MCB PVT LTD BRANCH KNL 0920

Internship Report
Of MCB Bank

Fizza Batool
27-Jan-15

A REPORT IS SUBMITTED TO THE DEPARTMENT OF HUMAN RESOURCE

MANAGEMENT GROUP, MCB BANK PVT LIMITED FULFILLMENT OF THE Page | 1
REQUIREMENTS FOR INTERNSHIP COMPLETION CERTIFICATE.
 Acknowledgement

Firstly, all Praises for Almighty Allah who gave me strength, encourage me
& guide me about right and wrong paths & teach me the golden rules that how
could I overcome my problems in efficient way.

Secondly, I want to thank my Parents & Teachers who help me to learn how to live
life, how to compete others & how to face problems. Because of their precious
efforts & by their, I have reached at this level.

I also want to thank my all staff members who teach me about practical life & guide
me that what is banking, what is the purpose of a bank and what a banker do.

I specially thank to;

 Mr. Naeem-ul-Ghani (Branch Manager)

 Mr. Akram Raza (Old Branch Operational Manager)
 Mr. Imtiaz Ahmad (New Branch Operational Manager)
 Ms. Afsheen Rasheed (Supervisor of Branch)
 Mr. Imran Sarfraz (General Banking Officer)
 Ms. Rabia Kanwal (General Banking Officer)
 Ms. Faryal Bashir (General Banking Officer)

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 Executive Summary
MCB (Muslim Commercial Bank) has solid pillars of about 65 years in Pakistan with the
network over 1200 branches. All are programmed branches over 682+ ATM cards in 182
cities nationwide & a network of over 45 banks on MNET, 1-link ATM switch.

MCB operations continue to be modernizing on validation of back-up processing to increase

productivity, enhance of customer services, process efficiently and powerfully controls. The
bank has taken the lead of trading services, foreign trading services, and innovative services
of centralization by improving efficiency, proficiency, capability and reduces delivery cost.

During my internship in MCB (Muslim Commercial Bank), I worked in clearing department,

Customer service office department, Remittance department and Foreign exchange
department. I also learned general banking including Term deposit receipt, Deposit at call
receipt, fixed deposits, Pay orders and Demand drafts etc.

For the duration of my internship, I learned about different kinds of tasks performed in
remittance department, clearing department, customer service office department, foreign
exchange department. I also learned about the communications of bank with customers and
other banks. I also gain knowledge about documentation and keeping records of different
procedures and activities specially marketing facilities.

MCB is become only bank to receive the “Euro Money Award” in 2001, 2003, 2004, 2005,
2006, 2008, 2011 and 2012. MCB has awarded “Best Domestic Bank in Pakistan” in
2004, 2005, 2006, 2008, 2009 and recently 2012. It also awarded by “Asia Money Award”.

In 2013, MCB has awarded with Best Domestic Bank Pakistan, Best Islamic Deal, 1st -
BCR Award 2012 - Banking Sector, Best Website Award and T+1 Cheque Clearing Award
also.

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 Table of Contents:
Serial No. Title of Headings Page No.
1 Acknowledgement 2

2 Executive Summary 3
Brief introduction of the organization’s
3 5
business sector
4 Overview of the organization 6

5 Management Profiles 13

6 Organizational Structure 16

7 Plan of your internship program 18

8 Training Program 19

9 Trend Analysis 28

10 Ratio Analysis 33

11 Future Prospects 54

12 SWOT Analysis 54

13 Conclusions 56

14 Recommendations 57

15 References 58

16 Annex 58

Page | 4
Brief Introduction of Organization’s
Business Sector
Our financial sector evolved very differently from banks in the developed world. For nearly a
year after partition, Pakistan had no central bank. Habib Bank – established in 1941 – filled
this gap initially, until the State Bank of Pakistan (SBP) was set up in 1948 under quasi-
government ownership. The role of domestic banks was particularly limited at the time,
accounting for only 25 of the total 195 bank branches in the country. Therefore, the SBP was
initially mandated to develop commercial banking channels, and maintain monetary stability
so trade and commerce could flourish in the newly-created state. Subsequently, Habib Bank,
Allied Bank and National Bank were amongst the first to start operations with strong support
from the central bank.

Commercial banking grew favorably in Pakistan until 1974. Under the nationalization policy
implemented by Zulfiqaar Ali Bhutto’s government, thirteen banks were brought under full
government control, and consolidated into six nationalized banks. The Pakistan Banking
Council was set up to monitor nationalized banks, marginalizing the SBP’s role as a
regulator.

By 1991, the Bank Nationalization Act was amended, and 23 banks were established – of
which ten were domestically licensed. Muslim Commercial Bank was privatized in 1991 and
the majority ownership of Allied Bank was transferred to its management by 1993. By 1997,
there were still four major state-owned banks, but they now faced competition from 21
domestic banks and 27 foreign banks.

By 2010, there were five public commercial banks, 25 domestic private banks, six foreign
banks and four specialized banks. There are now 9,348 bank branches spread throughout the
country, catering to the needs of some 28 million deposit account-holders.

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 Overview of Organization
Brief History:
MCB Bank Limited (formerly Muslim Commercial Bank) previously named as a
(Mansoor Co-operative Bank) was incorporated by the Adamjee Group on July 9, 1947,
under the Indian Companies Act, VII of 1913 as a limited company. The bank was established
to provide banking facilities to the business community of South Asia. The bank was
nationalized in 1974 during the government of Zulfiqaar Ali Bhutto. This was the first bank to
be privatized in 1991 and the bank was purchased by a consortium of 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 Imran Maqbool. Mian Mohammad Mansha is the
Chairman of the group (and also MCB).

MCB is Pakistan’s fourth largest bank by assets having an asset base of USD 7 billion as at
quarter 1, 2012, and the largest by market capitalization having a market capitalization
recorded at USD 1.2 billion at year end 2011 which was comparatively lower than USD 1.8
billion the year before, mainly on account of lower market value.

The bank has a customer base of approximately 4 million and a nationwide distribution
network of 1,190 branches including 22 Islamic banking branches (December 31, 2011)
within Pakistan and eight branches outside the country (December 31, 2011 including the
Karachi Export Processing Zone Branch), and over 650 ATMs in 110 cities, in a market with
a population of over 190 million.

