mcb

COMSATS Institute of Information Technology

Sahiwal

An Internship Report

Internship Report

On

Muslim Commercial

Bank

SUBMITTED TO:MR. MUZHAR JAVED

SUBMITTED BY:TARIQ MAHMOOD ASGHAR

MBA (FINANCE)

MBAF07-77

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ACKNOWLEDGEMENT

I am really pleased here to acknowledge the

sheer efforts and extreme of numerous people,

those who have provided me their relentless

service in the completion of my internship report

on “Business practices at Muslim Commercial

Bank”.

I would like to express my gratitude to my

advisors in Muslim Commercial Bank who support

me to under stand the working in the bank,

during my internship. They really helped me a lot

to gain practical knowledge about general

banking. I am also grateful to Mr. ANWAR BHATTI

(Manager MCB Pattoki) and all my supervisors

during internship period. Without their guidance,

this exercise of internship would not have

resulted in a success.

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Secondly I would like to thank my advisor SIR

MAZHAR JAVEED for his assistance and inspiring

attitude. I am highly obliged to my respectable

advisor and state my gratitude for his valued

guidance and his concern about my internship.

Tariq Mahmood Asghar

DEDICATION

I dedicate this report to my loving parents

without their guidance I would have gone

astray.

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TABLE OF CONTENTSDESCRIPTION PAGE #

Executive Summary 01

About MCB 02

Vision 05

Mission 06

Values 07

Awards and Accolades 08

Corporate Profile 12

Organizational Structure 14

Branch Hierarchy 16

Head Office 19

Prominent Features 22

Services 26

General Banking 35

Accounts 40

Agriculture Financing 49

Islamic Banking 54

Online Banking 58

Marketing Strategies 61

SWOT Analysis 63

Financial Analysis 65

Balance Sheet 66

Profit and Loss Account 68

Cash Flow Statement 70

Ratio Analysis 72

Internship Activities 73

Recommendation 77

Conclusion & Bibliography 78

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EXECUTIVE SUMMARY

This report is about Muslim Commercial Bank, its history, and the functions of the

bank. This report contains detail about what I have learned in my six-week internship

in Muslim Commercial Bank. It starts with the short history and background and brief

introduction about the management of MCB. The vision of the bank along with its

mission and existing status has also been discussed. This report contains detail

about “business practices in Muslim Commercial Bank.

The purpose of this exercise was to learn while working in the practical field.

Specially, the knowledge related to the General Banking and advances. It has really

helped me observe to what extent the bookish knowledge is being practiced in real

field.

This report contains current financial position of the bank, the business process of

the bank and all my learning, during the internship period.

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THE MUSLIM COMMERCIAL BANK LIMITED

MCB is one of the leading banks of Pakistan with a deposit base of about Rs. 280

billion and total assets of around Rs.300 billion. Incorporated in 1947, MCB soon

earned the reputation of a solid and conservative financial institution managed by

expatriate executives. In 1974, MCB was nationalized along with all other private

sector banks. This led to deterioration in the quality of the Bank’s loan portfolio and

service quality. Eventually, MCB was privatized in 1991.

During the last fifteen years, the Bank has concentrated on growth through improving

service quality, investment in technology and people, utilizing its extensive branch

network, developing a large and stable deposit base and managing its non-

performing loans via improved risk management processes.

Muslim Commercial Bank is working as a scheduled commercial bank. The Bank

provides all types of banking services such as Deposit in Local Currency, Client

Deposit in Foreign Currency, Remittances, and Advances to Business, Trade,

Industry and Agriculture. Muslim Commercial Bank plays a vital role in the national

economy through mobilization of hitherto untapped local resources, promoting

savings and providing funds for investments. Attractive rates of profit on all types of

deposits, opening of Foreign Currency Accounts and handling of Foreign Exchange

business such as Imports, Exports and Remittances, Financing, Trade and Industry

for working capital requirements and money market operations are some facilities

being provided by the Bank. The lending policy of Bank is not only cautious and

constructive but also based on principles of prudent lending with maximum emphasis

on security. As agriculture is considered as backbone of our economy the Muslim

Commercial Bank has introduced "AGRI FINANCING PRODUCTS" to small farmers.

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History

MCB Bank Ltd formerly known as Muslim Commercial Bank Limited was

incorporated by the ISFHANI and ADAMJEE Group on July 9, 1947, under the

Indian Companies Act, VII of 1913 as a limited company. After the partition of the

Indo-Pak Subcontinent, the bank moved to Dhaka from where it commenced

business in August 1948. In 1956, the Bank transferred its registered office to

Karachi, where the Head Office is presently located. The bank was established with

a view to provide banking facilities to the business community of the sub-continent

purchased by a consortium of distinguished Pakistani corporate groups led by Nishat

Group. As of June 2008, the NISHAT Group owns a majority stake in the bank. The

president of the bank is Mr. Atif Bajwa (previously with Citibank). MCB is Pakistan’s

fourth largest bank by assets having an asset base of US$6.7 billion, and the largest

by market capitalization having a market capitalization of US$4.1 billion. The Bank

has a customer base of approximately 4 million and a nationwide distribution network

of 1,026 branches, including 8 Islamic banking branches, and over 300 ATMs, in a

market with a population of 160 million.

Nationalized

The performance of MCB was badly affected by bureaucrat government.

In January 1974, MCB was nationalized by Bhutto Government following the bank

act 1974 subsequently in June 1974 Premier Bank Limited merged with MCB.

PRIVATIZATION

In the late 1990 after long period of time newly established Democratic Government

of Pakistan have decided to sell nationalized assets of country for better utilization.

In April 1991 this was the first bank to privatize in 1991 and the bank was purchased

by a consortium of distinguished Pakistani corporate groups led by Nishat Group. As

of June 2008, the Nishat Group owns a majority stake in the bank. The president of

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the bank is Mr. Atif Bajwa (previously with Citibank). Founded in 1948, Nishat Group

is one of the leading and most diversified business groups in Pakistan. The group

has strong presence in the most important business sectors of the country such as

banking, textile, cement and insurance.

NEW MILLENNIUM

MCB besides being money financial organization have rendered invaluable services

in the economics and social developments of our country. MCB today, represents a

bank that has grown with time, experience and Pakistan. A major financial institution,

in scope and size, it symbolizes a fully-grown tree. Evergreen, Strong, and firmly

rooted.

PHILOSOPHY

MCB relies on strong, lasting relationship with its customers and on its reputation for

stability and security for its continued process. Its philosophy has been to adopt

steady course. It has pursued small, less risky loans to consumers and business,

and shied away from risky loans. MCB extends its philosophy to its technology

strategy but not perusing technology for technology's sake. However, MCB learns

from the mistakes of others especially in "consumer banking". We let others get in

first, take the hit, and find out the flows. Said MCB officials - and has installed

efficient and effective system for processing and delivering information.

The board of directors has the authority in guiding Bank affairs and in making

general policies. Some directors are the personnel of the MCB Bank and others are

successful businessperson and executives of other major organization. Nineteen

members are included in board of directors.

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“To be the leading financial

services provider, partnering

with our customers for a more

prosperous and secure future”.

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We are a team of committed professionals, providing innovative and efficient

financial solutions to create and nurture long-term relationships with our customers.

In doing so, we ensure that our shareholders can invest in us with confidence.

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OUR VALUES

These are the standards and principles which determine our behavior and how we

interact with our customers and each other:

1. INTEGRITY

We are the trustees of public funds and serve our community with integrity. We

believe in being the best at always doing the right thing. We deliver on our

responsibilities and commitments to our customers as well as our colleagues.

2. RESPECT

We respect our customer’s values, beliefs, culture and history. We value the equality

of gender and diversity of experience and education that our employees bring with

them. We create an environment where each individual is enabled to succeed.

3. EXCELLENCE

We take personal responsibility for our role as leaders in the pursuit of excellence.

We are a performance driven, result oriented organization where merit is the only

criterion for reward.

4. CUSTOMER CENTRICITY

Our customers are at the heart of everything we do. We thrive on the challenge of

understanding their needs and aspirations, both realized and unrealized. We make

every effort to exceed customer expectations through superior services and solution.

5. INNOVATION

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We encourage and reward people who challenge the status quo and think beyond

the boundaries of the conventional. Our teams work together for the smooth and

efficient implementation of ideas and initiatives.

AWARDS & ACCOLADES

Euro money Awards

Best Bank in Asia Award 2008:

MCB has been awarded as a Euromoney Award 2008 for the " Best Bank in Asia".

Best Bank in Pakistan Award 2006:

MCB has yet again received the esteemed Euromoney Award for the “Best Bank in

Pakistan”. It is the only bank to receive the Euromoney Award for Excellence for the

sixth time in the past seven years.


MCB has again received the esteemed Euromoney Award for the “Best bank in

Pakistan”. It is the only bank to receive the Euromoney Award for Excellence for the

fifth time in the last six years.


