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Chapter 9 (Nine) Accounts in brief

Accounts Division

Double entry system:banks follow double entry system in all accounting process. Each transaction must have a debit and a corresponding credit.

Classification of Accounts:

Banks maintain 4 sorts of accounts.eg

1. Income Account

2. Expenditure account

3. Asset account

4. Liability Account

Cheque & Withdrawal ( Chapter Three)

Definition of drawdown: Banking: Transfer of funds from one account to another on the instructions of an account holder.

What is called a cheque?

Cheque:

As per negotiable instruments Act-1881 Section 6, A cheque is a bill of exchange drawn on a specified banker and not expressed to be payable otherwise than on demand. ( Section 5- A bill of exchange is an instrument in writing containing an unconditional order, signed by the maker, directing a certain person to pay on demand or at a fixed determinable future time a certain sum of money only to or to the order of a certain person or to the bearer of the instrument)

Cheque vs. Bank Draft

bank draft :

A bank draft is an unconditional order issued by one branch of a bank on its another branch to pay a certain sum of money to the named person or order on demand.

Hence a bank draft is always payable on demand it is also known as demand draft (D.D)

Exchange Rate in Banks

Currency is treated as commodity.

The selling rate is the rate at which bank sells foreign currency to customer and buying rate is the rate at which bank purchases foreign currency from the customer. The difference between a bank’s buying rate and selling rate constitute its “dealing spread” or the exchange profit or exchange gain.

A promissory note is drawn and signed by the debtor, who promises to pay the creditor a certain sum of money. The specimen of promissory note is given below:

Chapter 11 ( Eleven) Statement of General Banking

Statements of General Banking

Daily statement sent to Head Office

1. Daily Position

2. IBG A/c statement

Monthly Statement:

cheque and bill of exchange

a. The exact meaning or actual wording of a document as distinct from its effect

Apparent tenor of cheques means: date of cheque, sum of cheque both word and figure, name of payee, drawer signatures

Chapter 10 (Ten) Gereral Banking Portfolio, and Clearing House

GENERAL BANKING PORTFOLIO OF IBBL : -AN OVERVIEW

Introduction:

Banking functions and activities are mainly segregated by three areas which are operation, investment & foreign exchange (international banking) at Head Office level and general banking, investment & foreign exchange at branch level.

General banking portfolio:

The areas of general banking covers most functions and activities of a branch which is treated as general banking portfolio. The areas are identified as section or department which are as follows:

Sections of general banking:

• 1. Reception and account opening

section

• 2. Cash section

• 3. Clearing and collection section

• 4. Remittance and bills section

• 5. Dispatch section

• 6. Accounts section

• 7. Reconciliation section

• 8. Others-Security, Locker service etc.

Chapter 8: Negotiable Instrument Act, 1881

The Negotiable Instrument Act: 1881 (total Section-142)

A " negotiable instrument " means a promissory note, bill of exchange or cheque payable either to

order or to bearer. ( Section13) which are transferable from hand to hand by way of negotiation but does not contain words prohibiting transfer.

Example: 1. Pay to X

2. Pay to X or order

3. Pay to X or bearer/ order

4. Pay to X only

5. An instrument crossed “Account Payee Only”

Chapter 7( Seven) Deceased Account, Banker- customer relationship, local remittance

Withdrawal of money form deceased Account: Transaction close at the news of death.

Following documents are to be submitted for withdraw by heirs:

Withdrawl by Nominee:

1 Death certificate by chairman

2 Application by nominee with two copies of attested photoes

3 Identification of nominee by Chairman/ two customers/ two officers of bank

4 Indemnity by nominee jointly with two customers of bank

(Chapter 6) Weitage and its calculation & PSR/ISR

Weightage: Meaning & Factors.

Weightage	:	Weightage means preference of one product in comparison to other product. On the other hand we can say weightage means giving the value of the specific or particular matter / subject higher or lesser than that of / in comparison to similar one.
Factors of Weightage	:

(Chapter 5) Collecting and Paying Banker

Collecting Banker: A Collecting Banker is one who undertakes to collect various types of instruments representing money in favour of his customer or his own behalf from the drawers of these instruments; some are negotiable instruments as provided for in the negotiable instruments Act. 1881 and some are quasi negotiable instruments.

