| dc.description.abstract | This report assesses the general state of IDLC Finance PLC and the Non-Bank Financial Institution (NBFI) through an analytical review and real-life experience during internship with the Credit Risk Management (CRM-SME) department of IDLC Finance PLC.
The introduction chapter brings out the increase in the relevance of the NBFI sector to the global and the Bangladeshi financial systems. The results indicate that NBFIs are important in offering alternative financing and especially financing SMEs, leasing and long-term investments where conventional banks are not so aggressive. Nevertheless, the industry in Bangladesh is also experiencing structural issues such as high non-performing loans, liquidity and growing regulatory control.
According to the company analysis chapter, IDLC Finance PLC stands in a strong position as one of the top NBFIs in Bangladesh because it has diversified product lines, good brand image, and operations in corporate, SME, retail and capital market segments. The analysis of financial performance and operational performance during the previous five years indicate the modest asset growth and consistent lending growth, however the profitability had its ups and downs because of the growing financial costs and pressures of the market. Nevertheless, the increase in the profitability indicators in 2024 is associated with the positive operation performance and robustness of the institution despite these challenges.
The industry analysis has shown that the NBFI industry in Bangladesh has become a mature industry with moderate growth, intense competition, and stringent regulation. The analysis reveals that NBFIs are playing a key role in SME development, infrastructure financing, and financial inclusion, but the industry is facing threats like governance issues, increased non-performing loans, and a lack of depositor confidence. Meanwhile, there are opportunities in terms of fintech integration, digital financial services, and growing demand of both SME and consumer financing.
The chapter on the internship experience illustrates that there was practical exposure to credit risk assessment processes in the context of SME financing. The experience identifies the significance of credit analysis, risk analysis of the borrower, and the application of Credit Information Bureau (CIB) reports on the creditworthiness of the borrowers. It also contributed towards development of analytical, technical and professional skills as the internship gave an insight on the operations of a financial institution, documentation management and internal coordination.
In general, the report findings reveal that although IDLC Finance PLC stands on a firm market and a diversified financial services portfolio, the NBFI sector in Bangladesh is in the structural adjustments phase owing to regulatory tightening and financial sector pressures. Credit risk management practices, online financial technology adoption and enhancing the quality of governance will be critical to the long-term sustainability and growth of IDLC Finance PLC as well as the NBFI sector in Bangladesh. | en_US |
