Documenti di Didattica
Documenti di Professioni
Documenti di Cultura
INTERNSHIP REPORT
ON
Department:
MBA (Evening)
Sec: ( I )
Submit Date :
JUNE 27,2014
Executive Summary
I am pleased to present my final project to the most respected members of the
UNIVERSITY OF GUJRAT, Gujrat. In this project I have tried to explain all the
aspects of MCB Bank of Pakistan starting with an introduction to its environment and
scope of its activities.
In this report I am discussing the operations of MCB Bank of Pakistan Bank Wadala
Sundhwan branch, SIALKOT. I have explained a brief history of the bank following with the
banks operational structure and services of MCB.
I have also tried to turn the attention of the readers towards the functions, policies, practices
and styles of field of activities of the bank. I have explained these activities, which include
deposit, cash dealing, credit and remittance that I have observed during my tenure in that
bank. In addition to that I have also explained its financial analysis, which proves that
financially it is very strong.
In the last part of the report. I have tried to put some useful recommendations for the
betterment of the banks activities according to my study.
ACKNOWLEDGEMENT
Every praise is due to Allah alone the merciful and his Apostle (peace be upon him) who is
forever a torch of guidance and knowledge for humanity as whole. This report is also the
result of help & guidance, which I received from my teachers and my institution (APTECH
Sialkot), who gave me lot of information and guidance in making this report.
I met different staff members of the Muslim Commercial Bank of Pakistan. For getting
information to complete my internship report. Therefore, it is difficult for me to mention all
the names of these people, but there are some special persons from the management of
Muslim Commercial Bank of Pakistan from whom I learned very much.
Sr.#
1
2
3
TABLE OF CONTENTS
05
06-07
06
07-08
09-11
4. Product Lines
02
EXECUTIVE SUMMARY
OBJECTIVES OF STUDYING
OVERVIEW OF THE ORGANIZATION
3. NO. of Employees
Page #
12
13-18
19
19-20
21-22
23-24
Cash Department
24
Deposit Department
25-31
Clearing Department
32-34
Advance Department
35-38
Remittance Department
39
Technology Department
41-43
43-45
46
DEPARTMENT
5. Structure of Finance Department
46
47
47-49
49
2. OBJECTIVES OF STUDYING:
Ensure that its performance in all facts of its operations more than matches that of its
competitors.
To provide services to their customers and assistance in the development of commerce
and trade.
Maintains a comprehensive range of domestic and international activities.
Maximize contributions from its key sources of personal machines brands representation
and capital.
Be innovative progressive and the need of its customers with in the frame work of
operational and prudent risk taker.
Act as a reputable efficient and responsible organization.
MCB bank also has another responsibility to give service to their communities. It watches
the growth and development of his community especially the commerce and business of
the area.
To get awareness about the business development & financial techniques.
Study the facilities provided by the organization to common public in various forms.
To study the terms & conditions for fringe benefits provided to employees of the
organization at the age of superannuation.
Pursue personal policies which recognize the aspirations and performance of individual
and which are suited to the devise levels of skills.
3.1 HISTORY:
MCB Bank Limited, with more than 60 years of experience as one of the leading banks in
Pakistan, was incorporated on July 9 in 1947. The bank has journeyed remarkable tenure of
more than half a century of competitively edged and well positioned heights of success by
deploying quality banking, heads on technological developments, professionally leading
management and prudent and ethical work methodologies. MCB was nationalized along with
other private banks in 1974 as part of Government of Pakistan's economic reform movement
and was later privatized to Nishat Group lead consortium in 1991.
Since privatization, MCB's growth has been phenomenal. Today, MCB in one of the largest
foreign banks in Sri Lanka, the first bank in Pakistan to launch Global Depository Receipts
(GDR) in 2006, has strategic foreign partnership with Maybank of Malaysia which holds
20% shares in MCB through its wholly owned subsidiary Mayban International Trust
(Labuan) Berhad since 2008, has international indirect regional presence in Dubai (UAE),
Bahrain, Azerbaijan, Hong Kong and Sri Lanka and serving through a domestic network of
over 1,130 branches and 600 ATMs across Pakistan with a customer base of 4.5 million
(apprx.)
