City Bank Ltd started its operations on 28 March 1983 with an authorised capital of Tk 200 million divided into 2,000,000 ordinary shares of Tk 100 each and paid up capital of Tk 34 million, of which Tk 30 million was paid up by its promoters and the remaining amount by the government of the People's Republic of Bangladesh. In 2000, the bank's paid up capital rose to Tk 160 million, of which Tk 80 million was subscribed by the sponsors/promoters and the remaining amount by the general public. On 31 December 2000, the bank's reserve fund was Tk 263.1 million as compared to Tk 125.22 million in 1995. But there was shortfall in total capital adequacy ratio of the bank during 1997-2000 as per BIS (Bank for International Settlement) standards to be followed by banks operating in Bangladesh.

The management of the bank is vested in a 13-member board of directors. That includes the chairman and a vice-chairman. The managing director is the chief executive. He is assisted by three deputy managing directors, three executive vice presidents, fourteen vice presidents, fifty-four assistant vice presidents and some other employees of different categories. The total number of employees of the bank stood at 1,845 at the end of business year 2000. That time the bank had 76 branches throughout the country. Sixty-one of them were urban and 15 were rural. It had 6 regional offices established at the 6 divisional towns/cities.

The bank conducts all types of commercial banking activities. Core businesses of the bank include deposit mobilisation, lending and foreign exchange dealings. At the end of the initial year of its operations in 1983, the total deposits were Tk 320.2 million, which rose to Tk 11,603.2 million in 2000. Total and net loans and advances of the bank amounted to Tk 9,964.6 million and Tk 7,698.2 million respectively in December 2000. The broad economic sectors in which the bank provides lending are agriculture (0.80%), term loans to large and medium scale industries (18%), housing (1.75%), working capital and commercial lending (35%), import (9.9%), export (10.5%) and others (24.05%).

The quality of the bank's lending assets deteriorated due to huge non-performing loans. The ratio of its classified loans was 43% in 1997, 40.85% in 1999 and 39.57% in 2000. Total assets of the bank including off-balance sheet items accounted for Tk 30,806.9 million in 2000, when its gross earning assets and liquid assets were valued at Tk 14,884.3 million and Tk 6,430.8 million respectively. In 1999, the total foreign exchange business handled by the bank stood at Tk 9,838.3 million (import 87%). Dealings in foreign remittances were only Tk 815 million during 1999. Out of its 76 branches, 19 are now authorised to deal in foreign exchange. The bank has correspondent relationships with 255 bank/bank offices and other financial institutions abroad.

Total investment of the bank at the close of the year 1999 was Tk 1,492.8 million, of which Tk 1,140 million was in treasury bills. Other investments included those in shares and securities. The income on all investments that year was Tk 101.1 million. The bank earned an operating income of Tk 1,356.5 million and incurred operating expenses of Tk 375.7 million in business year 2000. Net profit of the bank before deducting tax and provision for classified loans stood at Tk 188.3 million in the same year. After appropriation of operating profit with accumulated losses of Tk 121.6 million, the bank still suffered a cumulative loss of Tk 66.7 million up to December 2000. [S M Mahfuzur Rahman]