In a continuous winning streak, MCB once again takes pride in being conferred with

Euromoney's prestigious award of excellence, for being the "Best Bank in Pakistan"

for the fourth time in the last five years.


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MCB believes in you. Together we work with quality, integrity and dedication, striving

to achieve collective success by understanding changing trends and assimilating into

diverse cultures. Your trust in our ability and our commitment to deliver has again

won us the Euromoney Award 2003 for the "Best Bank in Pakistan".


Your trust and our commitment is always an award wining combination MCB was

awarded as a Euromoney Award 2001 for the “Best Bank in Pakistan".

Best Domestic Bank Award 2000:

MCB was awarded as a Euromoney Award 2000 for the “Best Domestic Bank in

Pakistan".

Asia Money Awards

The Best Domestic Commercial Bank Award 2005:

MCB Continues to shine as once again Asia Money declares MCB as "The Best

Domestic Commercial Bank in Pakistan" for the year 2005.

The Best Domestic Commercial Bank Award 2004:

MCB has a distinction of winning the Asia Money 2004 award for being "The Best

Domestic Commercial Bank in Pakistan".

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COMPLIANCE STATUS

Name & Address MCB Bank Limited MCB 15 Main Gulberg, Lahore

Legal FormPublic Limited Company. Listed on Karachi, Lahore & Islamabad Stock Exchanges in Pakistan.

Name of External Auditors

KPMG Taseer Hadi & Co / Riaz Ahmed & Co . Chartered Accountans

Name of Regulatory Body

State Bank of Pakistan (Central Bank).

Main Banking Commercial, Consumer, Corporate, Correspondent and Islamic Banking.

Categories of shareholders - as of December 31,2007.Pattern of Share Holding

Particulars Shareholding Percentage Directors, CEO and children 29,414,134 4.6817 Associated Companies 49,601,842 7.8949 NIT & ICP 7,305 0.0011 Banks, DFI & NBFI 3,941,990 0.6274 Insurance Companies 39,538,161 6.2931 Modarabas & Mutual Funds 2,153,414 0.3427 Public Sector Cos. & Corp. 115,204,125 18.3365 General Public (Local) 143,491,134 22.8388 General Public (Foreign) 2,127,329 0.3385 Others 83,306,246 13.2594

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Foreign Companies 159,491,163 25.3854 Company Total 628,276,843 100.00

Chairman Mian Mohammad Mansha

Mr. Atif Aslam BajwaPresident & CEO

Banking License No. BCD (1) 17-66 dated 8th December 1966.

Compliance StatusCompliant with KYC and AML regulations prescribed by State Bank of Pakistan.

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CORPORATE PROFILE

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ORGANIZATIONAL STRUCTUREThe organizational structure of MCB is Functional, as all activities are grouped

together by common functions from the bottom to the top of the organization.

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VP

EVP

SVP

AVP

GRADE-1

SEVP

CHAIRMAN

VICE-CHAIRMAN

PRESIDENT &

CHIEF EXECUTIUVE


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GRADE-2

ASSISTANTS

CLERICAL STAFF

1. CASHIER2. TECHNICAL

STAFF

NON-CLERICAL STAFF

1. MESSENGER2. DISPATCH RIDER

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BRANCH HIERARCHY

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OPERATION

AREA

MANAGER

OPERATION

MANAGER

Branch

Manager

AREA

MANAGER

Advance

sDept.

Account

s Dept.

Remitta

nces

Dept.

Date

base

Admins

Dept.

Acc.

Opening

Dept.

Cash/

Deposit

Dept.

Consum

er

Finance

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BRANCH NETWORK

As Of 15-07-2008

COMMERCIAL BRANCH BANKING GROUP

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HEAD OFFICE AT GLANCE

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I. I. Chudrigor Road of Karachi has same importance in Pakistan’s economy as of

the Wall Street in world economy. The divisions working under MCB Head office are

as follows:

Administration

Credit Management

Investment Banking

Human Resource

Information Technology

Corporate Planning & Budgeting

Finance & Treasury

International Division

Inspection & Audit

Law Division

Marketing & Development

Trustee Division

Under the President an Executive Committee and a Credit Committee works. All the

matter of the bank join to the board of director are presented to the executive

committee which is responsible for daily operation of the bank .The request for credit

exceeding the General Manager power is approved by the Credit Committee. Under

the area Executive is the General Manager who is the in charge of the Circle Office.

Under the General Manager is the Zonal Manager and then the Branch Manager. At

present, there are 9 circles, 47 regions and 1400+ branches. Before privatization

there were provincial chiefs for all the four provinces. But this management now has

abolished the provincial officers and improved the efficiency of the bank.

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CIRCLE OFFICE

The working of circle office is to control and regulate the functions of branches which

are under in its control. The functions of circle office are to mobilize the deposits and

receive reports from branches. Circle office is like a mini head office. Agents and

correspondents of MCB are in all commercial cities of the world. Circle office is

divided in the following division:

Credit Management

Audit & Inspection

Human Resource

Marketing & Development

Province Circles Region Branches

Punjab 9 27 823

Sindh 5 12 278

Balochistan 1 2 35

NWFP & AJK 2 7 235

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PROMINENT FEATURES

SBP allowed exporters obtain foreign currency loans against firm contracts L/Cs and

MCB made arrangements for clients to use the facility at EPZ branch, Karachi and

off-Shore Banking Unit, Bahrain for the purpose. It also offered services to clients for

procuring foreign currency loans from abroad.

The other significant development is the launching of the MCB Imdad-e-Bahami

Scheme for “Housing Improvement” in addition to commercial lending; MCB has

accepted the responsibility to offer social lending. The scheme, launched with the co-

operation of the Swiss institution aims at providing easy credit to low income group is

urban areas to improve their living condition. Other Prominent features are as follow:

Committee Structure Organizational culture Customer Service Automation & Modernization International Appearance Employees Mgt Relation Human Resource

COMMITTEE STRUCTURE

MCB employs a very strong committee structure to oversee decision by

decentralized operations. Officers are given strict limit to authority. Within prescribed

limit, officers do indeed make their own decision- but according to guidelines,

procedures, and rules. Decision outside of prescribed limits is taken to high-level

committees.

ORGANIZATIONAL CULTURE

Officers of the bank don't need to spend a lot of time into whether they should

consider issues or ideas. They just know their certain parameters beyond which they

won't go.

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The employees in the organization are well dressed, well communicated and well co-

operative.

Officers learn what these parameters are through their experience with various

committees through process osmosis. In visiting and in participating on committees,

individuals get to see what their cohorts are doing. Cross - fertilization of ideas

occurs and, often, morale is helped. Major corporate policy changes occur through a

process of involvement by levels of management.

CUSTOMER SERVICE

Perhaps the most important yardstick for testing the success oriented organization is

in the area of customer services and it is in this very sphere that MCB have made

the leading strides. To eliminate delays in dealing with credit proposals, of which

complaints were frequent is the past, an effective three lier system was introduced

instead of six lier system. Under this new system adequate sanctioning powers were

delegated to Branch, Regional and General Managers and also to the senior

executives in charge of credit at the Head Office. Only proposals exceeding their

powers are now considered in the credit/executive committee.

As a part of the new system, the role of the Head office was redefined from

supervisory to supporting only the inspection division at the Head Office now has a

supervising role for ensuring the implementation of the Bank’s Directives.

The new policy and the restructuring of the system had a two fold positive outcome.

Customers were provided improved services and needed facilities. The Bank’s

executives and other staff come to possess a new sense of confidence and dignity in

their jobs.

Automation & Modernization

The project of on line banking has been successfully introduced and provides

customer with the facility to operate from any branch in the network, so for, more

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than 80 branches have been connected to the MCB Data Network between/among

Karachi, Lahore, Rawalpindi, Hyderabad, Multan and Islamabad.

The bank has installed a number of Automated Teller Machines (ATM) to provide 24

hours cash facility to its customer. ATMs have been installed at 40 branches in

Karachi, Lahore and Islamabad. The network have been expanded to Multan and

Faisalabad since 1997. The ATM at Karachi airport has also started functioning and

those at Lahore and Islamabad airport have been inter-linked in 1997.

Swift

The bank has also started replacing conventional telex messaging system for fund

transfer, L/C opening etc., by connecting on-line with the world wide interbank

Financial Telecommunication Network (SWIFT). So for, MCB has on line 20

branches in Karachi, Lahore, Faislabad, Gujranwala and Sialkot on SWIFT, to meet

foreign correspondence requirement.

Human Resource

The bank has five special importances to the aspect of training and career planning

of its staff members. Forwards this main objective, several training courses have

been organized initiating a self development process, in order to accelerate

organizational growth and to further improve the Bank’s level of expertise and

efficiency.

In 1998, a total of 576 courses were conducted which covered a wide variety of

topics connected with banking and customer services. An aggregate numbers of

8,776 staff member participated.