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Objectives:
 Delivering remarkable returns to stakeholders, sustainable performance,
exceeding market and shareholder expectations
 Providing value added services through operational expansion, geography
and upgraded systems
 Building a corporate culture of equality, trust and team spirit as we remain
dedicated to be a socially responsible organization

Vision Statement:
To be leading financial services provider, partnering with our customers for
a more prosperous and secure future

Mission Statement:
We are team of committed professionals, providing innovative and
efficient financial solutions to create nurture long-term
relationships with our customers. In doing so, we ensure that our
shareholders can invest with confidence in us

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Core Values:
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.

Innovation
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.

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.

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 mak e every
effort to exceed customer expectations through superior services and solutions.

Respect
We respect our customers’ 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.

About MCB:
Since privatization, MCB’s Growth has been exceptional. Today, MCB in one of the
major foreign bank in Sri Lanka, the first bank in Pakistan to launch Global Depository
Receipts (GDR) in 2006, has planned foreign organization with May-bank of Malaysia which
holds 20% shares in MCB has international indirect regional existence in Dubai (UAE),
Bahrain, Hong Kong and Sri Lanka and helping during a Domestic network of over 1,150
branches and over 690 ATMs across Pakistan with a customer base of 4.96 million
(approximately).
Page | 8
Privatization:
Nawaz sharif came into the power on 6 th November 1990, gave proposal for the
privatization of MCB Bank on “15th December 1990” & declared its privatization on “9th
January 1991”.

For almost 30 months while Nawaz Sharif was in power, mainly privatization of MCB to
Mian Mansha and his associates, as an act of preference. Farooq Laghari, finance Minister
during the government of Moeen Qureshi, declared on 18th May 1993 in Senate that MCB
was privatizing.

The President of MCB, Hussain Lawai was selected an advisor of PM. MCB was sold for Rs.
2,420 million against a down payment of Rs. 804 million.

Nationalization:
The Bank was nationalized in 1947 during the government of “Zulfiqar Ali Bhutto”.
This was the first bank to be privatized in 1991 and the bank was obtained by the association
of Pakistani corporate groups directed by Nishat group. As of June 2008, the Nishat group
owns a majority stake in the bank. The President of the bank is M.U.A Usmani.

Founded in 1948, Nishat group is one of the leading and most diversified business groups in
Pakistan. The group has strong existence in the most important business segments of the
country such as banking, textile and insurance.

MCB in Pakistan:
MCB is reputed as one of the soundest financial institution and as one of the leading
bank in Pakistan with a deposit base of PKR 545 billion (approximately) & total assets of
PKR 766 billion. The bank is known as one of the oldest and most responsible banks in
Pakistan and has played significant role in place of the country on global stages while being
one of the few associations is familiar & traded in the international market.

Business Volume of MCB:

Because of achieving its goals, its mission & vision statements and tremendous efforts
of MCB’s chairman and directors, MCB Bank is developing day by day. It is moving towards
modern technologies, building new plans and innovations and providing further
conveniences to its customers. For this reason, MCB is being successful to increase its profit
up to high level.

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Business volume for the year 2013:
Total Assets = 815508 million
Deposits = 632330 million
Advances = 248243
Shareholder’s equity = 97272 milloion
Earnings per share = Rs. 21.24

Nature of the Organization:

The business strategy of MCB is to offer financial solution to main section of its “customer
base”, specifically retail and corporate.
Wholesale Banking group provide to the top level of local and multinational companies. As a
result of organizational restructuring including Investment Banking and complaining up
relationship teams, the group is in line with the industry’s best performance.

Retail Banking Group has meeting point on trading and middle market segment primarily for
building risk assets and trade related business. MCB is offering wide range of trades and
services for its valuable customers i.e. foreign trade, local trade, funds transfer and other
seasonal necessities. With the experience expands in the past few years, the bank is fast
progressing towards becoming the leading bank in consumer business. Other areas such as
Banc-assurance situate innovative records as well by crossing the Rupees 1 billion
benchmark in 2011 owing to the constant purpose to strengthening this product.

Product Lines and Brand Portfolio:

MCB bank is serving people in many ways. It provides facilities to its customers with many
products to satisfy their needs in well-organized way. A list of its products is given below:

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  Current Account  MCB Agri Products
 Basic Banking Account  MCB Trade Products
 Current Life Account  MCB Salary Club
 Savings Account  MCB Investment Services
 Term Deposit  Short & long term investment
 MCB Fun Club – Banking for Kids  MCB Visa Credit Card
 MCB Online Banking  MCB Lite
 MCB MNET  MCB Visa Debit Card
 MCB Cash Management  MCB Gold Plus –The Mobile
 MCB Channel Financing Enabled Visa Debit
 MCB Home Remittance  MCB ATMs
 MCB Motherland Account  MCB Mobile ATM
 MCB Transaction Banking  MCB Mobile
 TBD-Online Fund Transfer (OFT)  MCB Internet Banking
 TBD-Tejarat Card  MCB SMS Alert Service
 TBD-Dividend Warrant  MCB Car4U
Management  MCB Home Loan
 MCB Local Correspondent  MCB Cash4Cash
Banking  MCB Personal Loan
 MCB Corporate Financing  MCB Instant Finance
 MCB Equity Capital Raising  MCB Rupee Travelers Cheque
 MCB Advisory Services  MCB Lockers
 MCB Islamic Banking  MCB Bancassurance

List of main clients:

Main clients of MCB are as follows:

 Nishat textiles  Pepsi

 Adam Jee  Coke
 DG cement  Gourmet
 PSO  Shaukat khanam
 EFU  ENGRO
 MPPL  Edhi
 Utility store  Mobilink

List of Competitions:
MCB Bank has many competitors as a successful organization have but MCB considered
these 5 Banks his main competitors;
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  Alfalah Bank  Summit Bank
 Habib Bank limited  Askari Bank
 Allied Bank limited  Meezan Bank
 Silk Bank  Soneri Bank
 Bank of Punjab  United Bank limited
 NIB Bank  National Bank of Pakistan