MCB is reputed as one of the most sound financial institution and as one of the leading banks
in Pakistan with a deposit base of PKR. 462 bln (apprx.) and total assets of PKR 605 bln
(apprx.). The bank is versed as one of the oldest and most responsible banks in Pakistan and
has played pivotal role in representing the country on global platforms while being one of the
few institutions that are recognised and traded in the international market.
Vision:
To be the leading financial services provider, partnering with our customers
for a more prosperous and secure future.
Mission:
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
confidence in us.
DEVELOPMENTS:
After privatization, the growth in every department of the bank has been observed. Following
are some key developments:
1. Launching of different deposit schemes to increase saving level.
2. Increased participation on foreign trade.
3. Betterment of branches and staff service level.
4. Introduction of Rupee Traveler Cheques & Photo Credit Card for the first
Time in
Pakistan.
5. Extended use of information technology which is evident from the fact that
networking), 151 ATMS in 27 cities nation wide and a M.C.B continuously innovate
new product.
Lahore, respectively. The Bank operates 1,074 branches including 11 Islamic banking
branches (2008: 1,040 branches including 11 Islamic banking branches) within Pakistan and
7 branches (2008: 7 branches) outside the country (including the Karachi Export Processing
Zone branch).
The purpose of banks is to provide some services to the public. Moreover, for this purpose
different banks provide different services to the people in different forms. The Muslim
Commercial Bank (MCB) is a commercial bank, in modern time commercial banks play a
very important role and their functions are manifold. The main functions and services that
MCB Bank Limited provides to different peoples are as follows.
a. Open Different accounts for different peoples.
b. Accepting various types of deposits.
c. Granting loans & advances.
Undertaking of agency services and general utility functions, few of those are listed
below:
a. Collecting cheques and bill of exchange for the customers.
b. Collecting interest due, dividend, pensions and other sum due to customers.
c. Transfer of money from place to place.
d. Acting an executor, trustee or attorney for the customers.
e Providing safe custody and facilities to keep jewellery, documents or Securities.
f. Issuing of travelers cheques and letters of credit to give credit facilities to Travel.
g. Accepting bills of exchange on behalf of customers.
h. Purchasing shares for the customers.
i. Undertaking foreign exchange business.
j. Furnishing trade information and tendering advice to customers.
Table No.1
(In Millions)
PARTICULAR
2006
Deposits
2008
2009
2010
362865637 395492331
465571717
463426602
367604711
Advances(Net)
140547374
161265760
220794075
268838779
253249407
Total Revenue
-738616
-1477232
6044811
9008708
11977601
19056028
23,154,945
3730384
4103422
4924106
5908927
6,911,045
2253385
4198103
6195372
12709444
15495297
Investments
143524971 166195619
149350096
156985686
167134465
4.78
6.31
6.43
10.2
Shareholder
Equity
EPS(Rs Per
Share)
2007
6.80
Source: http://www.MCB.com.pk/FinancialStatement
10
SHAREHOLDERS EQUITY:
Shareholder equity shows the nine year data now we discuss the last five year progress of the
bank. In current year shareholders equity is Rs. 6,911,045 that is very high than past four
years compression. In 2009 shareholder Equity show the highest progress but 2005 show very
low progress than other four years.
INVESTMENTS:
The chart shows the nine year data now we discuss about last five year Investments progress
of the MCB. In 2009 the MCB invested more money as compare other years. The investment
is the main source of earn profit and make the organization strong. The bank invests money in
these sectors which help to make our economic strong. In current year MCB investments is
Rs. 167134465 that is high than the past year.
11
Number of Posts
Chairman
President
Board of Directors
10
Deputy CEO
30
2300 (Approx)
Technical Staff
615 (Approx)
Security Staff
575
800
Total Employees
4334 (Approx)
12
14
FAX PRESS:
This product was first of its kind introduced by using modem technology of The Fax
Machine. It facilitates speedy transfer of funds within Pakistan. The service guarantees
transfer of from one city to another, within an hour.
NIGHT BANKING SERVICE:
For the convenience of the account holder, service has, especially, been introduced at busy
commercial centers. Traders and other clients can now make deposit, with case, at such
centers up to 8.00PM.
UTILITY BILLS COLLECTION:
With the aim of extending this service to wider range of customers, the number of MCB
branches collecting Utility Bills more than 900.