Additionally 245 officers and executive took part in training courses and seminars

conducted by professional institution, such as institute of Bankers Management

Association of Pakistan, Pakistan Institute of Management and Pakistan Banking

Council. Eight executive also participated in courses conducted is foreign countries.

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The MCB executive development centre, set up in November, 1995 for used

attention an the development and grooming of our executives. Eminent scholars and

specialists were invited, during 1996, to apprise our executives of new concepts and

techniques to keep abreast of the constant changes taking place locally and globally.

A total of 54 seminars were held this year in which 518 executive participated.

International Appearance

After the closing down of the London operations prior to privatization, MCB was left

with no foreign branches and operations. In 1994 as planned the bank opened up its

international operations by inaugurating its branches in Dakha and Colombo. More

branches are operating in Pettah, Srilanka and Chittagang. Access to Middle East

and Africa is in progress.

Employees Management Relation

The employee management relations remained cordial. Up-to-now more than 290

offspring of the employees are inducted in the bank as cashier and typists on merit

basis. Extensive training PROGRAMME for the employees continued to supplement

their capabilities.

The management is indebted to the employees for sharing its vision and dream to

make MCB the best Bank of the country that is client driven, preferred by the

customers and tested on the touch- stone of customer satisfaction.

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SERVICES

We make every effort to exceed customers’ expectations through superior and wide

array of financial services and solutions. We thrive on the challenge of understanding

their needs and aspirations, both realized and unrealized, so that we can satisfy then

with surety and security.

The privatization process for the expansion and diversification of economic

activities in the country also demanded the introduction of new banking

products. MCB took initiative in this direction and for the first time MCB

devised and marketed new products and services with brand names to enter

the varying requirements of its diverse customers. MCB currently have

following products or services in banking sector that are making it more

prominent in the banking sector:

Night Banking

Fax Utility

Consultancy Services

Traveler Cheques

Self Supporting Scheme

Utility Bills Collection

Credit Cards

ATM

CONSULTANCY SERVICES

In the process of privatization of public sector units, prospective buyers need

professional assistance and MCB, with its expertise offers to their specialized

service for valuation of the market value of the industrial unit, preparing bid

documents and arranging finance for the purchase of the unit.

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SELF SUPPORTING SCHEME

Loan for poor/needy people

No mark-up charged

Maximum amount of Rs. 25,000/=

Minimum amount of loan Rs. 5,000/=

FAX utility

Pioneer to introduce Fax for customer service.

Facilitates speedy transfer of funds.

Within an hour any where in Pakistan.

Charges are debited to Customer account.

NIGHT BANKING SERVICES

To facilitate business community

Only in commercial trades centers premises

Clients can make deposits up to 8:00 pm

Date moved to next for all such transaction

MCB RUPEE TRAVELERS CHEQUE

Can be a safest way to carry cash

Cheque is accepted at trade centers & branches

No need to be a/c holder for traveler cheques

Cheque is signed once when issued.

Upon delivering second signed are made

In case of theft no fair to Ancash

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MCB ATM SERVICES

MCB ATM Card

Welcome to a world of convenience

with the MCB ATM 24- Hour Smart

Card. "It Works anytime in Pakistan

and abroad." With an ever growing

number of ATMs operating across

the nation, the MCB ATM Network is

the largest and most advanced of its

kind in the country, and is part of

MCB's continuing efforts to provide

you with convenience that suits your

requirements most. And now the

MCB ATM has gone global. MCB's

affiliation with Master Card

International brings about added facilities for the MCB traveler abroad with the Cirrus

and Maestro networks. So go ahead! Use your MCB ATM 24- Hour Cash Card day

or night, at home or abroad.

Card Categories

MCB ATM Regular Card

The MCB ATM Regular Card allows withdrawal of up to Rs. 10,000 per day and a

maximum of 3 withdrawals per day per card.

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MCB ATM Gold Card:

The MCB ATM Gold Card allows withdrawal up to Rs. 25,000 per day and a

maximum of 6 withdrawals per day per card. The cardholder has to make at least

two transactions to withdraw the full amount of Rs. 25,000.

Schedule of Charges

Gold Classic

Joining Fee FREE FREE

Annual Fee FREE FREE

Chip Maintenance Fee upto PKR. 500 p.a upto PKR. 350 p.a

Supplementary Annual Fee FREE FREE

Supplementary Chip Maintenance Fee PKR. 300 p.a PKR. 300 p.a

Service Fee/Markup on Cash Transactions2.83% per month translated into an APR of upto 34% calculated on daily unpaid balance from date of transaction

Service Fee/Markup Retail(Fixed APR)2.83% for service fee/markup per month translated into an APR of upto 34%

Service Fee/Markup Retail (Variable APR /i-revolve)Upto 35% to 30% APR based on continuous revolving of per retail transaction for six months or above

This is charged on per retail transaction basis from an APR of 35% in the first revolving month and based on revolving of the transaction the rate continues to decline each month for six months to a minimum of 30% i.e sixth revolve month and continues at this rate till the transaction is fully paid.

Month

APR (upto) Per Month

1 35% 2.91%

2 34% 2.83%

3 33% 2.75%

4 32% 2.66%

5 31% 2.58%

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6 and beyond till the transaction isnot fully settled

30% 2.5%

Late FeeRs.600/- or 10% of minimum amount due which ever is higher

Cash Advance FeeRs.500/- (per transaction) or upto 3% of the cash advance transaction amount (whichever is higher) plus all charges passed on by the acquiring bank

Cheque/Cash Pickup FeePKR. 200/-

Overlimit FeePKR. 500/ -

Voucher Retrieval FeeLocal: PKR. 250/- per document Foreign: PKR. 800/- per document

i-insurePackage 1: PKR 600,Package 2: PKR 300,Package 3: PKR 200,Wallet Protection: PKR 75 per month

Credit Securityupto 0.40% of total monthly outstanding balance

i-planAPR Starting from 17.93% upto 21.28%Processing Fee: PKR. 250/- per transaction Prepayment Charges: PKR. 500 or 5% of outstanding installment balance (whichever is higher)

i-dialAPR Starting from 17.93% upto 21.28% Processing Fee: Bank remittance charges plus PKR. 350 (per request) or upto 3% of amount requested (whichever is higher) Prepayment Charges: PKR. 500 or 5% of outstanding installment balance (whichever is higher)

i-switchAPR Starting from 17.93% upto 21.28%Processing Fee: Upto 3% of transferred amount or PKR. 350/- (whichever is higher)

Arbitration Charges for Disputed TransactionsUSD 500/- or equivalent

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Card Replacement FeePKR 500 for Gold, PKR 350 for Classic and PKR 300 for Supplementary

Cheque Return Charges / Insufficient funds on Auto DebitUpto PKR. 600/-

Pay Order / Demand Draft Issuance FeeUpto PKR. 500/-

Cash Payment Processing FeeUpto PKR. 100/- per bill for MCB account holdersUpto PKR. 200/- per bill for non-MCB account holders

Duplicate Statement of RequestPKR. 300/- per statement (more than 1 month old)

Foreign Transactions5% over prevailing market rate or as per SBP directive. Third currency transactions will be first converted into US Dollars as per rate quoted under arrangement with Visa. Cross border transaction fee will also be charged as per Visa rules

Credit Worthiness Certificate1 Certificate per 6 months – Free Subsequent requests - PKR. 200/- per certificate

Supplementary Chip Maintenance FeePKR. 500/- per cheque

Plan Conversion FeeUpto PKR 200

All the charges are subject to change in rate which will be at the discretion of the Bank and will be notified to the customer accordingly.

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BILL PAYMENTS

About MCB Bill Payments

MCB easy bill pay offers unmatched convenience to pay your utility and mobile

phone bills or re-charge your prepaid mobile phone accounts anywhere, anytime

with security and peace of mind. MCB is the only bank that offers you 3 convenient

options of making bill payments to PTCL, SSGC, SNGPL, KESC, Instaphone,

Mobilink, Paktel and Ufone. So, save your precious time by avoiding long queues

and pay your bills through MCB Easy Bill Pay. MCB Smart Card or MCB ATM Card

Holder can easily pay their bills or re-charge their prepaid mobile phone account

through the following convenient options of MCB easy bill pay.

Bill Payments Features

allows you to :

MCB's Partners in

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Pay your bills 24 hours a day 7 days a week.

Make total payments of up to Rs. 20,000 per day.

Carry out up to 10 transactions per day per card.

Make either full or partial payments. Full payment is required for PTCL only.

Recharge your pre-paid account for Ufone, Instaphone and Paktel as per their

fixed slabs.

Pay as a registered or non-registered user. Registration will help you avoid

the time delay in entering details each time you carry out a transaction.