(Chapter 4) Endorsement and Crossing of Negotiable Instrument

Negotiable Instrument:

The negotiable Instruments Act (1881) does not define a negotiable instrument but merely state that a “negotiable instrument means a promissory note, bill of exchange or cheque payable either to order or bearer (Section- 13)

A negotiable instrument is a transferable document that passes freely from hand to hand & forms an integral part of the modern business mechanism.

Endorsement:

Deposit & Account Opening — Chapter Two

1. DEPOSIT — DEFINITION & NATURE

Conventional Bank: Deposit is a loan taken from the public. The bank can use the money in any way it wishes. The legal relationship is:

Bank = Debtor | Depositor = Creditor

Islamic Bank: Deposit is Amanah (Trust). Accepted under two modes:

Al-Wadiah: Bank = Trustee (Amaneen) | Depositor = Trust-Giver (Moodaq). Bank safeguards the deposit and cannot use it without permission. No profit guaranteed.
Mudaraba: Bank = Mudarib (Entrepreneur/Manager) | Depositor = Sahib Al-Mal (Capital Owner). Partnership in profit; loss borne by capital owner except in case of negligence.

2. TYPES OF DEPOSITS

#	Type	Key Feature	Examples
1	Demand Deposit	Payable on demand. No fixed maturity. No cheque book issued.	Al-Wadiah Current Account, General Savings Account
2	Time Deposit	Payable on specific maturity date. No cheque book issued.	Term Deposit (FDR), Bonds, Monthly Savings Scheme
3	Call Deposit / Call Money	Short-term inter-bank borrowing. Repayable on call or notice.	Mudaraba Special Notice Account (MSNA)
4	Cost-Free Deposit	Bank pays no profit or interest on these deposits.	Current Account, Pay Order, DD Payable, Sundry Deposits
5	High Cost-Bearing Deposit	Bank pays a relatively higher rate of profit/interest.	FDR, Term Deposit, Bonds, Mudaraba Savings

🧠 Memory Hook — Deposit Types

"Don't Take Cash From Home"

Demand | Time | Call | Free-cost | High-cost

3. DAILY PRODUCT ACCOUNTS (Islamic Banks)

In Islamic banks, profit is calculated on the daily product basis (daily closing balance × number of days). The commonly cited four daily product accounts are:

Mudaraba Farmers Savings Account (MFSA)
Mudaraba Staff Account (MSA)
Mudaraba Special Notice Account (MSNA)
Mudaraba Hajj Savings Account

4. ACCOUNT OPENING — COMMON DOCUMENTS

Standard documents required for opening any bank account in Bangladesh (as per Bangladesh Bank guidelines and e-KYC framework):

Completed Account Opening Form — Bangladesh Bank standardized KYC format
Photograph: Digital photo taken on-spot via e-KYC system, OR 2 copies passport-size photographs of every operator — duly attested by the introducer (paper-based route)
Identity Proof: Smart National ID Card (primary — biometrically verified against Election Commission database via e-KYC) / Valid Passport / Birth Certificate
Nominee's Photograph: 1 copy passport-size photo of the nominee, attested by the account holder
Minimum Deposit — amount varies by account type and bank policy

📌 e-KYC UPDATE (2020–2026): Bangladesh Bank (BFIU) introduced e-KYC guidelines enabling fully digital account opening. Customer's NID is verified biometrically (fingerprint / facial recognition) directly against the Election Commission (EC) database. MBPLC has adopted e-KYC. Updated BB e-KYC guidelines effective September 2026 allow simplified digital verification for transactions up to Tk 5 lakh/month.

KYC Profile Types

Three types of KYC profiles are completed, depending on the customer category:

#	KYC Profile Type	Applicable For
1	Personal / Individual	Individual account holders
2	Firm / Company	Proprietorship, Partnership, Limited Company
3	Non-Business Organization	Clubs, Societies, NGOs, Religious bodies

5. WHO CAN OPEN AN ACCOUNT?

Any person eligible to enter a contract can open a bank account. Under the Contract Act 1872, Section 11, a person must be of the age of majority to contract. Special care must be taken for the following accounts:

5.1 Minor Account

A minor lacks contractual capacity and cannot independently open a bank account. A guardian may open an account in the minor's name or jointly with the minor.

⚖️ Majority Act 1875, Section 3 — Age of Majority:
General rule: 18 years.
Exception: If a Court of Justice has appointed a guardian for the minor's person or property, OR the minor's property is under the superintendence of a Court of Wards — then age of majority is 21 years.