MCB MOBILE:
MCB mobile banking dial in any time to get information regarding balance and mini
statements.
PYARA GHAR:
Flexible and competitive home financing facility with options of home purchase, construction
and renovation.
ISLAMIC BANKING SERVICES:
Islamic banking services through exclusive units/branches offering a range of liability and
asset based Sharia compliant products like Musharika, Murabaha, Ijara and Istasana.
15
LOCKERS:
The best protection for valuable items. Lockers of different capacities are available
nationwide.
ON-LINE:
The largest network of over 315 on-line branches in the country and growing. Providing
customers with 24 * 7 real time on-line transaction facilities.
MCB FULL DAY BANKING:
Enjoy the convenience of extended banking hours from 9 to 5, even on Saturdays, for
satisfying banking needs at all MCB Full Day Banking branches across the country where
every one is now served with a wide range of services through the day.
PLS 365:
A deposit account for customers with substantial balances, offering profit on a daily product
basis with the facility of unlimited withdrawals.
MCB SPECIAL RUPEE TERM DEPOSITS:
MCBs Special Rupee Term Deposits offer a very attractive term investment option with ease
and convenience. Tenors options available are of 3 months, 6 months, 1 year, 3 years and 5
years. Here also available a credit facility up to 75% of total deposits.
MCB REMIT EXPRESS:
International remittances with a two-way messaging facility delivered at customers doorstop
within 24 to 72 hours.
MCB CARDS:
A local Point of Sale acquiring network facilitating acceptance of all major card brands.
16
CIRRUS:
MCB Smart Card and ATM card holders can avail cash withdrawal facility at over 900,000
ATMS worldwide.
MAESTRO:
MCB Smart Card and ATM card holders enjoy the convenience of shopping at over 5 million
POS locations globally.
MCB VIRTUAL INTERNET BANKING:
MCB provides the convenience of banking on the internet. Whether at office, home or
traveling log on to www.mcb.com.pk and enjoy 24-hour access to all accounts at MCB for
the largest array of services.
MCB CALL CENTRE:
Call now for answers to queries about banking services. ATM services, mobile banking
services, RTC services, tele-banking services and MCB product information.
MCB ATM 24-HOURS CASH:
The nations largest network of over 210 ATMs and growing. Get 24-hour convenience of
cash withdrawal, mini-statement, bill payment and funds transfer services.
MNET:
MNET is an electronic hub for ATM sharing plus other touch points. Members include 12
local financial institutions enjoying ATM sharing and bureau services. Pakistans largest
operating switch with the highest transactions volume.
MCB SMART CARDS:
MCB Smart Card - a secure instrument of payment, offering Cash Free convenience. It
provides 24-hour direct access to bank account and unmatched functionalities.
17
18
4. ORGANIZATIONAL STRUCTURE:
4.1 OVERALL ORGANIZATIONAL STRUCTURE:
As MCB Bank Limited is a banking company listed in stock exchange therefore it follows all
the legalities which are imposed by concerned statutes Mr. Muhammad Mansha is chairman
& chief executive of the company with a team of 10 directors and 1 vice chairman to help in
the business control and strategy making for the company.
Operational Management of the bank is being handled by a team of 10 professionals. This
team is also headed by Mr. Muhammad Mansha. The different operational departments are
Consumer Banking & IT div; Financial & Inter branch div; Banking operations div; HR &
Legal div; financial control & Audit div; Credit management div; Commercial Banking div;
Corporate Banking div; Treasury management & FX Group and lastly Special Assets
Management (SAM) Group.
For effective handling of branches, it has been categorized into three segments with different
people handling each category. These categories are mentioned below.
i. Finance Division
ii. Special Assets Management Division
iii. Treasury Division
iv. International Division
v. Operations Division
vi. Information Technology Division
vii. Human Resource Division
viii. Audit & Inspection Division
Ix. Credit Administration Division
19
At
regional
level,
of
controlling
the
region.
For
in
for
assisting
in
20
I did my internship in MCB Bank Limited Bank square Branch Sialkot. And some
important information about my branch which I observed is as follows:
CASH DEPARTMENT:
The following books are maintained in the Cash Department:
1. Receiving Cash Book
2. Paying Cash Book
3. Token Book
4. Scroll Book
5. Cash Balance Book
When cash is received in counter, it is entered in the Scroll Book and Receiving Cashier
Book.