Brand Portfolio:
MCB

Bancassurance Self service Traveller MCB Lite& Agriculture

channels Cheques cards

Provide Provide self Provide the Provide MCB lite Provide loans for
Bancassurance services like service of Rupee & different kind agriculture
for the secure MCB mobile, traveler cheque of Visa cards to related services
future of parents SMS alerts etc to for the customers like fisherman,
children the customer customers poultry farm etc
to the customers

Page | 12
 Management Profiles
 Imran Maqbool (President & CEO)
 Ali Munir (Group Head Strategic Planning & Investments)
 Agha Saeed Khan (Group Head Operations)
 Salman Zafar Siddiqi (Chief Financial Officer)
 Ali Mubashir Kazmi (Group Head International Investments)
 Muhtashim Ashai (Group Head Wholesale & Investment Banking)
 Shahid Malik (Group Head CCM (Corporate Communication and Marketing) &
Special Projects)
 Kamran Rasool (Group Head CSR (Corporate Social Responsibility) & Security)
 Mohammad Ramzan (Group Head Treasury & FX (Foreign Exchange))
 Usman Hassan (Group Head Human Resource Management)
 Raheel Ijaz (Group Head Compliance & Controls)
 Laqa Sarwar (Group Head Special Assets Management)
 Syed Rashid Rahman (Group Head Islamic Banking)
 Muhammad Nauman Chughtai (Group Head Risk Management)
 Nadeem Afzal (Head Retail Banking – South)
 Imtiaz Mahmood (Head Information Technology)
 Syed Mudassar Hussain Naqvi (Group Head Legal Affairs)

Board of Directors:
(As of August 13, 2014)

1 Mian Mohammad Mansha Chairman

2 S. M. Muneer Vice Chairman
3 Tariq Rafi Director
4 Shahzad Saleem Director
5 Sarmad Amin Director
6 Mian Raza Mansha Director
7 Aftab Ahmad Khan Director
8 Mian Umer Mansha Director
9 Dato' Seri Ismail Shahudin Director
10 Ahmad Alman Aslam Director
11 Muhammad Ali Zeb Director
12 Mohd Suhail Amar Suresh Bin Abdullah Director
13 Imran Maqbool President & CEO

Page | 13
Audit Committee:
1 Ahmad Alman Aslam Chairman
2 Tariq Rafi Member
3 Aftab Ahmad Khan Member
4 Dato' Seri Ismail Shahudin Member

Business Strategy & Development Committee:

1 Mian Mohammad Mansha Chairman
2 S. M. Muneer Member
3 Mian Raza Mansha Member
4 Mian Umer Mansha Member
5 Ahmad Alman Aslam Member
Mohammad Suhail Amar Suresh Bin
6 Member
Abdullah
7 President & CEO Member

Human Resource & Remuneration Committee

1 Mian Mohammad Mansha Chairman
2 Mian Raza Mansha Member
3 Ahmad Alman Aslam Member
4 President & CEO Member

Risk Management & Portfolio Review Committee

1 Mian Umer Mansha Chairman
2 Sarmad Amin Member
3 Muhammad Ali Zeb Member
4 Mohd Suhail Amar Suresh Bin Abdullah Member
5 President & CEO Member

Committee on Physical Planning & Contingency

Arrangements Page | 14
 1 Sarmad Amin Chairman
2 S. M. Muneer Member
3 Mian Umer Mansha Member
4 President & CEO Member

IT Committee
1 Mian Raza Mansha Chairman
2 Aftab Ahmad Khan Member
3 Ahmad Alman Aslam Member
4 President & CEO Member

SBP Report Compliance Monitoring Committee

1 S.M. Muneer Chairman
2 Sarmad Amin Member
3 Ahmad Alman Aslam Member
4 President & CEO Member

Write Off & Waiver Committee

1 Mian Mohammad Mansha Chairman
2 Tariq Rafi Member
3 Aftab Ahmad Khan Member

Page | 15
 Organizational Structure
Organizational Hierarchy Chart:
MCB

Board of
Director

Corporate President Audit &

Affairs RAR

Risk Treasury Wholesale Retail

Managemen Forex Banking Banking
t

Legal Operation Strategic IT

Affairs Planning

Compliance Financial Special Asset Islamic

Control Control Managemen t Banking

Special HR CSR &

Projects Management Security

Page | 16
Branch Hierarchy Chart:
Branch Manager
Naeem-ul-Ghani

Branch Operation Manager

Imtiaz Ahmad

Teller Service Supervisor

Afsheen Rasheed

General Banking Officer General Banking Officer General Banking Officer

Ms. Rabia Kanwal Mr. Imran Sarfraz Ms. Faryal Bashir

Cashier Teller Service Officer

Mr. Salman Jamil Mr. Zulqurnain

Page | 17
 Comments on the organizational
structure
The structure of MCB is pretty managed and well controlled. It is divided into divisions and
departments. Each division is liable to achieve its targets so that the organization can overall
achieve its goals.
Various Key Performance indicators are used to evaluate and to compare the overall
performance of MCB. There are departments with watching eyes that whether each
department is performing its duties or not. In this way these divisions and departments make
the organizational structure strong.

Plan of My Internship Program

Brief Introduction of Branch:
MC B (Muslim Commercial Bank)
Name of Branch MCB Bank
Branch Code 0920
Region Lahore
MCB Bank, Islampura branch,
Address Alamgeer Road, Krishan Nagar,
Lahore.
Phone No. 042-37325071
Fax No. 92-42-37210851
Name of Branch Manager Mr. Naeem ul Ghani
Name of Branch Operational Mr. Imtiaz Ahmad
Manager
Name of my supervisor Mr. Akram Raza
Number of Employees 8

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Starting and Ending dates of internship:
Starting & Ending dates of my internship
Starting Date: 15 th Dec 2014 Ending Date: 26 th Jan 2015
Duration
Sr. # Name of Departments
Starting Date Ending Date
1 Account Opening 15th Dec 2014 19th Dec 2014
2 Act as a CSO 22th Dec 2014 26th Dec 2014
3 Clearance Department 29th Dec 2014 2nd Jan 2015
4 Cheque Book 5th Jan 2015 9th Jan 2015
4 Remittance Department 12th Jan 2015 16th Jan 2015
5 Lockers processing 19th Jan 2015 22th Jan 2015
6 Sales 23rd Jan 2015 26th Jan 2015

Training Program
Detailed Description of Operations of
Department:
Audit Functions:
 Statements of affairs:

Printing should be filled, No working day missing, all prints should be signed by the BM &
BOM

 Control Assessment Checklist:

Files should be dully filled & signed

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 Account Opening Forms:
Official signatures are required, KYC report should be attached, and valid CNIC, Verysis &
income proofs should be attached.