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GENERAL BANKING

It is backbone of banking It is one of the major department of MCB. It consists of

following departments:

Accounts Department

Current Department

Remittance Department

Clearing Department

Cash Department

Financing Department

ACCOUNTS DEPARTMENT

Every transaction which takes place recorded in the computer so all transactions in

different departments are forwarded to account department. Since all vouchers from

different departments are forwarded to current department so this department tallies

all such transactions with current department after maintaining the ledger of each

department. Following are different functions performed by this department:

Preparation of Financial Statements for different time span

Maintain all accounts of different departments

Calculation of profit on different schemes

Calculation of markup on different advances

Preparation Different types of reports for State Bank

Daily position of cash & every accounts

Matching daily summaries of all departments with ledger

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CURRENT DEPARTMENT

This department maintains all formalities of the accounts and account holders like it

account name, account holder’s name, code number and full address. Different

cheques debit and credit voucher come form different departments like Token,

Clearing, Remittances, Cash, Foreign Exchange, Advances and posted against

different accounts.

A working Journal called Manual is prepared daily which shown the balance

accounts of all parties. Mark-up and profit are calculated daily. That would be debited

at credited from or to account holder’s account after specific period of time.

Markup is debit from the account after every three month profit is credited to

accounts after every six month. New accounts are also opened in this department.

The fund deposited in the MCB bank can be classified under the main heads:

Current account

Saving account

Term /call deposits

ACCOUNTS TYPES

Though in theory there many types of accounts but commonly account operators can

be classified in one of the following categories, each have different documentation

requirements:

Single

Joint

Partnership

Private Limited

Public Limited

SINGLE

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Only one person can operate this a/c. An individual who can fulfill the requirement of

bank can open this a/c. We can call it a personnel or individual a/c. The

requirements for this type are National Identity Card Photocopy, Minimum Deposited

Balance, Account Opening Form, Letter of Kinship etc.

JOINT

In case of joint a/c applicant mentions that how much person will operate the a/c.

Instruction are given for joint a/c such that the account shall be operated by anyone

or more. The requirements for this type are National Identity Card Photocopy,

Minimum Deposited Balance, Account Opening Form, Letter Kinship, Additional

Signature Form (For Joint Account), Declaration regarding the operator of account.

PARTNERSHIP

For partnership a/c, along with the application form other requirements needs

satisfied. The requirements for this type are National Identity Card Photocopy,

Minimum Deposited Balance, Account Opening Form, Registration certificate,

agreement among partners and Commencement of business and private

registration, resolution of board of directors, commencement of business,

memorandum and articles of association and balance sheet etc.

PRIVATE LIMITED

Such type of account is opened in the name of the businesses having private limited

concern and mostly medium business enterprises open such kind of accounts. All

the board of directors have to submit the declaration regarding the account operator

on the company pad and with the rubber stamp with the signature of the all the

members of the board of directors. In case of any change in directors bank must be

informed regarding that. In case funds are borrowed by the company all the directors

approval is necessary rather not only the authorized partner who can be the operator

of the account.

PUBLIC LIMITED

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Public Limited A/C type of account is opened in the name of the businesses having

Public limited concern and mostly medium business enterprises open such kind of

accounts. All the board of directors have to submit the declaration regarding the

account operator on the company pad and with the rubber stamp with the signature

of the all the members of the board of directors. In case of any change in directors’

bank must be informed regarding that. In case funds are borrowed by the company

all the directors approval is necessary rather not only the authorized partner who can

be the operator of the account.

ACCOUNT OPENING

To open an account the customer have to meet the general banking manager with

an introducer (the person who is going go introduce that person in the bank) and get

an application form used for account opening. Different color-coded application

forms are available for each type of account. Along with the form a card for

specimen signature is also supplied to customer. Manager has every right not to

accept this contract if he is not satisfied by the details provided by the customer. In

case the contract is acceptable to both, now it is ready to open the account formally.

Procedure

The procedure begins with the punching of account opening form to the customer file

i.e. customer’s master file. The manager records the necessary details into this

register and allots an a/c number from this a/c opening register. This register is

maintained for each type of account and the a/c no’s are allotted serially. After

opening a saving and current account every applicant’s data is entered into the

computer to maintain a safe record and application form is properly filled so that it

can be available when necessary. Checking officer is responsible to Tele the manual

application form with the computerized a/c opening file. For fixed deposit only that

application form is needed this is prepared manually, because most of the procedure

of fixed deposit is done manually. The signature specimen card contains three

signatures of an applicant, applicant a/c no, a/c type, branch code, title of a/c, it will

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be attached with an application form. Banker uses this card at the time when he

receives the cherub; he compares customer’s signature with the signature on the

cherub for avoiding fraud.

ACCOUNT CLOSING

There are no. of reasons of closing an account can be one of the following if

customer desire to close his account, in case of death of one account holder,

bankruptcy of the account holder and If an account contain nil balance or not up to

the requirement of rules.

Before closing any account, bank send letter to the account hold for informing him

that his account is going to be closed. There is need an approval form higher

authority to close any account.

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ACCOUNTS

Pak Rupee Accounts

Saving Account

MCB’s Rupee Savings account is the most convenient way to manage your

savings.

Low average balance requirement

Enjoy unlimited free of cost transaction facility at your branch

Profit is paid on your account on a half yearly basis

Cash deposit and withdrawal facility at hundreds of MCB branches across

Pakistan (conditions apply)

Withdraw cash through Pakistan’s largest ATM network.

Make cash free transactions, from your account at thousands of merchant outlets

through your MCB Smart Card (local & international)

Stay in touch with your account through MCB’s Virtual Banking Service.

Use your account to pay your bills 24 hours a day, 7 days a week through Virtual

Banking

Get instant updates about your account through MCB’s sms banking

Current Account

Low average balance requirement.

Enjoy unlimited free of cost transaction facility at your branch.

Profit is paid on your account on a half yearly basis.

Cash deposit and withdrawal facility at hundreds of MCB branches across Pakistan

(conditions apply).

Withdraw cash through Pakistan’s largest ATM network.

Make cash free transactions, from your account at thousands of merchant outlets

through your MCB Smart Card (local & international).

Stay in touch with your account through MCB’s Virtual Banking Service.

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Use your account to pay your bills 24 hours a day, 7 days a week through Virtual

Banking.

Get instant updates about your account through MCB’s sms banking.

Term Deposit

MCB offers a wide range of attractive term deposit schemes to suit your

requirements.

Avail your choice of 1 month, 3 months, 6 months, 1 year, 2 years, 3 years, 4

years and 5 year term deposits.

Low investment threshold.

Half yearly profit payment.

Avail a credit facility up to 75% of the total deposit value.

Special Term Deposit

MCB’s Special Rupee Term deposits offer a very attractive long term

investment option with ease and convenience.

Highly attractive profit rates.

Tenors available are 3 months, 6 months, 1, 3 and 5 years.

Profit on 3 and 6 months deposit is payable at maturity of deposit.

Profit on 1, 3 and 5 years deposit is payable quarterly.

Withdraw your amount through our wide network of ATMs.

Avail a credit facility up to 75% of the total deposit value.

Contact your branch for information on the present profit rates on offer.

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Foreign Currency Accounts

Saving Accounts

MCB’s Foreign Currency Savings Account offers you attractive returns on your

Foreign Currency investment.

Open a foreign currency Savings account in any of the four currencies i.e. US

Dollar, UK Pound Sterling, and Euro.

Unlimited transaction facility.

Low balance requirement.

Profit credited to your account on a half yearly basis.

You can avail a credit facility up to 75% of the total deposit value.

A foreign currency account can be opened at any of our foreign exchange dealing

branches.

Current Accounts

MCB’s Foreign Currency Current Account offers you the convenience of

unlimited withdrawals i.e. access to your funds whenever you want without

any notice. There is no limit on the number of transactions you make in a day.

Open a foreign currency Current account in any of the four currencies i.e. US

Dollar, UK Pound Sterling, and Euro.

Unlimited transaction facility.

Low balance requirement.

You can avail a credit facility up to 75% of the total deposit value.

A foreign currency account can be opened at any of our foreign exchange dealing

branches.

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REMITTANCE DEPARTMENT

The need of remittance is commonly felt in commercial life particularly and in every

day life general. A major function of any banking system is the transfer of funds from

one client or one place to another. By providing this service to the customer the bank

earns a lot of income in the form of service charges. This department deals with local

currency remittance i.e. remittance from one city to another without actually carrying

the currency. MCB uses following instrument for transferring of money:

Demand Drafts (DD)

Pay Order (PO)

Telegraphic Transfer (TT)

Mail Transfer (MT)

Demand Drafts (DD)

DD is a written order given by the branch of the bank on behalf of the customer to

other branch of the same bank to pay the certain amount to the customer. DD are

issued for the particular place other than place of issuance. A draft is a Cheque

drawn by a bank on its own branch or any other branch of another bank at a different

place requesting it to pay on demand a specified amount of money which is already

received to the person named on it. DD is of following two types:

DD payable

DD Paid Suspense a/c

In the first type as advice reaches for payment the immediately pay to the customer,

while in later as DD presented by the customer, it is paid and the suspense account

is debited.