At
the
close
of
the
day,
these
are
balanced
with
each
other.
When the cheques or any negotiable instrument is presented at counter for payment, it is
entered in the token book and token is issued to the customer. The token clerk and the
Cashier make entries in the paying book and payment is made to payee. At the close of
day,
the
Token
Book
and
Paying
Cashier
Book
are
balanced.
The consolidated figure of receipt and payment of cash is entered in the cash balance
book
and
drawn
closing
balance
of
cash.
is allowed to enter or leave the area freely. Mostly, cash area is grilled and its door is
under supervision of the head of that department. All the books maintained in this
department are checked by an officer.
DEPOSIT DEPARTMENT:
Bank deals in money and they are merely mobilizing funds within the economy. They
borrow from one person and lend to another, the difference between the rate of borrowing
lending forms their spread or gross profit. Therefore we can rightly state that deposits are
the blood of the bank which causes the body of an institution to get to work. These
deposits are liability of the bank so from point of view of bank we can refer to them as
liabilities.
The total deposits of MCB are growing since its inauguration but after privatization there
is a sharp incline in over all deposits of the bank. The increase in deposits is also a cause
of increase on total number of accounts; bank has progressed in both aspects.
CLEARING DEPARTMENT:
Every banker acts both as a paying as well as a collecting banker, It is however an
important function of crossed cheques. A large part of this work is carried out through the
bankers clearing house.
A clearing house is a place where representative of all banks of the city get together and
settle the receipts and payment of cheques drawn on each other. As the collecting banker
runs certain risks in receipt of their ownership the law has provided certain protections to
the banks.
The Negotiable Instrument Act, 1881, lays down hat drawer or holder of a cheque or draft
may cross the instrument generally or specially. It further lies down that a crossed cheque
can only be paid to a banker, who collects it for a customer in good faith and without
negligence.
Note:
Branch Hierarchy is attached at the end.
the paying book and payment is made to payee. At the close of day, the Token Book and
Paying Cashier Book are balanced. The consolidated figure of receipt and payment of
cash is entered in the cash balance book and drawn closing balance of cash.
Opening Balance + Receipts - Payments = closing Balance.
This is very important department because cash is the most liquid asset and mostly frauds
are made in this department, therefore, extra care is taken in this department and nobody
is allowed to enter or leave the area freely. Mostly, cash area is grilled and its door is
under supervision of the head of that department. All the books maintained in this
department are checked by an officer.
aspects.
TYPES OF DEPOSITS:
Deposits can be segregated on two bases, one is the duration in which there funds are
expected to be with the bank and second is the cost of getting these funds. So divide
deposits in two classes according to duration of deposits i.e.
deductions,
additional
benefits,
eligibility
for
different
groups.
In the similar fashion, MCB has a large variety of deposit schemes and some of them are
as follows:
CURRENT A/C (CD):
In this type of accounts the client is allowed to deposit or withdraw money as and when
he likes. He may, thus, deposits or withdraws money several times in a day if he likes.
There is also no restriction of amount to be deposited or withdrawn. However, there is
requirement of minimum balance maintenance of Rs. 1000/-. Usually this type of account
is opened by the businessmen. No profit is paid by the bank and no service charges are
deducted by the bank on current deposits account. These types of deposits are also
exempt from compulsory deduction of Zakat.
PLS SAVING BANK A/C (SA):
This type of account is for those persons who want to make small savings'. This type of
account is opened with a minimum deposit of Rs. 1000/-. Under this scheme deposits can
be made only up to a-costing amount and withdrawals are allowed twice a week or 8
times a month. If a big amount is required a seven days notice is required before the
withdrawal. The profit is paid on these accounts on the minimum balance during a month
for the whole of that month. Zakat & other withholding taxes are deducted as per rules of
the government.
on
in
other
words
no
profit
is
paid
for
that
month.
NOTE:
PLS Saving, Khushhali Bachat & PLS 365 saving accounts can be opened in
foreign currency also. Before nuclear tests of 1998 these accounts were opened in four
major currencies but now these are only opened in USD ($). However, now bank
discourages the opening of foreign currency accounts because no forward cover risk is
provided by State Bank of Pakistan (SBP) and all the loss in case of devaluation or
depreciation in local currency has to be born by bank himself. This increase in cost has
left foreign currency account of no use, therefore, now bank prefers to accept deposits in
local currency rather in foreign exchange.