✅ For standard banking purposes: Minor = person under 18 years of age.

When the minor attains majority (18 years), the bank must obtain fresh operating instructions and an updated specimen signature from the account holder.

5.2 Account in the Name of a Bankrupt Person

No account should be opened in the name of a person declared bankrupt, because money may have belonged to creditors prior to the bankruptcy declaration. Banks should verify bankruptcy/insolvency status. Governed by the Insolvency Act 1997 in Bangladesh.

5.3 Joint Account

All account holders must sign the Account Opening Form. Clear written instructions must be recorded regarding:

Instruction	Meaning
Either/Anyone to Operate	Any one of the joint holders can independently operate the account
Anyone to Close	Any one holder can close the account
Survivor to Operate	On death of one holder, the survivor may continue to operate
All to Sign	All holders must sign jointly for every transaction
Anyone or Survivor	Any one can operate during lifetime; survivor continues on death

5.4 Proprietorship Account

The account signatory must sign the Account Opening Form with their seal and position/title in the firm (e.g., "Proprietor — XYZ Enterprise"). Trade License is required.

5.5 Partnership Account

A partnership firm has no independent legal entity — the partners themselves are the legal persons and act as representatives of the firm. The mandate/authority given to the bank becomes void upon:

Death, retirement, or insolvency of any partner
Addition or removal of any partner (change in constitution of the firm)
Expiry of the partnership term as specified in the Partnership Deed

The bank must stop all transactions on the account until fresh mandate is received from the reconstituted partnership. Required documents: Partnership Deed, Board/Partner Resolution, Trade License.

5.6 Limited Company Account

A limited company has an independent legal entity — separate from its shareholders and directors. Additional documents required:

Memorandum of Association (MOA)
Articles of Association (AOA)
Board of Directors' Resolution — authorizing account opening and designating signatories
Certificate of Incorporation
Certificate of Commencement of Business (for Public Limited Companies)
List of Directors with photographs and NID copies

⚖️ Governing Law: Companies Act 1994 (replaced the Companies Act 1913). All limited companies in Bangladesh are currently registered under the Companies Act 1994.

5.7 Accounts of Non-Business Organizations

Clubs, societies, and religious organizations may be registered under:

Companies Act 1994 (Section 28 — not-for-profit company) — treated as a company
Societies Registration Act 1860 — for literary, scientific, or charitable bodies — treated as a society/organization

Such organizations are not legally required to register under any act to open a bank account. However, banks must exercise due care. Required documents: Resolution of the governing committee, Constitution/Bye-Laws or Articles of Association, Registration Certificate (if applicable). The authorized operator must sign with their designation.

5.8 Account of Cooperative Society

The society must be registered under the current cooperative law in Bangladesh.

⚖️ Current Governing Law: Cooperative Societies Act 2001 (Samabaya Samiti Ain 2001), as amended in 2002 and 2013.

Legislative history (important for exam):
Bengal Cooperative Societies Act 1940 → repealed 31 Dec 1984
→ Cooperative Societies Ordinance 1984 → replaced 15 Jul 2001
→ Cooperative Societies Act 2001 (current) → amended 2002 & 2013

Required documents: Registration Certificate under Cooperative Societies Act 2001, Constitution/Bye-Laws, Resolution of Managing Committee. Account operator must sign citing their designation in the society.

5.9 Trust Account

Governed by the Trusts Act 1882. Required document: Trust Deed — specifying the duties, responsibilities, and powers of the trustees.

Combined signatures of all trustees are required unless the Trust Deed specifically authorizes otherwise. If a trustee dies, the remaining trustees may operate the account — provided no contrary instruction is written in the Trust Deed.

5.10 Illiterate Account

Special rules apply for account holders who cannot read or write:

Only Savings Account — no Current Account or other types
Proper introduction required at account opening
"Illiterate Account" or "SS" (Special Signature) inscribed on the Signature/Specimen Card
No cheque book to be issued
Withdrawals by thumb impression on an open/bearer cheque — executed before a bank official
Photo of account holder affixed to Account Opening Form and Specimen Signature Card

5.11 Accounts of Executors, Administrators & Power of Attorney Holders

An executor or attorney acts within the power granted by will, court order, or Power of Attorney document. Must sign with "PP" (Per Procuration / by Power of Attorney) alongside their name. The bank must verify the scope and limits of the authority granted — the agent/executor cannot exceed the powers conferred.