 Account Closed:

There should be proofs of account closed which have been closed on customer’s demand,
signature card should be crossed, Account Closed stamp should be marked, un-used
checkbook should be attached

 ATM deletion:

There must be entry of deleted cards in the register. ATM & pin code Register shouldn’t be
missing dates, title of accounts, account numbers, card numbers & there should be
customer’s sign.

 ATM issuance Form:

There should be Copies of valid CNIC, Authorized sign should be available, customer’s sign
should be verified, address & phone number should be mentioned on the form.

 Claim Form:

Customer’s statement should be there, after the settlement, there should be reminder forms,
filled properly although in case of delay in claim settlement.

 ATM Cabin:

There should be proper lighting, Help line, Dustbin, Cleanliness, door lock and camera etc.

Cheque book Issuance:

 Cheque book issuance Register:

Customer’s name, account no., date and bank officer’s signature should be there.

 Deletion of Cheque book record:

There should be dates and stamp of deletion after 180 days, if a customer didn’t come to
receive this cheque book.

 KM Reports:

All issuances should be signed of official and should be attached with daily vouchers.

Clearance Department:
 Inward / outward clearing:
Page | 20
 It should be signed by clearance officer & BOM

 Cheque returns register:

It should be customer’s sign, official’s signature.

 CC Register:

Register should be completed with reminder letter of cheque crossing the TAT
(Turn aground time).

Remittance Department:
 Rupee traveler cheque Registers:

There should be reporting letter for issuance of RTC above Rs. 500,000/.

 FDA:

FDA special rates approvals should be maintained with branch record.

 Call Deposit receipts:

Customer’s signs, paid dates, verifications and official’s signatures should be

maintained properly.

Locker Processing:
 Locker Room:

Locker room should be neat & clean and should be safe.

 Locker Register:

There should be customer’s and official’s signatures while using lockers

 Locker Issuance file:

There should be all records of customers with their locker numbers & forms.

Dormant Operations:
 Locker room should be neat and clean
 Chairs and Tables should be available
 New books of addition & deletion, circular files should be in use
 Personal files of Security guards containing CNIC copy, NADRA Verysis, license of
guns should be maintained Page | 21
  Leaving records application should be approved by HR department
 First Aid box should be contain different pain killers, bandages, Dettol, Cotton, seizer
etc
 DVR system & cameras should be places in hidden places

Detailed Description of Task Assigned to

Me:
During my internship, they assigned me different tasks to perform which improve my
knowledge and also enhance my skills of performing task with others like a group & build my
confidence too. And I also learnt how practically tasks are done in actual.

Account Opening Department:

While working in account Opening Department, I made documentation of customers who
want to open their accounts in MCB bank.

 Firstly, I saw their valid CNIC, if they haven’t a valid CNIC, there should be NADRA
Token & a valid CNIC of their family member is also required.
 Secondly, I asked them about their sources of income and checked their income proofs
like job visiting card, in case of partnership of business, partnership deed is required
or any other thing mentioned by customers.
 Thirdly, I filled their account opening forms and arrange all documents like, copy of
CNIC of customer and his family member, Signature specimen Card, Cheque book
issuance slip, ATM form, Verysis, KYC Form etc.
 Finally, I send these forms to BOM for the signs of officials. These forms send to head
office after proper documentation.

Act as a CSO:
I also act as a Customer Service Officer and perform different task e.g.

 Deal the customer and guide them where want to go

 Issue statements to the customers
 Tell their account balances using bank special software for this task on BT (branch
transaction) as per customer request
 Flooring

Clearance Department: Page | 22

I made local clearing as well as intercity clearing. During this period, I perform following
tasks:

 Make entry in excel sheet

 Stamping of clearing with the date of one day later
 Stamping of “Payees account credit”
 Make bundle cover in which I state no. of instruments & total number of cheques

While making intercity clearing:

 Make entry in intercity clearing register

 Make stamping
 Attach cheque with bundle cover

Cheque book Issuance:

While performing this task:

 Firstly, I made the entry of new cheque book in check book issuance register when it
comes from head office
 I made entry of cheque book in excel sheet
 I attach the request slip with cheque book

When a person come to receive its cheque book:

 I detach the request slip at the time of issuance

 Attach it with the daily vouchers
 Receive sign of customer on cheque book issuance register

Remittance Department:
While working in remittance department, I made CDR (call deposit receipt) & TDR (term
deposit receipt);

 Firstly, I fill the form according to customer’s requirement

 Get sign of customer and give customer copy to him
 Make entry in register
 Get sign of official

I also get information about:

 Pay Orders
 Demand Drafts
 Foreign remittance
 Mail transfer Page | 23
Locker Processing:
While performing locker processing, I perform following tasks:

 I fill up the form of locker according to the customer’s requirement

 Attach the copy of CNIC of customer
 Attach Signature Specimen Card with form

Sales:
While performing other tasks, my supervisor assigned me a task of gather customers and
issue VDC (Visa Debit Card). While acting upon this task, I made following activities:

 I convince them for VDC by telling them advantages of VDC

 Fill the form of VDC according to customer’s necessities
 Attach valid CNIC copy of customer
 Get signs of officials after proper documentation

Page | 24
Techniques of retaining customers:
 Training of employees to take care of customers:

Show your customers how important they are, give them respect & care and serve them with
value-able products.

 Solve their problems on time:

Handle the customer’s problems & issues, listen them with positive attitude and solve their
troubles with relax mind.

 Keep customers happy:

You can keep them happy in different ways, like call them by their names, greet them, feel
them important & provide incentives.