Bank usually requires that new depositor must be introduced by some one. An introducer
can be any person known to the bank but preferably it should be a customer of the bank.
However,
the
manager
can
open
the
account
by
his
own
introduction.
If the manager is satisfied, it will obtain the full signature of the customer- on the form
and specimen signature card, makes the first deposit, and issues the cheques book.
The following are given to the customers:
Pay-in-slip is the proof of deposit. For every payment which is. to be deposited in the
bank, the pay-in-slip is to be filled up. The object of this book is to provide the customer
with the bank's acknowledgment for receipt of money to be credited this account.
Cheques Book contains a number of cheques. It enables a customer to make withdrawal
from this account or make payment of various parties by issue of cheques.
Pass Book is a copy of the customers account as appears in the books of the bank.
Balance is recorded in this book by the Clerk.
NOTE:
1. In case of partnership account partnership deed should be attached.
2. In case of companies memorandum and article of association, certificate of
Incorporation, certificates for commencement of business, list of directors and board
Resolution for opening of account is also obtained from the customer.
3. Accounts of Trusts, Executors & Administrators can also be opened but with the
Prior approval of the Head Office.
Profit payment & calculation is done in accordance with the rules of each type of deposit
scheme-by the deposit department. The products for each deposit scheme are calculated
separately and added till the end of 6 month period. Then the sum total of these products
is multiplied with the respective profit rates which are issued by the Head Office at the
end of each half yearly closing. The profit provisions for each type of deposits are also
calculated on monthly basis by the same department in order to calculate the net profit or
loss position of the branch.
Accounting entries are also made in the respective books of account by this department.
However, in small and medium size branches, the accountant performs the book keeping
duties for all kinds of ledgers.
i. Transfer cheques:
Are those cheques, which are collected and paid by the same branch of bank?
Transfer delivery cheques: are those cheques, which are collected and paid by two
different branches of the same bank situated in the same city
If the instrument is crossed not negotiable it can be for the third party (an endorsee
of an order cheque, or a holder of bearer cheque).
If cheques are "crossed Account Payee's" only or "Payee's Account", it should only
be accepted for collection for the payee's account.
h). The cheques or drafts should not be crossed specially to any other bank.
i). A cheques payable to a firm should not be accepted for credit to a partner's account.
j). A cheques payable to one of the joint account holders should not be collected for the
joint account without the payee's endorsement, or consent.
k). A cheques drawn by a customer in the capacity of agent, Attorney, or Manager of his
company or firm, should not be collected for credit to his personal account.
l).
Pay orders, although negotiable should not be collected for third parties.
m). Do not collect an instrument in the account of an agent or of the servant of the payee
or endorsee of the instrument.
n). Not transferable" instruments, like Telegraphic Transfer, or Mail Transfer Receipt,
Pay-slips, and Treasury Receipts, should be collected for a person other payee.
o). If an account is new or the balance or operation of the account is not satisfactory,
satisfy your self about the title of the customers to the instruments before accepting
the deposits.
p). Branch agent's permission should be obtained before accepting a third party cheque
or draft for the credit of the member.
q). If the payee is a Government Department, Government Official, or a trust account
the instrument cannot be collected, but for the payee's account.
r). If the payee of an instrument is UBL, it can be collected for credit of the drawers
account, or the amount of the instrument may be utilized as desired by the drawer in
writing.
s). Cheques payable to a trust, account should not be collected for credit to a trustee's
account.
t). All the endorsement should be regular, and no endorsement should be missing.
Note: No charges are charged by the bank for this purpose.
On repayment of loan, the gold or ornaments held as security for it, together with the
demand promissory note duly discharged is returned to the borrower and his receipt for
the gold ornament taken in the demand loan ledger. This receipts states that he ornaments
returned are complete and in order. Part delivery of ornaments is given against part
payment of a loan but care is taken that the ornaments still in banks possession fully
covers the balance of the loan outstanding. The interest gold loan is to be applied with
quarterly.