6. KEY LEGAL REFERENCES — QUICK TABLE

Law / Reference	Subject	Key Point
Majority Act 1875, S.3	Age of majority	18 years (general); 21 years only if Court Guardian appointed
Contract Act 1872, S.11	Contractual capacity	Must be of majority age (18 yrs) to enter a contract
Companies Act 1994	Limited company & non-profit company	Current law — replaced Companies Act 1913
Cooperative Societies Act 2001	Cooperative society registration	Current law — replaced 1984 Ordinance; amended 2002 & 2013
Societies Registration Act 1860	Charitable/literary societies	Still in force for eligible bodies
Trusts Act 1882	Trust account governance	Still in force; Trust Deed controls all operations
Insolvency Act 1997	Bankrupt persons	No account in name of declared bankrupt
BFIU e-KYC Guidelines	Digital account opening	Biometric NID verification via EC database; updated guidelines effective Sep 2026

7. MNEMONIC & QUICK RECALL

🧠 Special Account Types — 7 to Remember

"My Joyful Life Perfectly Improves Through Training"

🧠 Cooperative Law — Legislative Chain

1940 → 1984 → 2001

Bengal Coop Act 1940 → Ordinance 1984 → Coop Societies Act 2001 (Current)

🧠 Companies Act — Legislative Chain

1913 → 1994

Companies Act 1913 → Companies Act 1994 (Current)

🧠 Age of Majority — Never Confuse Again

18 = NORMAL | 21 = COURT

Default age = 18 years. Court-appointed guardian or Court of Wards = 21 years. [Majority Act 1875, S.3]

Islami Bank, Definition, History and Interest (Chapter 1)

Islami Bank — Definition, History & Interest | Chapter 1 | MBPLC Updated March 2026

Islami Bank — Definition, History & Interest (Chapter 1)

Updated for Mercantile Bank PLC (MBPLC) — Taqwa Islamic Banking | Deposit Products & Current Profit Rates | Source: bankessentials.blogspot.com

1. Definition of Islamic Bank (OIC Approved)

"Islami Bank is a Financial Institution, whose statutes, rules and procedures expressly state its commitment to the Principles of Islamic Shariah and to the banning of the receipt and payment of interest on any of its operations."

Approved by: OIC Foreign Ministers Summit, Dakar, Senegal — 1978

Bangladesh Bank Definition (Guidelines for Islamic Banking, 2009): Islamic Bank means a company or Islamic Banking Branch(es) licensed by Bangladesh Bank, which follows Islamic Shariah in all its principles and modes of operations and avoids receiving and paying of interest at all levels.

🧠 Mnemonic — Remember the Definition

S R P = No Interest Statutes + Rules + Procedures — all three must expressly ban interest.
"SRP — Shariah Runs Properly, No Interest Allowed."

2. History of Islamic Banking

Earlier banking meant only an interest-based capitalist system. Over time, its failures led to wealth disparity, social imbalance and economic recession — all wealth merged to the rich, damaging social balance. This gave rise to research in Islamic Banking from the 1930s. "Pilgrims Savings Corporation" was an early milestone in Malaysia.

Key Milestones

Year / Event	Detail
1930s	Research books & journals on Islamic Banking; Pilgrims Savings Corporation established in Malaysia
1963 — Egypt	First Islamic Bank: Mitgamar Savings Bank by Dr. Ahmed Al Naggar
1963 — Malaysia (Official)	Tabung Haji — officially recognised as the first Islamic Bank
1974	IDB Charter signed at OIC Finance Ministers Conference
20 October 1975	IDB officially comes into being
Bangladesh	Mercantile Bank PLC — Taqwa Islamic Banking via 45 Islamic Banking Windows (IBWs)

🧠 Mnemonic — History Sequence

NAT → IDB Naggar (Egypt 1963) → Asia / Tabung Haji Malaysia (1963) → IDB (1975)
"NAT then IDB — Naggar And Tabung, then IDB was born."

3. Mercantile Bank PLC (MBPLC) — Taqwa Islamic Banking

Vision

Would make finest corporate citizen.

Mission

Will become most caring, focused for equitable growth based on diversified deployment of resources and nevertheless would remain healthy and gainfully profitable bank.