 Customer’s feedback:

Keep in touch with customers, be aware of customer’s need & wants, listen their complaints
& problems, know the customer’s behavior and their likes & dislikes.

 Make all things easy for them:

Any transaction or any dealing, in which customers want to involve bank, make that
particular dealing easy for them, make them convenient, and provide them comfort.

 Be professional but helpful:

Being professional in your work but help them also, always put a smile on your face. Make
memorable interaction with customers.

Page | 25
Techniques of attracting new customers:
We can easily attract new customers by:

 Training employees to get new customers

 Providing new products and services
 Maintaining ongoing keep in touch
 Developing database
 Buying capable guidance
 Create an attractive profile
 Developing marketing techniques
 Attractive advertising
 By meeting people
 Building relationships
 Enhance face to face communication
 Do not afraid of customers
 Giving them reasons to join you

Page | 26
Ways of handling Different kind of
customer:
 Normal customers:

These customers do not create problems. But if they are facing problems in some situations,
we should solve their problems.

 Ladies Customer:

We handle ladies customers with polite behavior, and provide them a helpful environment in
which they can easily adjust.

 High Value customers:

These customers contributes their deposits in bank so if they face problems in different
situation, we should handle them with positive attitudes and offer drinks and tea to them.

 Furious customers:

These customers over react in simple situation, we can handle them with normal attitude
listen to them. Firstly offer the glass of water to them, Listen to them carefully and talk to
them in such a way that they can easily understand.

 Disable customers:

These customers treated with polite manners we can handle them by fulfill their needs that
they want to do.

 Illiterate customers:

We can help them by feeling their checks and deposit slips and refer them where they want to
go.

 Problem creating customers:

These customers create problems in many ways. We can handle them by complete their
requirements as soon as possible.

Page | 27
 Trend Analysis
Trend Analysis includes two types of analysis. Those are as followings;

1. Horizontal Analysis
2. Vertical Analysis

Horizontal Analysis:
Statement of Financial Position
11 Vs
2013 13 Vs 12 2012 12 Vs 11 2011
10

Rs. Mln % Rs. Mln % Rs. Mln %

Assets
Cash and balances with 4% 8%
treasury banks 59,946 57,420 53,123 17%

Balances with other banks 1,537 29% 1,192 -48% 2,281 54%

Lending to financial
1,225 -21% 1,551 62% 955 -78%
institutions
Investments 449,006 12% 402,069 27% 316,652 49%
Advances 248,243 4% 239,583 5% 227,580 -11%

Operating fixed assets 28,595 20% 23,738 8% 22,008 5%

Other assets 26,956 -35% 41,520 33% 31,184 13%

815,508 6% 767,075 17% 653,782 15%

Liabilities
Bills payable 10,139 2% 9,896 5% 9,467 -8%

Borrowings 38,543 -51% 78,951 102% 39,101 52%

Deposits 632,330 16% 545,061 11% 491,189 14%

Deferred tax liabilities 4,201 -56% 9,530 47% 6,488 31%

Other liabilities 20,064 -5% 21,166 15% 18,378 14%

705,277 6% 664,604 18% 564,622 16%

Net Assets 110,231 8% 102,471 15% 89,160 13%

Represented By
Share capital 10,118 10% 9,199 10% 8,362 10%
Page | 28
Reserves 46,601 5% 44,253 5% 42,186 5%
Inappropriate profit 40,552 14% 35,425 23% 28,724 34%
Surplus on revaluation of 12,959 -5% 13,594 37% 9,887 -1%
assets - net of tax
110,231 8% 102,471 15% 89,160 13%

Profit and Loss Account

2013 13 Vs 12 2012 12 Vs 11 2011 11 Vs 10
Rs. Mln % Rs. Mln % Rs. Mln %

Mark-up earned 65,064 -5 68,356 0% 68,147 24%

Mark-up expensed (27,196) -1 (27,500) 16% (23,620) 31%

Net mark-up income 37,868 -7 40,856 -8% 44,526 21%

Provisions & write off 2,888 -1093 (291) -93% (4,168) 13%
Net mark-up income after
40,756 0 40,565 1% 40,358 22%
provisions
Non-mark-up income 11,171 22 9,153 13% 8,112 29%

Non-mark-up expenses (19,639) 9 (18,077) 6% (16,987) 29%

Profit before taxation 32,288 2 31,642 1% 31,483 20%

Taxation (10,793) -2 (10,969) -9% (12,058) 29%

Profit after taxation 21,495 4 20,673 6% 19,425 15%

Interpretation:

Asset base of the bank has increased considerably over the past 6 years; highest increase was
observed in 2012 where assets have increased by 17%, mainly contributed by investments in
terms of volume. On an annualized basis, the asset base has recorded an increase of 13%
over the last six years with major contributions coming from investments. Highest increase in
investments was posted in 2009 summing up to 73%, followed by 49% increase reported for
2011.

The deposit base of the Bank has increased considerably over the years growing from Rs. 330
billion in 2008 to Rs. 632 billion in 2013 translating into an annual growth of 14% over past
6 years. Equity of the bank has also posted healthy increase due to higher profitability in past
6 years, translating into 14% average growth over 6 year period.

Moving on to Profit and Loss side, gross markup earned has posted an average increase of
10% over a span of six years.
Page | 29
Corresponding to the shift in asset mix, contribution from income on investments has
increased over years. The increase in markup expense on deposits is on account of regulatory
revisions enacted by the Central Bank and increased deposit base. In 2008, minimum deposit
rate (MDR) was set at 5% by the Central Bank. In 2012, the MDR was revised to 6% on all
local currency saving and fixed deposit products. In 2013, two regulatory revisions were
enacted; computation of interest on average balance basis and pegging of MDR with the
floor rate of the repo corridor.

Non Markup income have shown steady growth of 14% average over 6 years while PBT and
PAT have shown 8% and 7% average growth in past 6 years. Non markup expense has
shown 19% average growth over past 6 years which is in-line with the operational growth
and inflationary surge over the past few years. Provision against advances and investments
has been on the decreasing trend with reversal to the tune of Rs. 2.8 billion recorded for
2013.

