assets according to the regulations of central bank. The percentage of provision differs based on the quality of assets. For example, bad loan has the least probability of recovery, therefore, has 100% provision requirement. Credit quality of PBL and subsequent provision are highlighted below.

Amateur Thinking About Entrepreneurship

I rarely feel the entrepreneurial fire in myself. But, that doesn’t mean I don’t support entrepreneurship. I’m a fan of this concept and deeply appreciate the contribution of the entrepreneurs in shaping our society over the centuries. One day, if I come across the Gini of Aladin’s lamp and he gives me 3 wishes, then my 1^st one would be to become an entrepreneur. So, why am I not pursuing this now?

Does the Performance of Banking Sector Affect GDP in Bangladesh?

In this blog post, I tried to study the relationship between banking sector performance and GDP growth in the context of Bangladesh. The banking sector performance is calculated by the year to year growth of banking sector (all the commercial banks) income and profit. Banking sector related data was collected from the “Monthly Economic Trend” May 2016 Issue published by Bangladesh Bank and GDP growth data was collected from the World Data Bank. 

Incomes and Expenses Scenarios of Banking Sector of Bangladesh

Other day I was checking the “Monthly Economic Trend” May 2016 Issue published by Bangladesh Bank. I found some interesting data there and thought about writing a blog about those. And, here, it is. This is basically a general discussion on the income and expenses of Banking Sector of Bangladesh.  I’ve observed that, after 2002, banking sector has experienced single digit growth in 2013 and 2014. Individually, only the State Owned Commercial Banks (SOCBs) have reported double digit growth in 2014 while Foreign Commercial Banks (FCBs) have reported negative growth. But, if we dig deep to the SOCBs, then the double digit growth doesn’t look pleasing.

Happiness Demystified

How to be happy? A question that is passing over generations. Everyone is rushing toward it and few people are seen actually getting it despite all of their desperation and sacrifices.  I, personally, find this rush for happiness a bit confusing. Should we truly reach a level or get a particular thing to be happy? Can’t we just be happy in present moment with all of the things we have now? Is it really essential for someone to cross a mystical boundary of unhappiness to be perpetually happy? When we see the people who have already reached our desired our level and find them still unhappy with life Can’t we just question ourselves what is the problem? These people should have been in the throne of happiness by now.

Financial Management of Prime Bank Limited: Part 02

In this part of the "Financial Management of Prime Bank Limited" blog series the credit-deposit section is discussed. 

Composition of Credit

Table 6 shows the credit mix of PBL for 2010-14 in percentage.  It can be observed that the major areas of fund employment are Secured overdraft / Quard against TDR, Cash credit / Murabaha, and Loans (General) holding average 24.50%, 14%, and 20.73% respectively of total credit. Over the years, Loans (General) and Credit card are showing increasing trend where Loans against trust receipt, Payment against document, Lease finance, and SME loan are decreasing

It's Your Reaction, Not the Situation

This is a story of two brothers. Their father was a drinker and tortured their mother every night. When they grew up, one boy become a photocopy of his father and others become the opposite. When a man asked the first boy why he has become like his father. He replied what do you expect!!! When the same question was asked to second boy, he said I have experienced what it felt to be one like my father and I chose not to be like him. The morale of this story is it doesn’t matter what you’ve experienced in life, the thing matter is how you interpret it. How you react to a situation? The situation may be not in your control. But your reaction is.

Financial Management of Prime Bank Limited: Part 01

This work was actually done as a part of academic requirement in my MBA program. This was a group project and I would like to acknowledge and thank my group members, Urmi Das, Nadisha Ahmed, and Jafrin Siddique for their valuable support in doing this work. We tried our best to produce a work of value and I think it will be helpful for others wanting to know about or work on bank financial management.

IPO Offering Price Determination in BD: Examples

Three Companies i.e. Dragon Sweater and Spinning Limited, Bangladesh National Insurance Company Limited, and Doreen Power Generations and Systems Limited, are joining DSE and CSE in the coming periods. Dragon Sweater and Bangladesh National Insurance are coming at the face value of Tk. 10 while Doreen Power is coming with Tk. 19 premium at Tk. 29. 

Expectations from Me in 2016!!!

Last year, I made resolutions and nothing happened after that. I had lived the way, I was used to living. Wise man says, you’ll get what you deserves, not what you want. My resolutions were my list of wants. I did nothing about those. I didn’t strive for becoming the person who deserves to have those things. So, at the end of the year, I had nothing in my basket to show up.  And, what’s interesting about this is I’m not shameful about that now. The commitments were to myself, the writings were in my personal notebook, and now, no one knows about my failures.

Thank You 2015 !!!

So, another year is going away from my life. I know life is uncertain and strongly believe, life and death are always in the Hand of Almighty. But, to my wonder, I always think about living to my 60 and, according to that expectation, standing on this day, I’ve around 36 years in hand to live in this earth. In the past 24, I’ve experienced a lot of wonderful things, was loved by a lot, and hated too. Nonetheless, I lived a happy, peaceful, and joyful life. But, what about 2016?

Performance Analysis: Ratio Analysis

For performance analysis a widely used tool is ratio analysis. It’s an age old method which represents relationship between two variables. For business organization, financial ratio represents significant relationship among different financial statement components and shows how one component is related to another. Thus, ratio helps to identify the liquidity, profitability, and operational efficiency of a firm. It also facilitates the comprehension of the financial statements and the comparative analysis among firms in the same industry.

Book Review: Rich Dad, Poor Dad

To this date, I've passed about seventeen years in formal education and all these years, I was taught to study hard, get good grade and lend in a good job for better salary and living. Our education system is designed to make us a good fit to work for money, but how much we are taught about the money itself. From the educational institutions we get tons of knowledge about the profession and almost zero about personal finance which results in many highly paid professionals living on debt and have very little for their retirement. This book tries to fill the gap of our financial intelligence and gives some ideas about how to think about money.

Book Review: Big Magic: Creative Living Beyond Fear

I got to know about this book from an interview between Marie Forleo and Elizabeth Gilbert in MarieTv on October 14 and I was pretty much curious about this book. As my birthday was on 22, I was really expecting someone to ask me about which gift I wanted and I would reply “Big Magic”. No one asked me anyway (missing the childhood!!!). But, later, I managed the book and started reading on 26 and finished by 28. The journey of reading this book was just amazing.

This book is all about creative living. How to live a life driven by your curiosity instead of fear. Liz suggests five essential ingredients for creative living i.e. courage, enchantment, permission, persistence, and trust. She discusses how she deals with these in her way of creative living and how others she knows handles these. She answers how did she keep herself moving after receiving rejection letters for years after years? How did she manage her massive success of Eat, Pray, Love? How did she see her creative process? and many more.  

Relationship: The First Visitor

First thing to clear about is I’m not a that level of thinker to give you something valuable to take with from this writing. You may just read this as an act of kindness to my effort. 

Book Review: Playing It My Way: My Autobiography

In recent years, I’ve identified my special kind of interest in knowing about the legends and few minutes earlier finished reading the book “Playing It My Way: My Autobiography” by the greatest Sachin Tendulkar. I’m not a crazy fan of Cricket but enjoy watching and heard about the legends of this area, Vib Richard, Brian Lara, and now Sachin Tendulkar. In the quest of knowing about Sachin, I just picked up this book a very while ago and took time to finish.

The feeling of reading this one was spectacular. It felt like I was going through a journey with Sachin and now, when finished with this book, its feeling sad.