Key Identity & Management

Item	Detail
Slogan	বাংলার ব্যাংক (Banglar Bank)
Corporate Motto	Efficiency is our strength
Islamic Banking Brand	Taqwa Islamic Banking
Name Change	Mercantile Bank Limited → Mercantile Bank PLC on 27 August 2023
Incorporation	20 May 1999
Commencement of Business	02 June 1999
Current MD & CEO	Md. Mati Ul Hasan (w.e.f. 30 November 2024) — Previously AMD & CRO
Previous MD (7th)	Md. Quamrul Islam Chowdhury (Former)
First MD	M. Taheruddin
Chairman, Board	Md. Anwarul Haque

MBPLC Network (As of 2026)

Network Item	Number (2026)
Branches	153
Sub-Branches	48
Islamic Banking Windows (IBW)	45
ATMs	197
Agent Banking Outlets	188
AD Branches	22
Offshore Banking Units (OBU)	2
Subsidiaries	Mercantile Bank Securities Ltd \| MBL Asset Management Ltd \| Mercantile Exchange House (UK) Ltd

🧠 Mnemonic — MBPLC Network Numbers

153 · 48 · 45 · 197 · 188 · 22 · 2 "One-Five-Three branches stand tall,
Four-Eight sub-branches serve them all,
Forty-Five Islamic windows shine,
One-Nine-Seven ATMs in a line,
One-Eight-Eight agents at your door,
Twenty-Two ADs & Two OBUs more!"

Core Values (7) & Ethics (7)

7 Core Values — CIECSS	7 Ethics — REST FCC
Customer Delight	Responsible
Innovation	Ethical
Ethical Values	Sustainable
Caring for Human Resources	Transparent
Commitment	Friendly
Socially Responsible	Compliant
Shareholders Value	Confidential

🧠 Mnemonic — Core Values & Ethics

CIECSS REST FCC Core Values: "Can I Ever Count Colleagues' Sincere Support?"
Ethics: "A bank at REST follows FCC rules."

Strategic Objectives (5)

To increase shareholders' value
To achieve economic value addition
To be market leader in product innovation
To be one of the top three financial institutions in Bangladesh — in terms of efficiency
To be one of the top five financial institutions in Bangladesh — in terms of market share

4. MBPLC Taqwa Islamic Banking — Deposit Products & Profit Rates

The following deposit products are offered under MBPLC Taqwa Islamic Banking, with current provisional profit rates effective March 2026.

i. Al-Wadiah & Mudaraba Current / Savings Accounts

Account Name	Abbr.	Current Provisional Profit Rate
Al-Wadiah Current Account	AWCA	—	Nil (No profit — Al-Wadiah basis)
Mudaraba Savings Account — General	MSA	3.00%
Mudaraba Savings Account — Staff	MSA-Staff	3.00%
Taqwa Mudaraba Payroll Account	TMPA	5.00% (2% higher than MSA)
Taqwa School Banking Account	TSBA	3.50%

ii. Taqwa Bonus Sanchaya Hishab (TBSH) — Slab-Based

Daily Minimum Balance (BDT)	Current Provisional Profit Rate
BDT 5,000 – BDT 50,000	3.00%
BDT 50,001 – BDT 1,00,000	4.00%
BDT 1,00,001 – BDT 5,00,000	5.00%
BDT 5,00,001 – BDT 10,00,000	6.00%
BDT 10,00,001 & Above	7.00%

iii. Mudaraba Special Notice Deposit (MSND) — Slab-Based

Balance	Current Provisional Profit Rate
Less than BDT 1 crore	1.00%
1 crore to less than 25 crore	1.50%
25 crore to less than 50 crore	2.50%
50 crore to less than 100 crore	3.00%
100 crore and above	3.50%

iv. Mudaraba Term Deposit Receipt (MTDR) — Daily Basis

Tenure	Amount Slab	Current Provisional Profit Rate
61D to 99D	Below Tk.1.00 Crore	7.00%
61D to 99D	Tk.1.00 Crore & Above	7.50%
100D to 199D	Any Amount	8.25%
200D to 299D	Any Amount	8.50%
300D to 360D	Any Amount	8.75%

v. MTDR — Monthly Basis

Tenure	Amount Slab	Current Provisional Profit Rate
MTDR-1M	Any Amount	3.00%
MTDR-3M	Below Tk.1.00 Crore	8.00%
MTDR-3M	Tk.1.00 Crore & Above	9.00%
MTDR-6M	Below Tk.1.00 Crore	8.50%
MTDR-6M	Tk.1.00 Crore & Above	9.50%
MTDR-12M	Below Tk.1.00 Crore	9.50%
MTDR-12M	Tk.1.00 Crore & Above	9.75%
MTDR-24M	Any Amount	9.75%
MTDR-36M	Any Amount	10.00%

vi. Mudaraba Masik Sanchaya Prokolpo (MMSP)

