Risk Rating Grade Details Bangladesh Bank criteria for bad & loss Investment shall apply. An Aggregate Score of less than 35 based on the Risk Grade Score Sheet. Approval Authority A. Basics of Approval Authority 1. All powers of the Bank are vested in the Board. They are the source of all powers, and any person or body can exercise only the powers delegated by the Board in ways and manners specified by them. 2.
First Security Islami Bank Limited believes in decentralization of powers. With a view to ensuring prompt and efficient services to its multitude of clients spread far and wide, the Bank envisages delegation of optimum powers to its Executives and Officials at different levels of operations. But, while delegating powers, the Board is also aware of the followings: a. The Board can delegate the authority, not its responsibility. b. The evil of dual sub-ordination may creep in the chain of command if authority is not well defined and properly implemented. c. Exercise of the delegated authority must commensurate with the shouldering of the responsibility. 3. In order to implement the system of delegation of powers effectively, and to derive the desired benefit for the Bank as well as the Executives concerned, the Bank must develop a system to ensure that the delegated authority exercised by the Executives can be evaluated realistically and qualitatively. For that purpose, the Bank will have to develop a Management Information System (MIS) so that the Board gets prompt and systematic feed back as to how effectively and efficiently the delegated authority is being exercised by the Executives. For the purpose of investment of Bank’s Fund, the cardinal principle is ‘Safety first, Business next’. Delegation of power shall test the ability of the Executives to take decisions judiciously with honesty and integrity to achieve the objectives of the Bank. 4. The Investment approval function has been separated from the marketing/relationship management function. 5. Unless personally authorized by a separate letter, mere mention of delegation in these guidelines shall not entitle an official falling under the category to exercise the powers. 6. Delegated approval authorities shall be reviewed annually by Managing Director & CEO/ Executive Committee of Directors / Board of Directors 7. All Investment risks must be authorized by executives within the authority limit delegated to them by the Managing Director & CEO/ Executive Committee of Directors / Board of Directors. The “pooling” or combining of authority limits is not permitted. 8. The aggregate exposure to any borrower or borrowing group is used to determine the approval authority required. 9. Any Investment proposal that does not comply with Investment Guidelines, regardless of amount, has to be referred to Head Office for Approval.
Published on Mar 10, 2013