LOAN AGAINST PLEDGED OF STOCK:
In case of advancing such types of loans, the following precautions are dept in the mind:
i) Stock pledged must be readily saleable
ii) Products should be readily saleable
iii) Advance should be within the borrows means
which he can draw when he requires and interest is charged on the amount actually
utilized by the customer. In order to avoid the danger of idle fund, the bank charges a
certain rate of interest, even if the customer does not withdraw any amount. The rate
charged by the bank on cash credit in 46 paisa per thousand on daily basis.
The credit is usually given against the securities of goods or merchandize as follows:
SCRUTINY OF APPLICATION:
The DD application must be scrutinized by the counter clerk in respect of following
points.
There should be branch where payment is to be made.
1. Full name of payer should be mentioned
2. Amount in words and figures must be same
3. Application to be signed by the purchaser
4. Telegraphic Transfer
Transfer of funds from one branch to another branch of the same bank or upon other bank
under special arrangements.
Telegraphic transfer is not negotiable
The funds are not payable to bearer
Minor cannot avail this facility
PARTIES:
Following are the parties involved
Applicant
Drawing branch
Drawee branch
Beneficiary
Full name of the beneficiary or account number should be mentioned in the application
form.
Instruction regarding mode of payment should be obtained.
a record in the remittance outward register should be maintained.
all the remittance must be controlled through number.
MAIL TRANSFER:
Transfer of funds from one branch to another branch of the same bank with in or out
side the city is called mail transfer.
Mail transfer is not negotiable
the procedure is same as for DD
All precautions must be observed
PAY ORDERS:
Pay order is meant for bank own payment but in practice they are also issued to
customers.
A pay order is written authorization for payment made in a receipt form issued and
payable by the bank. To the person named and address.
The following are the parties:
1. purchaser
2. issuing branch
3.
Payee
MCB has also introduced the now concept of online banking. There are now more than
250 branches linked through this system and they can transact with each other directly
using computer systems at their own branches. Now customers do not have to wait long
for their transactions and can operate their account through all the online branches.
ATM NETWORK:
ATM stands for Automatic Teller Machine. This machine is used to transact in one's
account without intervention of humans. These machines are basically used for taking
cash, confirming balances and requesting statements / cheque books.
MCB has the largest ATM network in the country at the moment with almost one ATM at
each online branch and also ATM terminals at International Airports. This network covers
more than the 27 cities of Pakistan including the provincial capitals and large commercial
cities of the country.
ATMs are operated through a card issued to the valued customers and by application of
Personal Identification Number (PIN number). A person can withdraw from any machine
across Pakistan with having an account in only one branch of MCB. This was only
possible with the help of online system. In this system all the machines are linked to
central banking host at IRM division Karachi through either satellite or telephone
controller. This system identifies the card holder and his PIN Number.
Now MCB has also entered into a contract with Cirrus which is a subsidiary of
MasterCard. This contract will enable an ATM card holder to use his account even when
he is out of country at all the ATMs where Cirrus logo is displayed.
Green Cards are ordinary cards with a maximum withdrawal facility of Rs. 10,000/- in a
day. The annual fee for this card is Rs. 300/- only.
Gold Cards are special cars with maximum withdrawal limit of Rs. 25000/- in a day.
These cards are issued to the persons having more than Rs. 500000/- as their average
balance.
International Cards are issued in collaboration with Cirrus and are useable all over the
world with maximum withdrawal facility according to the standards of Cirrus.
Mark Up Rates:
Fixed Rate Option:
Priced at 10 years PIB rates plus 3.5 % with re-pricing after 10 years (subject to a
minimum floor)
1. Budgets include capital, manpower and overhead budgets along with variance
analyses.
2. Quarterly operating results of the company as a whole and in terms of its operating
divisions or business segments.
3. Details of joint ventures or collaboration agreements or agreements with
distributors, agents, etc.
4. Default in payment of principal and/or interest, including penalties on late payments
and other dues, to a creditor, bank or financial institution, or default in payment of
public deposit.
5. Failure to recover material amounts of loans, advances, and deposits
Made by the company, including trade debts and inter-corporate finances.
6. Significant public or product liability claims likely to be made against
7. The company, including any adverse judgment or order made on the
Conduct of the company.