Tenure	Current Provisional Profit Rate
1 Year	8.50%
3 Years	10.00%
5 Years	10.50%
8 Years	11.00%
10 Years	11.50%

vii. Mudaraba Super Munafa Amanat Prokolpo (MSMAP)

Particulars	Tenure	Current Provisional Profit Rate
Mudaraba Super Munafa Amanat Prokolpo	1 Year / Auto renewal	10.80% p.a. (Tk.900/month per Tk.1,00,000 — before tax)

viii. Mudaraba Masik Munafa Amanat Prokolpo (MMMAP)

Particulars	Tenure	Current Provisional Profit Rate
Mudaraba Masik Munafa Amanat Prokolpo	3 / 5 Years / Auto renewal	10.20% (Tk.850/month per Tk.1,00,000 — before tax)

ix. Taqwa Bibaho Sanchaya Prokolpo (TBSP)

Tenure (Years)	Installments	Current Provisional Profit Rate
3 Years	36	10.25%
5 Years	60	10.50%
8 Years	96	10.75%
10 Years	120	11.00%
12 Years	144	11.00%
15 Years	180	11.00%
18 Years	216	11.00%
21 Years	252	11.00%

x. Taqwa Mohorana Sanchaya Prokolpo (TMSP)

Tenure (Years)	Installments	Current Provisional Profit Rate
3 Years	36	10.25%
5 Years	60	10.50%
8 Years	96	10.75%
10 Years	120	11.00%

xi. Taqwa Mudaraba Hajj Sanchaya Prokolpo (TMHSP)

Particulars	Current Provisional Profit Rate
Taqwa Mudaraba Hajj Sanchaya Prokolpo (TMHSP)	11.00%

5. Riba (Interest) — Definition & Types

Interest is any predetermined excess which is paid or received with the passage of time on principal of loan as a condition of loan and for which no counter value is paid or received and which is not related with the usage and result of loan.

Types of Riba

Type	Explanation
Riba Al-Nasia	Related to loan and time — predetermined excess charged with passage of time on principal; most common in modern banking
Riba Al-Fadl	Related to goods — excess in hand-to-hand exchange of same type of commodities of different quality

Quranic References on Riba (4 Suras)

Surah	Verse(s)
Surah Ar-Rum	Verse 39
Surah An-Nisa	Verses 160–161
Surah Al-Imran	Verse 130
Surah Al-Baqarah	Verses 275–281

🧠 Mnemonic — Types & Suras

N=Notes F=Food | RNIB Nasia = Notes / money over time | Fadl = Food / goods in exchange
Suras: Rum · Nisa · Imran · Baqarah — "Riba Noted In the Book"

6. Difference Between Profit and Interest (Riba)

Profit	Interest (Riba)
1. Earned through buying and selling	1. Realized from loan with passage of time
2. Achieved by capital, merit, time and striving	2. Taken only for giving loan
3. Uncertain and undetermined	3. Certain and prefixed in advance
4. Charged only once; does not increase with time	4. Changes and increases in course of time
5. Bears the risk of business	5. Does not bear the risk of business
6. Halal (Permissible)	6. Haram (Prohibited)

🧠 Mnemonic — Profit vs Interest

Profit = URH | Interest = CNH Profit = Uncertain + takes Risk + Halal | Interest = Certain + No risk + Haram

7. Demerits of Interest (7 Demerits)

Creates parsimony and greed
Provokes grievances and social tension
Social degeneration
Creates "Julm" (injustice / oppression)
Causes Inflation
Makes depositors idle — no incentive for productive investment
Leads to less investment in the economy

🧠 Mnemonic — 7 Demerits

8. Common Shariah Irregularities in Islamic Banking

Common Lapses: No sale-buy, no cash memo, no LC authorization, profit charged in various sequences of the same product, rent charged in gestation period.

