3.1  Advance:
In modern age commercial bank does different kinds of responsibilities. Giving Advance is one of the main issues of them. we can describe advance like this by focusing on its practical aspects:-
“Depending on the relation between bank and customer, bank offer ensuring to the client’s purpose and paying schedule” again  when the bank gives special advantage or extra money to clients is called advance. For giving advance bank has a fixed regulation.


Necessity And Importance Of Advance:
Bank pays interests in fixed basis to different categories of depositors. After all to run the administration and branches of bank needs lots of money. Finally, to sustain as a commercial organization needs to make profit after paying money to these fields, so, for shake of bank has to pay back the capital property to the people which was taken from them. Bank cannot make profit equally from all kinds of advance. It overall depends on the right use and principles of advance. On other hand if it stocks all deposits it’s also not goes to the bank requirements. So, has to balance between these two.

SOURCES OF ADVANCE OF JBL:

Below described sources are the ways of bank advance:-
a)      Different classes of deposits.
b)      Unalloyed profit and reserve.
c)      Loan from Bangladesh bank, other banks and sources.

Among these sources different kinds of deposits are main, because bank cannot use other resources in its need anytime except deposits. Of bank wants to pay advance from other resources has to face different kinds of obstacles. So, deposit is the best source to use in any purpose bank wishes.

3.2  Selecting clients rights and Bank responsibilities:

Sound Principle of Lending:
When any bank allows a loan to a client it focuses on loans purpose and on the honesty of  it’s payback more rather than taking security assets . If unwillingly any client is not able to pay the loan back than the bank takes away the security assets. Although there has a risk in all kinds of loans, but to bound it in a limit has some principles that should be followed safety, liquidity, purpose of the loan, security, profitability, spread of loan and National interest is briefly called principles of lending.

1. 1.      Safety: For bank loan there has a word for it is “Safety first” so ford giving loans or advance a bankers first principle should be the safety. The existence of banks depends on the lending safety. So, banker should not be careless about the safety of lending money. The safety of lending is the most important thing for a bank to be in a good condition.

1. 2.      Liquidity: Banks Need to careful when giving advance. The loan money cannot be left or stocked for a long time what can make the bank loan advance less liquid and that can be very difficult to get back during the time of special situation.

1. 3.      Security: Land, building , FDR, commercial papers can be the security against the loan. In some fields loaner’s personal commitment is the main key to give loans. There is a word “Security is only a cushion to fall back upon in case of that has to be sufficient, easily sellable and fully non demandable.

1. 4.      Profitability: One of the main source of banks profit is getting profit from loan giving. Mainly bank takes deposit from clients by giving them interest. Bank has to give salaries to its workers, officers, and bank incomes money basically from interest of loan / advance. Bank invests money there from where bank has a security to get capital and interest a together.

1. 5.      Spread: Whole money should not be invested on one group or party. So, if you invest to one party, if this party makes loss in business the bank has to suffer. So, the investment should not be on a specific area and on specific field. “It is better to give small amount of loan to a big size of parties rather than giving big amount of money to a small size group”.
2. 6.      National Interest: Bank has a principle key role on national economic growth. For the greater interest of the country bank gives loans in sectors these are highlighted by the development plan implementation. Sometimes bank gives loans in risky field such as agricultural, industry, small business, and export business for the national interest.
3. 3.3  Advance processing of JBL:
   Generally a bank takes certain steps to deliver its proposed advance to the client. But the process takes deep analysis. Because banks invest depositors fund, not banks’ own fund. If the bank fails to meet depositors demand, then it must collapse. So, each bank should take strong concentration on advance proposal. However, Janata Bank Limited (JBL) makes its advance decision through successfully passing the following crucial steps:
4. 1. 1.     SELECTING LOAN TAKERS /CLIENTS:
   
   The main quality of loaner is to use the loan money properly and give payback the money fall with due interest. So, the lender should have to be confirmed first that the loan taker will be able to meet this. If the lender could not believe that loan taker can pay back the loan money and due interest in time, need not give loans. The experts duly that why says that after analyzing “ 5.C” have to select the loan client. So, before allowing loan money for selecting candidate necessary activities should be done with carefulness and honesty.
   Generally, bank analyses the following five C’s of the client:
   
   • Character;
   • Capacity;
   • Capital;
   • Collateral;
   • Condition;
   • Other necessary activities;
   
   
   1. Character – It is intention of the borrower to pay the loan. It determines the moral risk. It includes integrity of purpose, reputation for honesty, promptness in paying debts & fulfilling contract, high standard of business ethics & records of past performance.
   
