Loan Portfolio Management of IPDC Finance PLC

Abstract

The report starts with a company overview that includes a detailed description of the products and services it offers, the company’s mission and vision, its management, the strategic decisions IPDC has taken over the years since its establishment in 1981. It also provides a brief outline of the milestones it achieved and the evolution it has gone through in terms of customer count, profitability, branch and employee expansion. IPDC’s mission and core values express its eagerness to serve three broad segments, namely, the youth, women empowerment, and enhanced financial inclusion in underserved areas. In the main analysis under chapter three the report presents a comprehensive analysis of IPDC’s loan portfolio management over the past five years, from 2019 to 2023. Its loan disbursement has been evaluated based on five main categories, namely loan maturity, geographic region, industry segmentation, types of domestic loans disbursed, and the broader economy. The first type, loans classified according to the "Types of domestic lending," showed ten different segments into which IPDC has disbursed its loans throughout the years. Among these, it is observed that IPDC has disbursed the highest on its long-term loans with an average of 39.08% and the second highest into its short-term loans of 23.02%. According to loan maturity, the "More than one year but less than five years" category had the highest loan disbursed compared to other categories, with a five-year average of 42.39% in this category. Loans disbursement classified by industry basis shows fourteen different significant industries, among which the "Ready-made garments and knitwear" industry has the highest investment, at an average of 10.45%, and the second-highest investment is in the Agro-based sectors, at an average of 7.49%. However, 45.27% of its investments are allocated to several other industries, industries that are not specified. According to the geographic region, IPDC has disbursed loans from eight different divisions, among which Dhaka has had the highest disbursement, with an average of 77.97% over the past five years. Nonetheless, the distribution according to the broader economy shows that the private sector has 98.75% of IPDC's total loans. Whereas other banks and NBFIs hold only 1.25% of IPDC's total loans over the years. Under chapter three, each category provides a detailed analysis of these loan disbursements to comprehend trends, along with a visual representation of each type. Overall, the analysis offers valuable insights into IPDC’s loan portfolio management and suggests financial strategies to optimize opportunities and encounter challenges.