Page | 30
Vertical Analysis:
Statement of Financial Position
2013 2012 2011
Rs. Mln % Rs. Mln % Rs. Mln %

Assets
Cash and balances with treasury banks 59,946 7% 57,420 8% 53,123 8%
Balances with other banks 1,537 0.2% 1,192 0.2% 2,281 0.4%
Lending to financial institutions 1,225 0.2% 1,551 0.2% 955 0.2%
Investments 449,006 55% 402,069 52% 316,652 48%
Advances 248,243 30% 239,583 31% 227,580 35%
Operating fixed assets 28,595 4% 23,738 3% 22,008 3%
Other assets 26,956 3% 41,520 5% 31,184 5%
Total 815,508 100% 767,075 100% 653,782 100%

Liabilities
Bills payable 10,139 1% 9,896 1% 9,467 1%
Borrowings 38,543 5% 78,951 10% 39,101 6%
Deposits 632,330 78% 545,061 71% 491,189 75%
Deferred tax liabilities 4,201 1% 9,530 1% 6,488 1%
Other liabilities 20,064 2% 21,166 3% 18,378 3%
Total 705,277 87% 664,604 86% 564,622 86%

Net Assets 110,231 14% 102,471 13% 89,160 14%

Represented By
Share Capital 10,118 1% 9,199 1% 8,362 1%
Reserves 46,601 6% 44,253 6% 42,186 6%
Inappropriate profit 40,552 5% 35,425 4% 28,724 5%
Surplus on revaluation of assets - net of
12,959 2% 13,594 2% 9,887 2%
tax
110,231 14% 102,471 13% 89,160 14%

Page | 31
Profit and Loss Account
2013 2012 2011
Rs. Mln % Rs. Mln % Rs. Mln %

Mark-up earned 65,064 85% 68,356 88% 68,147 89%

Mark-up expensed (27,196) -36% (27,500) -35% (23,620) -31%

Net mark -up income 37,868 50% 40,856 53% 44,526 58%

Provisions & write off 2,888 4% (291) -0% (4,168) -5%

Net mark -up income after
40,756 53% 40,565 52% 40,358 53%
provisions
Non-mark-up income 11,171 15% 9,153 12% 8,112 11%

Non-mark-up expenses (19,639) -26% (18,077) -23% (16,987) -22%

Profit before taxation 32,288 42% 31,642 41% 31,483 41%

Taxation (10,793) -14% (10,969) -14% (12,058) -16%

Profit after taxation 21,495 28% 20,673 27% 19,425 25%

Interpretation:

Vertical analysis highlight over the last three years signifies higher concentration
levels of investments and advances in the asset base of the Bank. The advances base of the
Bank has posted moderate growth over the last few years due to the lack of credit
opportunities and intense competition impacting earning potential. Resultantly, the
significant increase in deposit base has been invested in T-Bills and PIBs over years with a
substantial increase in the concentration levels from 48% in 2011 to 55% in 2013.

Corresponding to the infrastructural and operational growth registered by the Bank, the
deposit base has increased considerably over the period of six years. Improved quality
service levels and tailored products have earned the loyalty of our customers. The fact can be
substantiated with the fact that the CASA base of the bank has been above 80% over the last
many years.

Markup income growth has been steady over the last 3 years. On an average, the
contribution from markup income approximates 88% of the total revenue. Markup expense
has increased over the last 6 years, based on regulatory revisions enacted over the period
and growth registered in the deposit base. Non markup income has a steady concentration of
almost 12% of gross revenue.

Page | 32
 Ratio Analysis
Liquidity Ratios
Liquidity ratios measure the ability of unit to meet its short term obligations and reveal the
short term financial strength or weakness.

Current Ratio:
Current ratio measures the bank’s ability to meet its short term obligations. It is calculated
by dividing the current assets over current liabilities. It is expressed as follows,
Current Ratio = Current Assets / Current Liabilities
Years 2013 2012 2011
Current Assets 786,913,033 742,160,538 631,225,320
Current Liabilities 701,076,017 655,006,088 558,135,855
Current Ratio 1.122 1.133 1.131

Current Ratio
1.135
1.13
1.125
1.12
1.115
2013 Current Ratio
2012
2011

Page | 33
Acid Test Ratio:
It is calculated by subtracting advances from the current assets and then dividing it over
current liabilities. It is expressed as follows,

Acid Test Ratio =Current Assets - Advances / Current Liabilities

Years 2013 2012 2011

Current Assets - Advances 538,670,068 502,577,218 405,424,061
Current Liabilities 701,076,017 655,006,088 558,135,855
Acid Test Ratio 0.7683 0.7673 0.7264

Acid Test Ratio

0.77
0.76
0.75
0.74
0.73
0.72
0.71
0.7
2013 Acid Test Ratio
2012
2011

Page | 34
Cash Ratio:
It is calculated by dividing the cash over current liabilities. It is expressed as follows;

Cash Ratio = Cash / Current Liabilities

Years 2013 2012 2011

Cash and Balances with
59,946,150 57,420,129 53,122,522
Treasury Banks
Current Liabilities 701,076,017 655,006,088 558,135,855
Current Ratio 0.086 0.088 0.095

Cash Ratio
0.095

0.09

0.085

0.08
2013 Cash Ratio
2012
2011

Page | 35
Working Capital Ratio:
Working capital is the difference between current assets and current liabilities.

Working Capital = Current Assets – Current Liabilities

Years 2013 2012 2011

Current Assets 786,913,033 742,160,538 631,225,320
Current Liabilities 701,076,017 655,006,088 558,135,855
Working Capital
85,837,016 87,154,450 73,089,465

Working Capital

90,000,000
85,000,000
80,000,000
75,000,000
70,000,000
Working Capital
65,000,000
2013 2012 2011

Page | 36
Leverage Ratios
These ratios are intended to address the firm’s long-run ability to meet its obligations, or its
financial leverage.