A. General Banking Lapses

Account opened without necessary papers and proper authority approval
Cheque book issued but kept undelivered
Depositors' signatures not taken in deposit slip
Cash limit exceeded
DD payable remaining outstanding for long periods
Suspense Account and Sundry Deposit outstanding / awaiting reversal for long
Cutting and erasing found in registers — strictly prohibited

B. Bai Murabaha / Bai Muajjal Lapses

Extending cash to client directly instead of goods purchase
Adjusting old investment by extending new investment
Cash memo in client's name instead of bank's name
No similarity between cash memo amount and actual disbursement
Client takes goods from seller directly — not routed through bank
Agreement remains blank and undated

C. Bai Salam Lapses

Profit charged instantly when price paid — not in proper order
Bank officials do not receive goods and deliver to client as bank's agent
No sales agent agreement signed with client
No mention of goods particulars, delivery place, quantity, quality, date and buying price
Rebate given if export value realized earlier than due date
Agreement blank and undated

D. HPSM Lapses

Rent charged in gestation period
No record of delivery of goods
Agreement remains blank and undated

E. Musharaka Lapses

No reflection of client's part in investment documents
No similarity of equity in document vs actual
Estimate accounts used instead of actual business accounts
No survey of buying and selling of goods by bank officials

F. Mudaraba Lapses

No transparency in accounts of the business
Submission of accounts based on inference, not actuals
Interference by Sahib-al-Mal in business operations

G. Istisna Lapses

Existence of goods at time of contract (goods must NOT yet exist in Istisna)
Absence of written deed / agreement

9. ⭐ Master Quick Recall & Mnemonic Summary — Exam Ready

All information updated as of March 2026.

Topic	Key Fact	🧠 Mnemonic
OIC Definition	1978, Dakar, Senegal — bans interest via Statutes, Rules, Procedures	SRP — "Shariah Runs Properly"
BB Definition	BB Guidelines for Islamic Banking 2009 — avoids receiving & paying interest at all levels	BB 2009 — "Bangladesh Bank Defined"
First Islamic Bank	Mitgamar Savings Bank, Egypt — 1963 — Dr. Ahmed Al Naggar	NEg 63 — Naggar in Egypt, 1963
First Official IB	Tabung Haji, Malaysia — 1963	T = Two (same year, 1963)
IDB Established	20 October 1975	"75 is IDB alive"
MBPLC Vision	Would make finest corporate citizen	FCC — Finest Corporate Citizen
MBPLC Mission	Most caring, equitable growth, diversified resources, healthy & profitable	CEDH — Caring, Equitable, Diversified, Healthy
Current MD & CEO ✔	Md. Mati Ul Hasan (w.e.f. 30 Nov 2024)	Mati = Nov 2024
Network ✔ (Jan 2026)	153 Branches \| 48 Sub-Branches \| 45 IBW \| 197 ATMs \| 188 Agent Banking \| 22 AD \| 2 OBU	"One-Five-Three stand tall, Four-Eight serve them all, Forty-Five windows shine, One-Nine-Seven in a line, One-Eight-Eight at your door, Twenty-Two ADs, Two OBUs more!"
MBPLC Slogan	বাংলার ব্যাংক	Banglar Bank
Motto	Efficiency is our strength	E = S
7 Core Values	Customer, Innovation, Ethics, Caring HR, Commitment, Social, Shareholders	CIECSS — "Can I Ever Count Colleagues' Sincere Support?"
7 Ethics	Responsible, Ethical, Sustainable, Transparent, Friendly, Compliant, Confidential	REST FCC
MSA Profit Rate	3.00% (Current Provisional Rate)	MSA = 3%
MTDR-12M Rate	9.50% (below Tk.1 cr) / 9.75% (Tk.1 cr & above)	12M MTDR ≈ 9.5–9.75%
Profit Method	Weightage-based system as per Bangladesh Bank guidelines	Weightage System
Riba Types (2)	Al-Nasia (time/loan) \| Al-Fadl (goods)	N=Notes \| F=Food
Suras on Riba (4)	Ar-Rum 39 \| An-Nisa 160–161 \| Al-Imran 130 \| Al-Baqarah 275–281	RNIB — "Riba Noted In the Book"
Profit vs Interest	Profit = Uncertain + Risk + Halal \| Interest = Certain + No Risk + Haram	URH vs CNH
7 Demerits of Interest	Parsimony, Grievances, Social, Julm, Inflation, Idle, Less investment	PGS JIL — "Poor Greed Spreads, Justice Is Lost"
Shariah Lapse Modes (6)	Murabaha \| Salam \| HPSM \| Musharaka \| Mudaraba \| Istisna	MS HMS MI — "My Sister Has Many Mutual Investments"