The MCB Bank has special designed soft wares to fulfill the entire accounting
requirements according to banking standards. Following three main soft wares/systems
are used in the MCB Bank for this purpose:
Telnet:
It is an operating system used by the MCB Bank in every branch. This system is used to
record the transactions manually. It is centralized only within the branch. It has no links
with other branches directly. There are number of modules in this software for generating
various customized reports. These reports are used in determining financial position of
the branches and customers queries for different purposes.
Management Information System (MIS):
It is a web based system used by the MCB Bank management for monitoring of braches
and regions. This system is maintained by the IT division of the MCB Bank. In this
system all the transactions are recorded automatically by each branches using said SOP of
the bank. Data of this system is not centralized only within the branch but can also be
accessed by every MCB officer and executive.
MCB On-Line:
The MCB Bank has software known as MCB on-line to interlink branches. It is basically
networking based software. By this software all the branches are linked with each other
directly. Now all the branches have access to other branches for crediting or debiting the
customers accounts. No data other than customers account balance is provided on this
system. Using this software the upper management aimed to more speedy access to
process the information and to make accurate decisions at branch level.
Table No: 2
Amount in Millions
Items
Borrowings
2006
6,791,007
2007
6,989,424
Source: http://www.MCB.com.pk/Financial
2008
17,842,915
Statement
2009
12,278,773
2010
44662088
C om m en ts o n P o o l i n g of t h e B a n k :
Deposits:
There is upward trend in deposits of the bank during 2005 to 2009. This trend is resulted
due to better services standards and interest rates of the bank offered to the customers
during this period. In 2008 figure of this source of funds decreased due to internal crises
of the bank and downward trend of interest rates offered to the customers on deposits.
Borrowings:
There is upward trend in borrowings of the bank from other financial institutions during
2005 to 2009. This trend is resulted due to increasing funds demand of the bank
expansion of the banking business in this period. In 2008 figure of this source of funds
decreased due to internal crises of the bank and avoiding behavior in advancing funds to
the bank by the other financial institutions due poor financial position of the bank.
2006
2007
12428332
5209092
2008
2009
2010
12716738 14387935
23311967
35774544
7248239
9424625
5642885
non-
mark-up
interest income
Source: http://www.MCB.com.pk/Financial
Statement
8257159
C om m en ts o n I n c om e G e n e r a t i o n :
Mark-Up / Return / Interest Income:
There is upward trend in mark-up / return / interest income of the bank during 2005 to
2009. This trend is resulted due to prudent lending policies of the bank in this period. The
bank advanced the funds to best possible extent in this period to regular parties having
good pay back record.
Total Non-Mark-Up / Interest Income:
There is upward trend in non-mark-up / return / interest income of the bank during 2005
to 2008. This trend is resulted due to better services standards of the bank offered to the
customers during this period. In 2009 figure of this income decreased due to internal
crises of the bank and competition in market.
5.7 Al l ocat i on of Fu n d s:
The MCB Bank allocates funds in following two main areas:
1. Investments
2. Advances
Table No. 4
2006
Item
2007
2008
2009
2010
143524971
166195619
149350096
156985686
167134465
140547374
161265760
220794075
268838779
253249407
Net
Investments
Net
Advances
Source: http://www.MCB.com.pk/Financial
Statement
C o m m e n t s o n F u n d s Al l o c a t i o n :
Net Investments:
There is upward trend in net investments of the bank during 2005 to 2006. This trend is
resulted due to better funds generation position of the bank in this period and favorable
investment environment in the country. In 2007 figure of this item decreased due to
internal crises of the bank and financial crisis in the whole world.
Net Advances:
There is upward trend in net advances of the bank during 2005 to 2008. This trend is
resulted due to better funds generation position of the bank that allowed advancing more
to the customers in this period. In 2009 figure of this item decreased because of worst
recovery behavior due to financial crisis in the whole world.
7.WEAKNESSES:
MCB major fault is that wasnt keeping its pace with on going changing in
banking industry unlike other bank. Now this bank combining all it power and
trying to approach other banks.
Latest reorganizing efforts are necessary to make it cost effective also making
its facility accordingly to modern banking. These must continue.
Bank management has to put its all effort to change the prevailing culture of
the bank and to put the foundation stone of business oriented culture. In which
employees give important to the bank and its customer.