Total Debt Ratio:

This ratio takes into account all debts of all maturities to all creditors. It is computed as;

Total Debt Ratio = Total Liabilities / Total Assets

Years 2013 2012 2011

Total Assets 815,508,371 765,898,992 653,233,223
Total Liabilities 706,277,390 664,148,186 564,430,741
Total Debt Ratio 0.866 0.867 0.864

Total Debt Ratio

0.868
0.867
0.866
0.865
0.864
0.863
0.862
2013 Total Debt Ratio
2012
2011

Page | 37
Debt–Equity Ratio:

Debt–Equity ratio = Total Debt / Total Equity

Years 2013 2012 2011

Total Equity 110,230,981 101,750,806 88,802,482
Total Liabilities 706,277,390 664,148,186 564,430,741
Total Debt Ratio 6.4 6.5 6.4

Debt-Equity Ratio
6.6
6.5
6.4
6.3
6.2
2013 Debt-Equity Ratio
2012
2011

Page | 38
Equity Multiplier:

Equity Multiplier = Total Assets / Total Equity

Years 2013 2012 2011

Total Assets 815,508,371 765,898,992 653,233,223
Total Equity 110,230,981 101,750,806 88,802,482
Equity Multiplier 7.4 7.5 7.4

Equity Multiplier = 1+ (Debt-Equity Ratio)

Equity Multiplier
7.6

7.5

7.4
7.3
7.2
2013 Equity Multiplier
2012
2011

Page | 39
Interest Coverage Ratio:
Also known as Times Interest Earned (TIE) ratio, refers to the ability of the firm to
cover is interest obligations.

Interest Coverage Ratio = Earnings before tax and interest (EBIT) / Interest

Years 2013 2012 2011

Earnings before tax and
59,484,099 59,553,763 55,103,453
interest (EBIT)
Interest 27,195,894 27,500,019 23,620,274
Interest Coverage Ratio 2.19 2.17 2.33

Interest Coverage
Ratio
2.4
2.3
2.2
2.1
2
2013 Interest Coverage Ratio
2012
2011

Page | 40
Cash Coverage Ratio:
Interest Coverage Ratio = Earnings before tax and interest (EBIT) / Interest

Years 2013 2012 2011

Earnings before tax and
59,484,099 59,553,763 55,103,453
interest (EBIT)
Depreciation 1,541,314 1,378,970 1,114,998
Interest 27,195,894 27,500,019 23,620,274
Cash Coverage Ratio 2.24 2.22 2.38

Cash Coverage Ratio

2.4
2.35
2.3
2.25
2.2
2.15
2.1
2013 Cash Coverage Ratio
2012
2011

Page | 41
 Asset Management or Turnover Measures
The measures in this section are sometimes called Asset Utilization Ratios. These are
intended to describe how efficiently or intensively a firm uses its assets to generate sales.

Inventory Turnover:
Inventory Turnover can be calculated as:

Inventory Turnover = Interest Earned / Advances

Years 2013 2012 2011

Interest Expensed 27,195,894 27,500,019 23,620,274
Advances 248,242,965 239,583,320 227,580,139
Inventory Turnover 0.110 0.115 0.104

Inventory Turnover
0.115
0.11
0.105
0.1
0.095
2013 Inventory Turnover
2012
2011

Page | 42
Receivables Turnover:
Receivables Turnover can be calculated as:

Receivables Turnover = Interest Earned / Lending to Financial Institutions

Years 2013 2012 2011

Interest Earned 65,064,123 68,356,191 68,146,588
Lending to financial
1,224,638 1,551,472 955,087
Institutions
Receivables Turnover 53.13 44.06 71.35

Receivables Turnover
80
60
40
20
0
2013 Receivables Turnover
2012
2011

Page | 43
Payables Turnover:
Payables Turnover can be calculated as:

Payables Turnover = Interest Earned / Bill Payables

Years 2013 2012 2011

Interest Expensed 27,195,894 27,500,019 23,620,274
Bill Payables 10,138,726 9,896,284 9,466,818
Payables Turnover 2.68 2.78 2.50

Payables Turnover
2.8
2.7
2.6
2.5
2.4
2.3
2013 Payables Turnover
2012
2011

Page | 44
Total Assets Turnover:
Total Assets Turnover can be calculated as:

Total Assets Turnover = Interest Earned / Total Assets

Years 2013 2012 2011

Interest Earned 65,064,123 68,356,191 68,146,588
Total Assets 815,508,371 765,898,992 653,233,223
Total Assets Turnover 0.080 0.089 0.104

Total Assets
Turnover
0.15
0.1
0.05
0
2013 Total Assets Turnover
2012
2011

Page | 45
Capital Intensity Ratio:
Capital intensity ratio can be calculated as:

Total Assets Turnover = Total Assets / Interest Earned

Years 2013 2012 2011

Interest Earned 65,064,123 68,356,191 68,146,588
Total Assets 815,508,371 765,898,992 653,233,223
Total Assets Turnover 12.53 11.21 9.59

Capital Intensity
Ratio
15
10
5
0
2013 Capital Intensity Ratio
2012
2011

Page | 46
 Profitability Measures
These ratios are intended to measure how efficiently the firm uses its assets and how
efficiently the firm manages its operations.

Profit Margin:
Profit margin can be calculated as:

Profit margin = Profit after Tax / Interest Earned

Years 2013 2012 2011

Interest Earned 65,064,123 68,356,191 68,146,588
Profit after Tax 21,495,338 20,673,002 19,424,906
Profit Margin 0.33 0.30 0.29

Profit Margin
0.34
0.32
0.3
0.28
0.26
2013 Profit Margin
2012
2011

Page | 47
Return on Assets:
Return on Assets can be calculated as:

Return on Assets = Profit after Tax / Total Assets

Years 2013 2012 2011

Total Assets 815,508,371 765,898,992 653,233,223
Profit after Tax 21,495,338 20,673,002 19,424,906
Return on Assets 0.026 0.027 0.030

Return on Assets
0.03

0.028

0.026

0.024
2013 Return on Assets
2012
2011

Page | 48
Return on Equity:
Return on Assets can be calculated as:

Return on Assets = Profit after Tax / Total Equity

Years 2013 2012 2011

Total Equity 110,230,981 101,750,806 88,802,482
Profit after Tax 21,495,338 20,673,002 19,424,906
Return on Equity 0.195 0.203 0.219

Return on Equity
0.22
0.21
0.2
0.19
0.18
2013 Return on Equity
2012
2011

Page | 49
 Market Value Measures
This group of measures is based, in part, on information not necessarily contained in
financial Statements, like market price per share. These measures can be calculated directly
only for publicly traded companies.