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DOCUMENTATION

A printed application form is provided for filling in completely and signing by the

applicant. After depositing an amount of draft and commission of the bank, duly

completed and signed by two authorized officers, then it is handed over the applicant

and credit order is dispatched to drawee branch. Following are the pre-requisites for

the processing of DD:

Bank Serial No

No. of DD

Central No

Test Key

Postage charges

With holding tax

Pay Order

For this kind of remittance the payer must have the account in the issuing bank. Pay

order are more liquid as compared to cheques because cheques may be dishonored

while PO can’t be. It is written order issued by the bank drawn and payable on itself.

It is used for local transfer of money from one person to another person. It is also

used by the public for depositing money with Government or Semi Government

department.

DOCUMENTATION

The party who requires a pay order will get a printed application from the bank. He

will fill it and deposits the amount and commission. The bank charges are same as

on demand draft.

Bank Serial No.

No. of PO

Central No.

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With holding tax

TELEGRAPHIC TRANSFER (TT)

In this case the authority is given from one bank to other on the behalf of the

customer through telecommunication to debit their inter office account through them

and credit their parties account mentioned in TT. It is an inter bank transaction.

Telegraphic transfer is an instant transfer of funds. Through this method applicant

can transfer money from one place to another place. There are two types of TT, Both

types of TT are maintained in separate registers, test is applied by the manager of

every amount of TT.

Incoming TT

Outgoing TT

Applicant has to fill a form along with depositing amount to be transferred and bank

commission. MCB charges the commission at the same rate as in the case of

demand drafts.

Documentation

Issuing Branch Name & Code

Beneficiary Branch Name & Code

No. of TT

Rs 20 Postage and Rs 180 for Fax

Amount in words & Figure

With holding tax

Test key

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Mail Transfer (MT)

As the name shows, it is transfer of money in the shape of document through mail.

Procedure is like TT. The transfer of funds from one place to another by mail is

called Mail Transfer (MT). The MT can be foreign or domestic. The applicant who is

desiring to remit the funds by way of Mail Transfer can either deposit cash or ask the

bank to debit his/her account with the cost of MT including the bank charges. These

all measures are for safe transfer of funds.

Documentation

Issuing Branch Name & Code

Beneficiary Branch Name & Code

Number of MT

Amount in words & Figure

With holding tax

Test key

CASH DEPARTMENT

In cash department both deposits and withdrawals go side by side. This department

works under the accounts department and deals with cash deposits and payments.

This department maintains the following sheets, books, ledger of account:

Cash received voucher sheet.

Cash paid voucher sheet.

Paying-in-slip

Cheque Book

Cash balance book

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Cash Paid Sheet

The only instrument that can be used to withdraw an amount from an account is the

Cheque book. No payments are made by another instrument. Cheques can be of

two types, they may be presented at the counter and encashed and the others are

clearing or transfer cheques. Cashier manually inspects the Cheque for following

Signature & date

Cross cutting

Drawee’s a/c title

Amounts in words & figures

Two signatures at the back

Cash Received

For depositing the cash into customer’s accounts, there is need to fill in the paying-

in-slip giving the related details of the transaction. This paying-in-slip contains the

date, a/c/no, a/c title, particulars, amount being deposited and details of the cash.

There are two portion of the paying-in-slip. The depositor signs the one part of the

paying-in-slip one is retained by the bank to show an acceptance of the entries made

in the slip. The different colored paying-in-slip is used for all the types of deposits.

Only the slips related to a particular type of a/c is acceptable by the bank. The

transaction ledger is only updated by paying-in-slip and Cheque. The cashier is

responsible to receive both the paying-in-slip and cash from the depositor.

CASH BOOK BALANCE

At the end of the working day cashier is responsible to maintain the cash balance

book. The cash book contain the date, opening balance, detail of cash payment and

received in figures, closing balance, denomination of government notes (Currency).

It s checked by manager. The consolidated figure of receipt and payment of cash is

entered in the cash book and the closing balance of cash is drawn from that i.e.

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Opening Balance of Cash + Receipts - Payments = Balance

The closing balance of today will be the opening balance of tomorrow. This

department is one of the most important departments of the bank. All the books

maintained in this department are checked by officer.

CLEARING DEPARTMENT

Clearing is a system by which banks exchange cheques and other negotiable

instruments drawn on each other within a specified area and thereby securing the

payment for its clients through the clearing house. A clearing house is a general

organization of the banks at a given place, its main purpose is offsetting the cross

obligation in the form of cheques. When there are many banks in the country each

will receive a number of cheques drawn on other banks, deposited within for

collection. A clearing house is an organization where these cheques are brought and

the mutual claims of each bank on the other are offset and a settlement is made by

the payment of differences. The representatives off all the banks in Pakistan attend

office of the bank which is performing these duties of clearing house, on each

business day at a fixed time. They deliver cheques that their bank may have

negotiated and receive in exchange cheques drawn on their bank negotiated by

other bank. The responsibility of smooth cooperation of the clearing function lies with

the State Bank of Pakistan.

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FINANCING DEPARTMENT

It is another major department of the MCB Bank. Bank provides this facility to the

people who need advance money to meet their requirements.

AGRICULTURE SECTOR FINANCING

MCB is financing agriculture sector since 1973. Due to large branch network and

specialized staff posted in the branches, MCB caters to the financing requirement of

the farming community spread through out the country and facilitates in achieving

increased productivity.

MCB has reinvigorated its agri financing products under the brand name MCB Green

Scheme. The scheme is designed and aimed at meeting all types of financial needs

of agriculture sector covered under extended list of eligible items. Agri financing

facilities are available through out the country at designated Lending Branches. All

types of financing is available for short, Medium and Long term depending upon

farmers choice and the nature of finance. MCB gives top priority to small & medium

size farmers so that they could be protected from the exploitation of private money

lenders.

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AGRI FINANCING PRODUCTS

SHADABI PLAN (AGRI REVOLVING FINANCE)

Shadabi Plan caters the financing needs for production activities on the farm which

mainly include seed, pesticides and fertilizers along with provisions for

miscellaneous expenses like payment of electricity & diesel bills of tubewells,

maintenance expenses for tractors and the like items as per list of Eligible items.

Salient Features

Financing requirement is ascertained for a period of three years

Limit is sanctioned for three years on revolving basis with one time documentation

subject to annual clean up along with markup.

55

http://www.mcb.com.pk/agriculture/shadabi_plan.asp

http://www.mcb.com.pk/agriculture/khushali_scheme.asp

http://www.mcb.com.pk/agriculture/tractor_finance.asp

http://www.mcb.com.pk/agriculture/aabiari_scheme.asp

http://www.mcb.com.pk/agriculture/grower_finance.asp

http://www.mcb.com.pk/agriculture/dairy_meat.asp

http://www.mcb.com.pk/agriculture/murghbani_scheme.asp

http://www.mcb.com.pk/agriculture/baghbani_scheme.asp

http://www.mcb.com.pk/agriculture/mahigeri_scheme.asp


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Mark up is charged on the limit amount utilized by the farmer

There is no prepayment penalty

There is no hidden cost involved

Forms & documents are provided free of cost.

KHUSHALI SCHEME (AGRI DEVELOPMENT FINANCE)

Under Khushali Scheme loans/finances are allowed for farm/non farm credits which

include fixed investments/working capital requirements. Amount of finances

sanctioned depend upon the credit requirement and collateral.

Financing for land leveling/development, heavy equipments, agriculture machinery,

vehicles/transport for agri purpose are covered under this scheme. There may be

other development projects proposed by the farmers falling with in the ambit of agri

financing, which can be considered under this scheme.

Salient Features

Short, medium and long term financing facilities are extended

The repayment is scheduled on the basis of farmers convenience on annual/

biannual basis.

TRACTOR FINANCE SCHEME

To boost up the mechanized farming in the country, Tractor Finance Scheme

is introduced to offer specialized services to farmers. Under this scheme,

there is no requirement of minimum land holding because of multipurpose use

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of tractor for agriculture cum commercial. However, the repayment capacity

and potential use of tractor will be evaluated at the time of loan processing.

Salient Features

All types & makes of tractors either locally manufactured or imported can be financedTractor is financed for a period of five years or earlier as per farmers choice

Installment is on biannual basis.

Comprehensive insurance is required to be intact during the tenure of finance

Tractor will be jointly registered in the name of the borrower and the bank.

Tractor will remain hypothecated in banks favour till the loan is repaid in full

Security/collateral will be required as per bank policy.

AABIARI SCHEME

Under the Aabiari scheme, financing facilities for tube well, other wells, irrigation

systems of all types including sprinklers are covered. The purpose is to facilitate the

farmers in overcoming the shortage of water for cultivation/plantation since water is

essential requirement for crops.

Salient Features

The requirements may differ from farmer to farmer.

Evaluation/assessment of finance will be made on case to case basis.