   
   2. Capacity – It is Borrowers competence in the field to employ the fund profitably & ability to generate income. It indicates the business risk. Capacity involves business ability of borrower, reputation of product & soundness of business method.
   3. Capital– It is the financial strength of a risk. It is measured by the equity or net worth of the business.
   4. Condition – It is the general business conditions and the conditions of the particular industry in which the applicant is involved.
   5. Collateral – It implies the additional security taken to offset weaknesses that are apparent in the risk.
   Before performing credit report, the Manager has to go through an investigation. The degree of investigation will be greater or less depending upon the amount of the loan & whether the loan is or is not secured.
   
   1. 2.     Application stage:
   
   At this stage, the bank will collect necessary information about the prospective client. For this reason, bank informs the prospective client to provide or fill duly respective information which is crucial for the initiation of advance proposal. Generally, here, all the required documents for taking loan have to prepare by the client himself. Documents that are necessary for getting loan of JBL is prescribed below:
   
   
   1.             I.                                  Trade License photocopy (for proprietorship);
   2.          II.                                  Abridged pro forma income statement;
   3.       III.                                  Attested copy of partnership deed (for partnership business);
   4.       IV.                                  Prior three (03) years’ audited balance sheet (for joint stock company);
   5.          V.                                  Abridged pro forma income statement for loan program;
   6.       VI.                                  Attested copy of the Tax Identification Number (TIN)- including final assessment;
   7.    VII.                                  Tenders of the proposed assets
   8. VIII.                                  Detailed summary of the sundry debtors and creditors (including both time & schedule);
   9.       IX.                                  Summary of the personal movable & immovable assets; and others.
   
   3. Appraisal Stage:
   At this stage, the bank evaluates the client and his/her business. It is the most important stage. Because, on the basis of this stage, bank usually goes for sanctioning the proposed loan limit/proposal. If anything goes wrong here, the bank suddenly stops to make payment of loan.
   
   However, the following contents are presented from that appraisal report:
   
   1. A.                           Company’s/Client’s Information.
   2. B.                             Owner’s Information.
   3. C.                           Purpose of Investment/Facilities.
   4. D.                          Details of Proposed Facilities/loan.
   5. E.                             Break up of Present Outstanding.
   6. F.                              Previous Banker’s Information.
   7. G.                          Business/Industry Analysis.
   8. H.                            Relationship Analysis.
   9. I.                             Asset-Liability position of the client as per Audited Balance Sheet.
   10. J.                            Working Capital Assessment.
   11. K.                           Risk Grade.
   12. L.                           Insurance Coverage.
   13. M.                        Audit Observation.
   14. N.                           Security Analysis.
   
   
   
   1. 4.                                  Sanctioning stage:
   
   At this stage, the bank officially approves the investment proposal of the respective client. In this case client receives bank’s sanction letter. Janata Bank Limited (JBL)’s sanction letter contains the following elements:
   
   1.           I.                                    Mode & amount of loan.
   2.        II.                                    Investment Limit
   3.     III.                                    Purpose of loan.
   4.      IV.                                    Period of loan.
   5.         V.                                    Rate of return.
   
   
   1. 5.                                    DOCUMENTATION:
   At this stage, usually the bank analyses whether required documents are in order. In the documentation stage, Janata Bank Limited (IBBL) checks the following documents of the client:
   
   1. Tax Payment Certificate.
   2. Stock Report.
   3. Trade License
   4. VAT certificate
   5. Liability statement from different parties.
   6. Receivable from different clients.
   7. Other assets statement.
   8. Aungykar Nama.
   
   
   9. Ghosona Potra.
   10. Three (03) years net income & business transactions.
   11. Performance report with the bank.
   12. Account Statement Form of the bank.
   
   
   
   1. 6.                                    DISBURSEMENT STAGE:
   
   At this stage, bank decides to pay out money. Here, the client gets his/her desired fund or goods. It is to be noted that before disbursement a “site plan” showing the exact location of each mor9.tgage property needs to be physically verified.
   
   
   1. 7.                                    MONITORING AND RECOVERY STAGE:
   
   At this final stage of advance processing of the Janata Bank Limited bank will contact with the client continually. the bank will keep his eye on over the loan taker. If needed, bank will physically verify the client’s operations. Also if bank feels that anything is going wrong then it tries to recover its loan fund from the client.
   
