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    Eliza Tabassum
    This presentation compares the profitability of Al-Arafah Islami Bank Limited (AIBL), an Islamic bank, to Dutch Bangla Bank Limited (DBBL), a conventional bank. The analysis finds that AIBL has higher return on assets and net profit margins than DBBL from 2013-2017. However, AIBL's return on equity and net interest margins are lower. To improve, AIBL should increase investments from trading and improve cost efficiency. Expanding branches in rural areas and promoting aggressive activities could also help AIBL enhance its profitability.

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    Slide

    Uploaded by

    Eliza Tabassum
    28 views17 pages
    This presentation compares the profitability of Al-Arafah Islami Bank Limited (AIBL), an Islamic bank, to Dutch Bangla Bank Limited (DBBL), a conventional bank. The analysis finds that AIBL has higher return on assets and net profit margins than DBBL from 2013-2017. However, AIBL's return on equity and net interest margins are lower. To improve, AIBL should increase investments from trading and improve cost efficiency. Expanding branches in rural areas and promoting aggressive activities could also help AIBL enhance its profitability.

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    Comparison of Profitability Between Islamic Bank and Conventional Bank

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    This presentation compares the profitability of Al-Arafah Islami Bank Limited (AIBL), an Islamic bank, to Dutch Bangla Bank Limited (DBBL), a conventional bank. The analysis finds that AIBL has higher return on assets and net profit margins than DBBL from 2013-2017. However, AIBL's return on equity and net interest margins are lower. To improve, AIBL should increase investments from trading and improve cost efficiency. Expanding branches in rural areas and promoting aggressive activities could also help AIBL enhance its profitability.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    28 views17 pages

    Slide

    Uploaded by

    Eliza Tabassum
    This presentation compares the profitability of Al-Arafah Islami Bank Limited (AIBL), an Islamic bank, to Dutch Bangla Bank Limited (DBBL), a conventional bank. The analysis finds that AIBL has higher return on assets and net profit margins than DBBL from 2013-2017. However, AIBL's return on equity and net interest margins are lower. To improve, AIBL should increase investments from trading and improve cost efficiency. Expanding branches in rural areas and promoting aggressive activities could also help AIBL enhance its profitability.

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    You are on page 1of 17

    Welcome to My Presentation

    Comparison of Profitability
    Between Islamic Bank and
    Conventional Bank
    Prepared By Supervised by

    MD. RAKEEB ASHRAF TANZIA RAHMAN


    ID # 2-15010218 Lecturer
    Major in Finance Notre Dame University
    Bangladesh
    This presentation will include

    1. Executive 2. 4.Methodolo
    3. Objectives
    Summary Introduction gy

    6.Findings &
    5. Analysis Recommendati 7. Conclusion
    on
    Executive Summary

     This study focuses on the profitability comparisons between Al-Arafah Islami

    Bank Limited (AIBL) and Dutch Bangla Bank Limited (DBBL). AIBL is
    representing as an Islamic bank and DBBL is representing as a Conventional
    bank. AIBL is an Islamic Bank based on Islamic principles and DBBL is a
    Conventional bank based on Man-Made Laws. The study evaluates the bank
    performance of AIBL and DBBL in terms of profitability.
    Introduction

     AIBL performs as trader, agent or partners in business but not the lending

    institutions. Interest is completely prohibited in Islamic banking. It is a


    relationship of profit and loss sharing.

     DBBL is profit-oriented conventional bank and its purpose is to make

    money through interest.


    Objectives

    Major Objective

     To understand the concept of profitability and make comparisons between


    Al-Arafah Islami Bank Limited and Dutch Bangla Bank Limited.

    Specific Objective

     To understand how an Islamic Bank runs its business without charging


    interest.
    Methodology

    Research Type Data Type

     Focused on descriptive type

    of research design.
    Primary Data

     Emphasized on the
    Secondary Data
    financial and statistical
    observation of two banks.
    Analysis

    The study analyzed by several types of profitability ratio

    Return on Assets (ROA)

    Return on Equity (ROE)

    Net Profit Margin

    Net Interest Margin (NIM)


    Return on Assets (ROA)

    1.40%

    1.20%

    1.00%

    0.80%
    AIBL
    DBBL
    0.60%

    0.40%

    0.20%

    0.00%
    2013 2014 2015 2016 2017
    Return on Equity (ROE)

    20.00%
    18.00%
    16.00%
    14.00%
    12.00%
    10.00% AIBL
    DBBL
    8.00%
    6.00%
    4.00%
    2.00%
    0.00%
    2013 2014 2015 2016 2017
    Net Profit Margin

    20.00%
    18.00%
    16.00%
    14.00%
    12.00%
    10.00% AIBL
    DBBL
    8.00%
    6.00%
    4.00%
    2.00%
    0.00%
    2013 2014 2015 2016 2017
    Net Interest Margin (NIM)

    4.50%

    4.00%

    3.50%

    3.00%

    2.50%
    AIBL
    2.00% DBBL

    1.50%

    1.00%

    0.50%

    0.00%
    2013 2014 2015 2016 2017
    SWOT Analysis

    AIBL has better ROA and Net Profit Margin than DBBL
    Strength Everyone has faith on Islamic bank

    AIBL’s ROE and NIM are low as compared to DBBL


    Weakness Lack of large branch network in rural area

    Demand of Islamic bank is increasing day by day in our


    Opportunity country

    Other banks are also opening Islamic banking branch


    Threat
    AIBL binds with some strong Shariah rules
    Findings

     Islamic banks perform better in environments where investment are high.

     With efficient management, AIBL leads to greater return on assets and Net

    profit margin.

     AIBL investment policy is not effective in the entire sector.

     AIBL needs to increase its Earning Per Share.


    Recommendation

     Islamic Bank should take its strength by increasing investments which are

    coming from trading business.

     Improvement in cost efficiency to achieve higher profits and increasing the

    chance of survival in competitive markets.


     AIBL should increase their revenue to improve its EPS ratio.

     AIBL should go with aggressive and promotional activities.


    Conclusion

     Banking industry in Bangladesh is highly competitive; every bank wants to

    increase their market share by providing various services to the customers. Al-
    Arafah Islami Bank Ltd (AIBL) is one of the most potential Islamic bank in
    the Islamic banking sector in Bangladesh. The management of AIBL always
    tries to maintain a steady growth by delivering their banking services across
    the country. In order to be successful bank, management should take care of
    their problem as well as it should make attractive investment scheme for the
    customers.
    THANK YOU
    ANY Queries?

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