The finance will be for a period to be determined on the basis of assessment

Repayment of the loan will be on biannual basis or linked with crop cycle

Three quotations will be required in case of machinery to be installed

GROWERS FINANCE

Grower Finance is a unique way of financing registered/(bonafide) growers/farmers

of sugarcane, cotton and rice(mills). The special characteristic is that the financing

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facilities are extended to farmers against the Mill/Factory guarantee. Fixed/floating

charge may be created on the Mill's assets and the loan is disbursed directly to the

growers. This finance is short term in nature but the tenure may extend to eighteen

months in case of growers of sugarcane.

Salient Features

The grower should have his account opened in MCB Branch

The BOD of the Mill should pass a resolution for financing request addressed to

MCB

The charge over the assets of the company is created

KYC requirements are complete

Growers crop is hypothecated

Repayment of the loan is linked with crop harvesting

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ISLAMIC BANKINGThe thrust for Islamic Banking is founded on the desire to submit to the Divine

Instructions on all transactions, particularly those involving exchange of money for

money. However, it would be quite unfair to limit Islamic Banking to elimination of

Riba only. At the heart of Islamic Banking is a system of commercial transactions

that not only provides Halal modes of commercial transactions by avoiding that

which is obnoxious and objectionable, but also fosters ethical, fair and just practices.

A key element of Islamic economics is distribution of equitable rewards to the

different factors of production. Islamic economic system seeks system of

Redistributive justice where concentration of wealth in a few hands is countered and

flow of money into economy is fluent. Islamic Banking is, therefore, seen as a

lynchpin to achieving the economic and social goals of the Islamic economic system.

"The credit would go to MCB for establishing first dedicated Islamic branch in

Pakistan. Besides, the Islamic Banking Division (IBD) established a full-fledged

Advisory Board for Islamic Finance, headed by Rashid Rehman, which is working

since January 1, 2003.

DEPOSIT SCHEMES

If you are looking for a deposit opportunity where you can purse your funds and reap

HALAL returns, we offer following products:

Al-Makhraj Saving Account

The minimum deposit requirement for Al-Makhraj Saving Account is only Rs.

10,000 and profits can be earned 6-monthly. Other features associated with

this product are as follows:

1 Minimum Deposit: Rs. 10,000

2 Minimum Monthly Balance: Rs. 10,000

3 Islamic Tools used in designing the product: Mudaraba/ Musharaka

4 Product to be availed by: Individuals & Joint Account Holders (Local and

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Foreign), Companies, Corporate, Trusts, etc

5 Special Advantages:

a For Customer = Bi-Annual Profit Payment; Withdrawal Facility

b Shariah = Meets requirements for Shariah Compliance

6 Additional Features:

a Personalized Cheque books

b Withdrawal Facility from ATM

c Online deposit/ withdrawal facility as per bank's policy

d Debit card

e Utilities payment via ATM card

f Mobile Banking

g Call center facilities

h 6-monthly profit payment

i Free bank balance certificates (once in 6 months)

j Taking stop payment/ hold mail/ standing instructions

k Issuance of duplicate statement of account (as per Schedule of Charges)

lPersonal financial consultancy services (regarding Shariah Compliant

products)

m Choice of statement frequency (as per Schedule of Charges)

7 Balance for Profit Calculation: Monthly Average Balance

8 Frequency of Announcements: The first announcement shall be made at the end

of December 2003)

9 Profit Payment Options: 6-Monthly

10 Weightages: Initially single weightage for product; Later weightages can be made

according to tiers (Volume-wise)

11 Communication Process: Announcement on notice boards, and website

12 Banking Network: IBD's Branch only

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IANAT Account

For customers who are looking for a chequing account that gives them the ease of

doing unrestricted number of transactions, we offer Al-Makhraj Ianat Account. With a

minimum of only Rs. 10,000, Ianat Account may be opened. With all the features

and facilities that this product offers, it is highly recommended for management of

business funds.

Details of the product are as follows:


2 Minimum Monthly Balance: Rs. 10,000

3Product to be availed by: Individuals & Joint Account Holders (Local and

Foreign), Companies, Corporate, Trusts, etc


a Personalized Cheque books

b Withdrawal Facility from ATM

c Online deposit/ withdrawal facility as per bank's policy

d Debit card; Utilities payment via ATM card

e Mobile Banking

f Call center facilities

g Free bank balance certificates (once in 6 months)

h Taking stop payment/ hold mail/ standing instructions

i Issuance of duplicate statement of account (as per Schedule of Charges)

jPersonal financial consultancy services (regarding Shariah Compliant

products)

k Choice of statement frequency (as per Schedule of Charges)

5 Banking Network: IBD's Branch only

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Al Makhraj Term Deposit

A minimum of only Rs. 25,000 is needed to invest money in Al-Makhraj Term

Deposit. Choice of tenors can be made from a list of options namely 1, 3 & 6 months,

1, 2, 3 or 5 years. Profit payment options available to customers are monthly,

quarterly and/ or at maturity. However, monthly profit payment and deposit product of

1 month are not available currently.

Details of the product are as follows:


2 Islamic Tools used in designing the product: Mudaraba/ Musharaka

3 Tenors Available: 1 mth, 3 mth, 6 mth, 1 yr, 2 yrs, 3 yrs & 5 yrs (1-month product to

be made available later in a few months’ time)

4 Product to be availed by: Individuals & Joint Account Holders (Local and Foreign),

Companies, Corporate, Trusts, etc

5 Special Advantages:

a For Customers = Profit Payment Options customized to suit needs of

customers; Minimum Deposit requirement’s lower than most banks so it is

more accessible/ affordable for people

b Shariah = Meets requirements for Shariah Compliance


a Call center facilities

b Taking hold mail/ standing instructions for profit payments etc

cPersonal financial consultancy services (regarding Shariah Compliant

products)

7 Frequency of Announcements: The first announcement shall be made at the end

of the month of December 2003.

8 Profit Payment Options: Monthly/ Quarterly/ At Maturity (Monthly payment option to

be made available later in a few months time)

9 Weightages: Different weightages based on tenors and profit payment options

10Communication Process: Announcement every month on notice boards, and

website

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ONLINE BANKING

Muslim Commercial Bank provides the Online Banking Facility to its account holders

all over Pakistan. Cash may be accepted at a branch for crediting accounts at

another branch; a branch can also pay the Cheques by debiting the customer’s

account at another branch.

Following facilities are available at Muslim Commercial Bank’s Online Program for its

customers:

1. Payments of Cheques.

2. Cash Receipts.

Transfer of Funds through Cheques or Cash between Branches

MCB VIRTUAL BANKINGMCB Virtual Internet Banking offers you the convenience to manage and control your

banking and finances – when you want to, where you want to. MCB’s Virtual Internet

Banking facility is

-Simple

-Secure

- Free of cost.

With MCB Virtual Internet Banking you

can access any of the banking services, 24 hours a day, 7 days a week and

throughout the year.

What do we Offer

MCB Virtual Internet Banking offers a wide range of online services which

makes your banking accessible anytime and from anywhere.

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Detailed Account Summary of all listed accounts.

Mini-statements of each of the listed accounts showing recent transaction history for that account(s). Statement-by-Period of each of the listed accounts, based on the period

specified.

Immediate or Scheduled Transfer of Funds between your own accounts, as well

as to third-party accounts setup as beneficiaries, maintaining accounts with

MCB.

Scheduling of ‘One-Time’ as well as ‘Recurring’ Funds Transfers.

Payment of utility bills for registered Utility Companies.

Immediate or Scheduled Bills Payment. Scheduling of ‘One-Time’ as well as

‘Recurring’ bill payments. Option for ‘Full’ or ‘Partial’ payment based on the

payment conditions specified by a particular Utility Company.

Bulk Salary Transfer for Corporate Customers, to facilitate them in paying salary

to the corporate employees, who maintain accounts with MCB.

Cheque Book Request for any of your listed accounts.

Payment/Transfer Alerts for reminding, in advance, prior to the processing of

specified payments and transfers.

Personal Alerts for reminding of pre-specified events and occasions

How can you start?

1. Click on the register link on the MCBVirtual Banking page & complete

the application form, suggest your MCBVirtual Internet Banking User ID

choices and click submit.

2. Visit any MCB ATM, select the option “Service Requests” and on the

next screen select Internet Banking Reg. Wait a while for the

Registration to complete and the appropriate message will be

displayed.

3. Check your registered email address for the registration confirmation

containing your Virtual Internet Banking Password and Customer

number.

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With your Customer Number handy, call the MCB Call Centre on (021)

111-000-622 to obtain your User ID. After verification User ID will be

disclosed to you, enabling you to start using the MCB Virtual Internet

Banking service.

Customers living abroad

For users living abroad, MCB Virtual Banking Registration is a three step

process.

1. Fill out the registration form at our website.

2. Send in the duly signed AUTHORITY LETTER at the address given

below:

MCB Virtual Banking Department

9th Floor, Sheikh Sultan Trust Building,

Beamount Road, Karachi-75530,

Pakistan.

After we receive your authority letter we will process your application

and send you an email containing your password and customer

number.