   
   3.4   DIFFERENT TYPE OF LOAN OF JANATA BANK:
   Different type of loan and advances provided by JBL which are given bellow-
   
   General house building loan (GHBL):
   
   House building loan is a very vital loan of JBL. The purpose of this loan is to given support to construction of building. For this reason the building sector of our countries developing most of the real state companies are taking huge amount of loan from JBL. From house building loan both bank and customer are being gainers.
   
   
   Objectives:
   
   • To extend the benefits of the loan of the Bank under the Scheme to different sections of the people.
   • To assist in solving the existing housing problem of the country.
   • To assist the service holders and professionals with fixed income to arrange for houses of their own.
   • To extend the investment facilities of the Bank to every corner of the country, by size of loan, by sector of loan and on the basis of geographical area.
   
   Target Area: The target of house building of JBL is all over Bangladesh.
   
   Rate of interest: The rate of interest is 15% which are  for customers and bank job holder of JBL is 5%.
   Procedure for Application:  Interested persons shall have to apply in prescribed form of the Bank through the Branch of the concerned area. The Bank shall sanction investment if the proposal is found acceptable after examination of its viability and profitability. The Bank reserves the right to sanction or reject any advance proposal.
   
   Car Loan Scheme:-
   Janata Bank has introduced the ‘Car loan Scheme’ for the mid and high ranking officials of government and semi-government organizations, corporations, executives and directors of big business houses and companies and also for persons of different professional groups on easy payment terms and conditions.
   
   Objectives
   
   • To assist in minimizing transport problem and help the mid and high ranking officials and professionals with fixed income in the improvement of their standard of living.
   • To extend the range of Bank’s loan facilities to various sections of people in line with the ideals of the Bank.
   • To diversify the investment portfolio of the Bank by size, sector and volume..
   
   
   
   
   Rate of Return: the rate of interest of JBL is 1% for bank employee and the customers is 6.5%.
   
   
   Loan Against Motorcycle ( LAM ):
   Motorcycle loan is very supportive for our real life. Motorcycle is considered as an essential mode of transport in the modern society, particularly by a section of the officials, business houses and business executives and established professionals for movement in discharging their duties and responsibilities punctually and efficiently.
   
   Objectives:
   
   • To assist in minimizing transport problem in the private sector and help the mid and high ranking officials and professionals with fixed income in the improvement of their standard of living.
   • To extend the range of Bank’s investment facilities to various sections of people in line with the ideals of the Bank.
   
   Ceiling of Bank’s Investment:
   Bank’s investment is maximum Tk. 80 thousand per client against purchase cost of the vehicle. Registration and comprehensive insurance cover shall be in the name of the Bank. The clients shall have to bear all subsequent expenses relating to blue book, registration, first party insurance, tax token etc.
   
   Rate of Return:  The rate of interest of motorcycle loan is 5%.
   
   
   
   
   
   Loan Against Bicycle (LAB):
   
   This loan is one of most important loan of JBL. Most of the poor peoples are gets help from this loan. The rate of interest of bicycle of JBL is 5%. The interest rate is very flexible for customers.
   
   
   Loan Against Import:
   The role of modern communication is most vital for the socio-economic growth and uplift of a developing country like Bangladesh. A sound and efficient communication network is the pre-requisite for sustained development through the expansion of trade, commerce and industry. Loan against import is important loan of JBL. Huge of export/import businessman are involve in this loan.
   
   Rate of Return:  The rate of interest of import loan is 6%.
   Target Area :   The target are of the loan is all over the world.
   
   
   Loan Against Fixed Deposit (LAFD):
   A bank is an organization whose principle operation s are concerned with the accumulation of the temporally idle money of the general public for the purpose of advancing to other for expenditure. JBL do not section any loan without mortgage.
   There are two types of mortgage:-
   
   1. Tangible mortgage:-Like deposit receipt of deposit, share, insurance, properties, fixed assets, etc.
   2. In tangible mortgage:-Personal mortgage.
   
   Application Process of LAFD:
   The security of loan is acceptable then a form will fill up which evaluate the time of loan. The potential borrower will submit an application to bank for loan against FDR in white page or official pad. Sign of the application will be came as certified signature receipt number. Date issue of expires mention in here.
   Interest of loan: – Generally it will be 3% but for another bank it can be 12 point 50%
   
   Loan Against Provident Fund ( LAPF ):
   
   Janata bank, as welfare oriented financial institution, is committed to generate employment and bring about an overall improvement in the socio-economic condition of the people and the quality of their life.
   
   Eligibility of the Clients : Official employments are right person of this loan.
   
   Rate of Return: The rate of interest of this loan is 3%.