To attract the customer in the future MCB have to make extensive effort to give
facilities of retail and consumer banking. Plus the technology in the banking
which will be necessary for future banking is another week area need to be
stressed.
The outlook and interior lay out of the branches is another thing, which needs
to be
improved.
The procedure of taking services from the bank must be made easier and
straightforward not involving long difficult procedure for simple task
To remain in the market bank need to be vigilant in the eyes of customer. One
way is through promotion efforts, so that people aware about he services of the
banking and any addition which the bank as made in the portfolio of its
services.
CONCLUSION:
It is evident from this report and the financial statements of MCB that it is making
progress rapidly. The profits of MCB have grown considerably during the last few
years and this trend is expected to continue into the future.
Therefore, it is conclude that MCB has a very prosperous present and future, which
assures the shareholders of wealth maximization. Side by side of it I think that if
bank would be able to cover and control on the above mentioned recommendations
then it would be in such a situation that will really lead it towards the road of prosperity,
development and integrity. Moreover, with the above-mentioned sentences I think
there is too fault of the customers and in order to make the proper working of the
bank the customers should also cooperate with the bank, which will be really a
good, ambitious and diligent condition for the bank. Then bank will be really in
such a situation and position to compete its competitors in the country as well as on
international
level.
A research cell should continuously try to gather information about the present
action so its competitors and expected future actions. So in this way strategies that
are more effective can be formulated.
The performance reward linkage should be making strong as it is said, "A happy
employee delivers more than he receives from the organization." The MCB
should also try to make its employees happier.
There is immediate need, to reconstruct the personnel policies. Selection should be
through newspaper advertisements. In this way, more intelligent, efficient and
qualified staff can be formulated.
It is strongly recommended that MCB should go for computerization rather than
manual work, which is very slow and time, consuming process. In this age MCB
even does not have a partially computerized system where as other new
competitor banks are now going towards on-line banking services.
Govt. should take keen interest to recover its bad debts, which can improve its
financial position.
In case of giving the loans, it is necessary to check the repute of customer towards
loan repayment. Bank should not advance the money to those people who are
addict of rescheduling of loans due to their political influences. Instead providing
loans to these persons, loans must be advanced to the well-reputed businesses and
industries having good record of loan repayment.
Along with the officers, the training must also be given to the clerical staff.
Because of MCB, are running on manual system and the training of its staff
directly improving their efficiency of work?
Present training program for its officers is need to be improved, as this program
instead of improving the efficiency of officers is merely a burden for the bank in
the form of heavy T.A. , D.A. and cost.
Working conditions must be improved for the employees. Bank will definitely get
more benefits after some expenditure on the working conditions as it improves
efficiency and productivity of the employees.
MCB should flourish certain marketing plans to attract the customers by giving
them certain incentives and beneficial schemes to the customers as other
competitor banks are doing so.
There is also a need of proper recruitment and selection program. New young
talent should be introduced to inject the new ideas.
Deterioration in efficiency is mostly due to promotion without merit. So
promotions must be awarded on merit and when due.
Special attention should be given to the behavior of the employees towards the
customers, as customer is the most important person for any bank.
Many employees are working on ad-hoc basis creating dissatisfaction. The
deserved should be made permanent employees.
Political influences in the bank should be eliminated.
To motivate the employees of the bank, regular bonuses and incentives should be
given to them.
There must be a friendly environment among all the employees as it enhances the
trust and sincerity.
MCB should be focusing its attention towards the share of traveler cheque.
Branch manager should be trained in the field of selling to serve better according
to the expectation of customers.
8. REFRENCES:
12. Annexure:
Organograme of MCB
(Fig. 1)
Chairman
Deputy C E O
Legal
Board of
Directors
Managing Director
GM Marketing
Sale Deptt.
Advertisement
Deptt.
Area Affairs
Relationship Manager
Mr. sarmad
Grade I Officer
Mr. sada husaain
Cash Officer
Mr. Salman
ATM In charged
Mr. Huma
Punjab
732
Sindh
NWFP
Baluchistan
Azad Kashmir
Domestic
Overseas
EPZ
Total
Sri Lanka
Bahrain
282
230
77
71
1392
4
1
1397
3
1
Furthermore, the bank has some proposals under consideration to open more branches in
some European countries and as well as in Japan & china