After receiving your password call the MCB Call Centre at 111 000

(MCB) 622 to get your user-id.

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MARKETING STRATEGIESTo be successful, the company must do a better job than its competitors of satisfying

target consumers. Thus, marketing strategies must be geared to the needs of

consumers and also to the strategies of competitors.

In case of MCB, there is a separate department known as Marketing Department at

Head Office, which is responsible for the designing of competitive marketing

strategies. This department formulates marketing strategies by a thorough analysis

of competitors. It constantly compares the value and customer satisfaction delivered

by its products, prices, channels, and promotion with those of its close competitors.

In this way it discerns areas of potential advantage and disadvantage.

After the formulation of marketing strategies, the details of marketing mix are

planned and then transmitted to all branches.

MARKETING MIX

Marketing Mix is a set of controllable tactical marketing tools that the firm blends to

produce the response it wants in the target market. These marketing tools are also

known as Four P’s. These are as under:

Product

It means the good-and-services combination the company offers to the target

market. MCB offers a wide range of financial products and advice for Personal and

Corporate Customers. One can also apply on-line for many of MCB’s Online

Services. Customers can access their accounts using simple and convenient MCB

Virtual Internet Banking services. Below is the catalogue of Products and Services

offered by MCB.

In previous chapter we discussed very briefly products.

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Price

It is the amount of money; customers have to pay to obtain the product.

MCB charges its price in the form of interest rates, mark ups, commission and

various other charges. While deciding about charging rates, it takes care that the

rates should be in compliance with the regulations of SBP as well as suitable enough

to gain the competitive edge.

Place:

It includes those activities of an organization that makes the product available to

target consumers. MCB has taken various steps, to make the availability of its

products and services easy for its customers. At present it has a network of over 900

branches all over the country, over 750 of which are Automated Branches, over 214

ATMs in 35 cities nationwide and a network of over 12 banks on the MNET ATM

Switch. It has also introduced Virtual Banking to provide convenience of banking on

Internet.

Promotion:

It means those activities that communicate the merits of the product and persuade

target customers to buy it. The bank for the promotion of its products and services

spends a heavy sum of money. It offers different schemes from time to time to make

its products and services more attractive for the consumers.

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SWOT ANALYSIS

STRENGTHS

We make every effort to exceed customers’ expectations through superior and wide

array of financial services on the challenge of understanding their need and

aspirations, both realized and unrealized, so that we can satisfy them with surety and

security. MCB is the first Pakistani privatized bank and because of its quality

management, marketing, innovation in products and services. Owing to all such

factors they have established a good reputation in the banking market. The name of

MCB makes you recall the highly cooperative and professional individuals ready to

serve you with maximum zeal and zest.

MCB have faster banking services that are making it more prominent in the banking

industry especially in operations and Foreign exchange. The customer prefers this

bank not only because of its faster speedy service rather due to reasonable service

charges.

MCB in Pakistan is the also in the list of highly automated banks like Emirates

because of its modern style of banking through fully computerized control and twenty

four hour banking. The joining of experienced people, advanced management,

advance setup and facilities gave MCB an edge over its competitors.

WEAKNESSES

The majority of people are not well aware of the products of MCB. Therefore it

should advertise extensively. There are no proper HR policies, In MCB there is lack

of specialized skill because of job rotation policy of human resource department also.

The bank should concentrate upon increasing its abilities on individual service basis.

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OPPORTUNITIES

As economy is growing, there is more investment demand in Pakistan. Banks have

opportunity to enhance their business.

The number of salaried persons is increasing with the economy structure of the

country. This creates opportunity in consumer financing.

THREATS

The Competition has become severe by the entrants of so many banks, So to exist

one will have to prove himself in its services through excellent management and will

have to satisfy its shareholders. Otherwise he will be out the market.

The decrease purchasing power of consumer in the current economic situation of the

country affecting the business activity speed too much and the result is the low

investment from the investors in new projects can create problem for the bank

because it is working a lot in trade.

The State Bank of Pakistan often imposes various restrictions on banks. Therefore,

none of banks is independent in policy making and can launch any product without

the permission of the State Bank of Pakistan.

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FINANCIAL ANALYSISINCREASING TREND OF PROFIT AND EQUITY

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BALANCE SHEET

MCB Bank Limited

Consolidated Condensed Interim Balance Sheet

As at March 31, 2008 Unaudited Audited

Note March 31, December 31,

2008 2007

---------- (RUPEES

IN '000) ----------

Assets

Cash and balances with treasury banks 37,885,070 39,683,883

Balances with other banks 1,620,737 3,867,591

Lending to financial institutions 5,586,228 1,051,372

Investments-net 88,144,002 115,358,590

Advances-net 229,835,445 218,959,786

Operating fixed assets 16,269,138 16,082,781

Deferred tax assets-net - -

Other Assets-net 19,823,235 17,896,838

Total Assets 399,163,855 412,900,841

Liabilities

Bills payable 9,506,255 10,479,258

Borrowings 15,435,553 39,406,831

Deposits and other accounts 301,639,525 292,088,347

Sub-ordinate Loans - 479,232

Liabilities against assets subject to finance lease - -

Deferred tax liabilities – net 11,002,254 1,183,586

Other liabilities 13,107,330 11,716,465

Total Liabilities 340,790,917 355,353,519

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Net Assets 58,372,938 57,547,322

Represented By:

Share capital 6,282,768 6,282,768

Reserves 34,428,786 34,000,927

Un-appropriated profit 7,527,623 7,054,472

48,239,177 47,338,167

Monority interest 62 63

48,239,239 47,338,230

Surplus on revaluation of assets - net of tax 10,133,699 10,209,092

58,372,938 57,547,322

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PROFIT AND LOSS ACCOUNT

MCB Bank Limited

Consolidated Condensed Interim Profit and Loss Account (Un-audited)

For the three months period ended March 31, 2008

---------- (Rupees in '000) ----------

Quarter ended

March 31,

2008

Quarter ended

March 31,

2007

Mark-up / return / interest earned 8,189,576 7,617,338

Mark-up / return / interest expensed 1,992,374 1,564,738

Net Mark-up / interest income 6,197,202 6,052,600

Provision / (reversal) against loans and advances 615,220 192,900

Bad debts written off directly - 54

615,220 192,954

Net Mark-up / interest income after provisions 5,581,982 5,859,646

Non Mark-up / interest income

Fee, Commission and brokerage income 753,251 578,588

Income earned as trustee to various funds 5,177 288

Dividend income 86,923 111,745

Income from dealing in foreign currencies 146,917 221,345

Gain on sale of securities – net 610,456 236,031

Gain / (loss) on trading in government securities 15,268 (33)

Other income 292,304 113,170

Total non mark-up / interest income 1,910,296 1,261,074

7,492,278 7,120,720

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Non mark-up / interest expenses

Administrative expenses 1,696,905 1,884,005

Other provisions / (reversal) - -

Other Charges 75,053 60,043

Total non mark-up / interest expenses 1,771,958 1,744,048

Share of profit of associated undertaking 26,597 1,576,600

5,746,917 5,334,332

Extra ordinary / unusual item - -

Profit before taxation 5,746,917 5,334,332

Taxation - current 2,088,956 1,605,523

- prior years (230,000) (459,952)

- deferred (121,646) 356,543

Share of tax of accociated undertaking 3,032 15,929

1,740,342 1,418,043

Profit after taxation 4,006,575 3,816,289

Share of profit attributable to minority interest (3) (1)

Profit attributable to ordinary shareholders 4,006,572 3,816,288

Earning per share – basic and diluted – Rupees 6.38 6.07

CASH FLOW STATEMENT

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MCB Bank Limited

Consolidated Condensed Interim Cash Flow Statement (Un-audited)

For the three months period ended March 31, 2008

March 31, March 31,

2008 2007

------- (Rupees in '000) --------

Cash flows from operating activities

Profit before taxation 5,746,917 5,334,332

Less: Dividend income (113,520) (269,405)

5,633,397 5,064,927

Adjustments for non-cash charges

Depreciation 188,236 149,157

Amortisation 48,299 46,500

Provision against loans and advances 615,220 192,900

Bad debts written off directly - 54

Un realized (gain) /

loss on revaluation of 'held-for-trading' securities (15,690) (48)

836,065 388,563

6,469,462 5,453,490

(Increase) / decrease in operating assets

Lendings to financial institutions (4,534,856) 4,051,606

Held for trading securities 114,024 (11,765)

Advances - net ( 11,490,879) 11,227,012

Other assets - net (1,858,145) (2,978,659)

( 17,769,856) 12,288,194

Increase / (decrease) in operating liabilities

Bills payable (972,803) 25,538

Borrowings from financial institutions ( 23,971,278) (6,227,039)

Deposits 9,551,178 23,346,495

Other liabilities (824,137) (219,230)

( 16,217,040) 16,925,764

( 27,517,434) 34,667,448

Payments of provision against off-balance sheet obligations - -

Income tax paid (1,118,662) (1,670,873)

Net cash flows from operating activities ( 28,636,096) 32,996,575

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Cash flows from investing activities

Net investments in available-for-sale securities 27,010,046 (36,682,113)

Net investments in held-to-maturity securities 69,714 2,542,903

Dividend income received 63,341 51,836

Investment in operating fixed assets - net of disposals (422,892) (572,416)

Net cash flows from investing activities 26,720,209 (34,659,790)

Cash flows from financing activities

Payment of sub-ordinated loan (479,232) (638,976)

Dividend paid (1,667,194) (539,313)

Net cash flows from financing activities (2,146,426) (1,178,289)

Exchange difference on translation of

net investment in foreign branches 16,646 (7,103)

Increase in cash and cash equivalents (4,045,667) (2,848,607)

Cash and cash equivalents at January 1 43,551,474 3 9,115,635

Cash and cash equivalents at March 31 39,505,807 3 6,267,028

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RATIO ANALYSISMCB Bank Ltd.

