The Royal Government of Bhutan, under the Royal Charter to meet the Banking needs of the nation, established Bank of Bhutan. Phuentsholing Office as its Head Office as well as Branch on 28th May, 1968 as a pilot Bank. It is a matter of great pride that today after 36 years of being in operation, the Bank of Bhutan today stands as the largest commercial Bank in the kingdom with a network of 26 branches and 3 extension counters across the Kingdom and also at prime Industrial and growth centres.

CORPORATE DATA:
(a)	Year of Establishment	-	May 28, 1968
(b)	Authorised Capital	-	Nu.250,000,000.00
(c)	Paid-up Capital	-	Nu.100,000,000.00
(d)	Head Office		Post Box No. 75, Samdrup Lam, Phuentsholing, Bhutan.
BANK'S VISION:
1.	Bank with world class standard of efficiency and professionalism.
2.	Retain its position in the country as a premeir Financial Institution.

MISSION:

• Profit with growth.
• Provide personalized & efficient customer service.
• Maintain a healthy deposit mix with strong fund base.
• Promote export, trade & commerce, Industries and service enterprises within the country.
• Support entrepreneurs by identifying, training and extending soft finance & thereby supporting the Govt. plans for private sector growth.
• Develop and maintain a team of dedicated, competent and compact work force.

ORGANISATIONAL STRUCTURE:

THE EXECUTIVE COMMITTEE OF THE BOARD:

	Mr. Karma Y. Raydi Research I, People's Project CHAIRMAN
Mr. Karma Penjor Dratshang Lhenshog DIRECTOR	Mr.Pema Nadik C/s Dolma Enterprise DIRECTOR	Mr. Kinga Tshering Chief Executive Officer Bank of Bhutan Limited Member
Mr. Rakesh Sharma State bank of India DIRECTOR	Mr. P.S. Prakesh Rao State Bank of India DIRECTOR

OPERATIONAL HIGHLIGHTS:

Amount in millions of Ngultrum
FOR THE YEAR ENDED	2006	2005	Increase in %
Total Income	792.217	616.615	28.47
Total Expenditure	509.043	422.537	20.47
Profit before Tax	283.174	194.078	45.91
Net Profit after Tax	198.635	137.480	44.48
AT THE END OF	2006	2005	Increase in %
Paid up Capital & Reserve	1260.318	1,111.683	13.37
Deposits	15174.516	12,486.395	21.53
Advances	4381.490	3,048.177	43.74
Total Assets/Liabilites	17141.274	14,585.185	17.52
No. of branches	26	26	-
No. of employees	558	560	-0.36
Business per Employee	35.05	27.74	26.35

BRANCHES:

Sl #	Branch Name	Date of Opening
1.	Phuentsholing Main Branch	28/05/1968
2.	Thimphu Main Branch	01/10/1970
3.	Samdrupjongkha	28/09/1972
4.	Gelephu	04/12/1972
5.	Tsimasham	19/06/1976
6.	Smatse	18/02/1977
7.	Trashigang	20/04/1977
8.	Damphu	02/07/1977
9.	Bazaar Branch (Phuentsholing)	17/02/1979
10.	Gomtu	17/12/1980
11.	Mongar	01/09/1981
12.	Bumthang	06/11/1981
13.	Wangdue	13/03/1981
14.	Paro	17/07/1981
15.	Trongsa	24/12/1982
16.	Ha	19/08/1983
17.	Gedu	21/12/1983
18.	Zhemgang	09/03/1984
19.	Lhuntse	22/05/1985
20.	Punakha	04/01/1986
21.	Pemagatshel	17/07/1986
22.	Sipsu (merged with Samtse branch branch on 30/04/1995)	12/12/1988
23.	Sarpang	18/12/1988
24.	Dagana	24/04/1990
25.	City Branch (Thimphu)	25/06/1991
26.	Dewothang	04/06/1993
27.	Tashiyangtse	17/06/2001

EXTENSION COUNTERS:

Sl #	Extension Counter	Operation
1.	Chukha	Twice a week
2.	Paro Airport (Foreign Exchange only)	Daily

With the given branch network, the Bank of Bhutan has made every effort to bring Banking facilities to the Rural mass. The sustenance of this network has, however, remained non-cost effective for the Bank due to low-keyed economy in most Dzongkhags. From our existing 26 branches, most of the branches have been operating at loss since inception and will continue to do so for a long period of time in future. The primary factors for the branch losses have been :-

1. High establishment cost due to observation of the security measures that are mandatory for opening a Bank branch.
2. High interest cost of deposits with unmatched return on loans and advances.
3. Very low miscellaneous business income.
4. The recurring insurance and transfer cost on remittances.

Despite the large cost involved in operating rural branches with unmatched return in income from lending, miscellaneous business and in-country investments, the Bank of Bhutan has always put in tireless effort to provide the best possible banking services in the country and will continue to influence and support the developmental plans of the Royal Government at all times.

EXTENSION OF MORE FINANCIAL SERVICES FOR THE FURAL AREAS:
The Bank of Bhutan fully endorses the need for expansion of financial services to the Rural areas with the following aims & objectives :

1. To foster development of agriculture, trade & commerce, small scale/medium sized industries and other productive activities aimed to raise their standard of living.
2. To inculcate savings habit of the Rural folks and accelerate economic growth at socially desired growth rate.
3. To encourage the borrowers to adopt new technologies without which sufficient capital cannot be generated to repay loans.
4. To make sure that lending machinery is matched by recovery machinery. Even a slight imbalance, can lead to heavy defaulting and consequent collapse of the scheme.
5. To study the potential area in terms of Banking and marketing business

ECONOMIC FEASIBILITY:
The most commonly used criterion for judging the economic feasibility of Branch Expansion is the benefit-cost ratio. Bank of Bhutan as a leading commercial Bank of the nation introduced many social schemes to bring down the imbalance between the Urban and Rural banking scenario. Some of the schemes introduced by the Bank which ultimately proved unsuccessful :

1. Farmers Horse Loan : Introduced with a aim to boost the earnings of the farmers by transportation of mandarin and other cash crop.
2. SBCA : A Scheme for the benefit of village businessman & artisans to enhance their business activities and earning capacity.