Year Ended December 31 Nine-Month Period

Ended September 30

2003 2004 2005 2006

(percentages) (unaudited)

Profitability Ratios

Return on average total assets (4) 0.87 0.96 3.19 3.85

Return on average net worth (4) 29.95 28.38 64.82 52.01

Dividend payout ratio(5) 27.50 25.00 40.22 57.47

Net interest margin (4)(6) 4.66 3.78 6.52 8.30

Gross loan to deposit ratio (4)(7) 49.04 65.14 82.04 76.25

Cost income ratio(8) 67.33 65.95 33.61 30.73

Capital Adequacy (9)

Total capital adequacy ratio 11.61 9.67 12.79 15.92

Tier-I capital adequacy ratio 8.45 6.59 9.53 12.93

Tier-II capital adequacy ratio 3.16 3.07 3.26 2.99

Asset Quality

Gross non-performing loans 10.58 6.14 4.46 4.25

as a percentage of gross Loans

Coverage ratio(10) 61.92 75.73 93.10 96.72

Notes:

(1) Interest earned includes dividends and capital gains earned on equity and preference shares and

units

of mutual funds.

(2) Per equity share data for the years ended December 31, 2003 and 2004 is based on the number

of

equity shares outstanding as of December 31, 2005. Per equity share data for the six-month period

ended June 30, 2005 is based on the number of equity shares outstanding as of June 30, 2006.

(4) June data has been presented on an annualized basis.

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INTERNSHIP ACTIVITIES

OBECTIVE OF INTERNSHIP

This internship was the part of my study course, so objective of this internship was to

learn and gain some practical experience. During my MBA program, I studied many

courses about finance, management etc. Here my aim was to see the application of

this bookish knowledge and its practical implementation. How it is useful in practical

life. I saw the differences in bookish knowledge and its application.

In all jobs related to finance, there is involvement of banks. So my aim was to learn

how banks deal with corporate and general information about rules and regulation of

banks. My second objective of this internship was to learn about general banking, as

customer.

I tried to get experience, how to work with people of different age, different

educational background, and different interests. How I can be a best team player,

how to interact with officer and deal with subordinates.

ACTIVITIES DURING INTERNSHIP

Date Description Supervisor

03 July to

05 July

I worked in Clearing department. Here

major activities were to receive the

cheques and send these for clearing to

other bank after stamping and keeping in

record.

Mr. Asif Butt

07 July to

12 July

I worked in remittance department. Here

we issued, DD, Pay order, TT, and like

other responsibilities.

Mr. M Imran

14 July to Account opening is the entrance to bank. Mr. M Imran

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19 July In this department I worked on different

old account and open new account for

individual.

21 July to

26 July

I learn some about advances and learn

about locker services new.

Mr. Asif Butt

28 July to

02 Aug

I worked in cash department up to some

extend I pay Zakat and pensions to the

people.

Mr. M Sadiq

04 Aug to

09 Aug

Again I worked in remittance department.

Here we issued, DD, Pay order, TT, MT

and like other responsibilities.

Mr. M Imran

NEW KNOWLEDGE ACQUIRED

As this was my first experience in any bank, so all working of bank was new for me.

Some of the new work we write down in earlier pages briefly now I just writing

summary of these work.

HOW OPEN AN ACCOUNT

Firstly we require NIC copy and photo graph then we fill account opening form then

we verify NIC from NADRA after these requirements, bank will open the account and

sends letter of thanks to its customer. When account holder comes with letter of

thanks bank will issue chequebook to account holder. If chequebook is lost the

account holder has to give written application for the stop payment of cheques of that

chequebook and fill a form for issuance of new chequebook.

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CLEARING DEPARTMENT

Clearing is used to pay or receive payments to other banks. There are two types of

clearing.

Inward clearing

Outward clearing

INWARD CLEARING

Cheques of our branch that are deposited at other banks are brought to us. This is

called inward clearing. In inward clearing we DEBIT a/c of our a/c holder and

CREDIT other branch.

OUTWARD CLEARING

In outward clearing cheques of other banks are presented in our branch. In it we

check certain factors such as words and figure difference, date of cheque etc. 3

stamps of MCB stamped in these cheques

Clearing stamp

Crossing stamp

Payees a/c credited stamp

In outward clearing we DEBIT suspense a/c and CREDIT a/c no. of our a/c holders

CHEQUE RETURN IN OUTWARD CLEARING

If cheque is returned in outward clearing we make an entry of the returned cheque in

the register and give it back to our customer after having his signatures in the

register.

CHEQUE RETURN IN INWARD CLEARING

If the cheque is returned in inward clearing, we fine our a/c holder as a penalty and

also make an entry in the register.

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INTER BRANCH CREDIT TRANSACTION (IBC)

IBC advice is made for both inward and outward clearing. With IBC we online

transfer money.

CASH DEPARTMENT

Cash is the key component of banking operations handled by the front desks. The

cash dealing staff and infrastructure provided as such must be presentable and

major emphasis must include quality service to the customers.

Cash must be placed in fire proof safes/strong room overnight strictly in accordance

with the limits allowed by Head Office and well within the Insurance limits. The cash

is withdrawn from safes in the morning keeping in view the business of the branch

and expected transactions. Insurance limit of Cash on Counter must be adhered to

meticulously.

CASH RECEIPTS / PAYMENTS

Cash Received on counter will be entered in Receiving Cashier Book and metal

stamp “RECEIVED CASH” shall be affixed on both the portions of Pay-in-slip along-

with signatures of receiving officer. Customer’s portion will be handed over to him

after joint signature of the supervising officer.

The paying cash officer will make payment of cheques and other instruments which

are passed by authorized signatory after entering into record keeping register. Metal

stamp “PAID CASH” shall be affixed on the cheques/instrument.

CASH ON HAND

After the close of business hours, the Cash Officer shall sum up the day’s

transactions. After agreeing the total of Receipts/Payments, the cash on hand shall

be tallied with Cash Balance Book both shall be jointly signed by the Operation

Manager/Manager and cash officer.

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RECOMMENDATIONS

Last year’s performance shows that the Muslim Commercial Bank is increasing

its profitability and its deposits. MCB should also capture the government

account.

Bank must let potential customers know that all attractions for banking exist. This

is done by advertising on television and obtaining press coverage, in conjunction

with direct mail, window displays, leaflet in branches and in appropriate other

locations (such as hotels, shops, etc.) and including leaflets in statement of

accounts sent to existing customers in the hope that they will tell potential

customers about the services provided by our bank.

Financially unsophisticated people might feel bank accounts, cheque books,

credit cards, etc. are difficult to understand and to keep control thereof.

To manage its all branches MCB should establish the intranet system in all

branches.

MCB should increase the line of product to attract the new clients.

Those activities, which a person can perform, should be integrated to save time.

Some personal sector customers do not prefer to come to branch. They

increasingly want to deal with the bank in other ways, such as home banking or

use of Automated Teller Machines (ATMs), which need to be at the branch or

some important shopping plazas.

Arguably, there has been a little encouragement from banks to persuade people

to open a bank account. Opening hours are restricted, and there is a commonly

held belief that banks operate for their convenience and not for the convenience

of the customers.

A short term promotional technique is to offer price incentives, for example, low

interest rates on advances or limited issue high profit bearing term deposits.

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CONCLUSION

MCB is the one of the best bank in local banking sector. Its growth rate is highest.

There are some flaws but MCB has potential to become top ranking bank in

Pakistan banking industry.

My basic purpose of this internship is to learn about the working of bank. During my

internship I got knowledge about general banking and advances. Staff member of

MCB are cooperative with me and really help me to achieve my objective.

BIBLIOGRAPHY

http://www.mcb.com.pk

http://www.sbp.org.pk

http://www.paksearch.com

Staff of Muslim Commercial Bank

Annual reports of Muslim Commercial Bank

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84

mcb

Documents

scheduled commercial

internship report attitude

internship period

exercise of internship

week internship

lending policy of bank

management of mcb

business practices