Earnings per Share:

Earnings per Share (EPS) can be calculated as:

EPS = Profit after Tax / Number of shares Outstanding

Years 2013 2012 2011

Profit after Tax 21,495,338 20,673,002 19,424,906
Number of shares
10,118,461 9,198,601 8,362,365
Outstanding
EPS 2.12 2.25 2.32

Earnings per Share

2.4
2.3
2.2
2.1
2
2013 Earning per Share
2012
2011

Page | 50
Book value per Share:
Book value per Share can be calculated as:

Book value per Share = Total Equity / Number of shares Outstanding

Years 2013 2012 2011

Total Equity 110,230,981 101,750,806 88,802,482
Number of shares
10,118,461 9,198,601 8,362,365
Outstanding
Book Value per share 10.89 11.06 10.62

Book Value per Share

11.2
11
10.8
10.6
10.4
2013 Book Value per Share
2012
2011

Page | 51
Price/Earnings Ratio:
Price/earnings ratio can be calculated as:

P/E ratio = Current Market Share Price / Earnings per Share (EPS)

Years 2013 2012 2011

EPS 2.12 2.25 2.32
Current Market Share Price 281.17 209.76 134.60
P/E ratio 132.6 93.2 58.0

Price/Earnings Ratio
140
120
100
80
60
40
20
0
2013 Price/Earnings Ratio
2012
2011

Page | 52
Market-to-Book Value Ratio:
Market-to-book value ratio can be calculated as:

Market-to- Book value ratio = Market value per Share / Book value per Share

Years 2013 2012 2011

Current Market Share Price 281.17 209.76 134.60
Book Value per share 10.89 11.06 10.62
Market-to-Book Value Ratio 25.82 18.97 12.67

Market-to-Book
Value Ratio
30

20

10

0
2013 Market-to-Book Value Ratio
2012
2011

Page | 53
 Future Prospects of Organization
In future MCB is planning to enlarge its MCB Islamic banking Network. Financing proposals
are under process at various stages and likely to be extended in the near future. To address
their future growth they are overseeing a reliable and secure communications infrastructure
with the capacity to their growth. The Bank has carried out an assessment of its future capital
requirements in accordance with Basel III regulations which are being phased in over
subsequent periods, and the existing capital structure comfortably supports future growth.

Its aim is to float the products and services that could help improve the life of customers,
masses and communities in which it operate. In the past the Bank has developed a strong
product portfolio that has brought innovative solutions, innovative front-end services and
improvement in customer dependency. Recognizing the need for securing future leadership
capability and achieving strategic viability, MCB has incorporated the Succession
Management initiative in its HR policy, as part of its organizational development efforts. The
Bank has formulated a comprehensive succession plan for critical positions to ensure
operational continuity and grooming of talent for subsequent elevation to higher assignments.

SWOT Analysis of the Organization

SWOT analysis is an analysis which describes the strengths, weakness, opportunities &
threats of the organization.

Strengths:
The strengths of MCB bank are as follows:
 Online branches
 Good Reputation
 Extensive Network
 Quick banking services
 Flexible environment
 66 years of establishment
 Largest Bank
 Additional Deposits
 Banking Procedures Page | 54
 New products & services
 Strategic alliance
 Well furnishes branches

Weakness:
Weakness of MCB bank is as follows
 Lack of managerial trainings
 Limited foreign branch network
 Lack of motivation of employees
 Unawareness of products in customer’s mind
 MCB as a private sector
 Shortage of counter services
 Delinquency of time
 Deficient in marketing
 Lack of information technology
 Deliberate process development
 Slow procedure because of tatally centralized

Opportunities:
MCB bank has following opportunities such as:
 Develop E-transactions
 Enhance sales of RTC (Rupee traveler cheque)
 New products of financing services
 Advertisements
 Enlarge foreign network of branches
 Anti-money laundering techniques
 Improvement in Information technology

Threats:
MCB has following threats:
 Changing in government rules & regulations
 Low discount rates
 Decline in treasury bills discount rates
 Decrease in customer purchasing power
 Inflation rate
 New foreign banks
Page | 55
 Repayment of tax to exporters
 Conclusion
As well as my opinion is concerned, and after doing a whole analysis about MCB’s all
sections, I conclude that no doubt bank is trying to give its best effort to develop the
organization as a whole but consumer banking should expand its opportunities,
customers want to be comfortable by the products and services provided by bank, that
will give huge profit to bank. Customers are facing main problem to pay the high markup
rate on credit card, running finances, demand finances and other loans. MCB should
introduce a new policy in which they offer suitable rates to customers as well as adopt
discount policy. Bank should provide relieve to customers in buying any product or
service like CDR, TDR, pay order, DD, online transfer etc. As per bank’s policy MCB
staff should free the customers in 4-6 minutes. So, they should work more efficiently.
MCB should make a new strategy to overcome its weaknesses.

Page | 56
 Recommendations for Improvements
 Proficiency:

Bank should be proficient in his working. If, it conducts mistakes in handling customers, it
should apologies for it to keep & build good relations with customers.

 Entertainment:

Regional manager & ROM should arrange the parties and get together of their regions to
gather the staff for providing entertainment or to discuss their problems on Branch level with
each other. Because of this reason, they met each other and build good relations with one
another.

 One-window policy:

One window system should be implemented in all branches but due to some reasons, there
are only few branches in which this policy is introduced. This policy should be implemented
on all branches to give comfort to the customers and reduce problems of them.

 Reward system:

Reward system introduced by MCB bank. But in many branches, this system is not
implemented. It should be executed in all branches as necessary to satisfy the employees and
motivate them to work efficiently.

 Training programs:

Bank introduced test & training sessions earlier. Staff of bank is not interested in taking part
in it, MCB staff should take participate in those training programs to enhance their skills,
knowledge & learning.

 Advertising & promotion:

MCB bank should make creative advertising on media in launching a new product or service
to attracting new customers to convince them to buy that particular product.

Page | 57
 References
For preparing this Report, I collect information from different sources such as:

 Brouchers
 MCB’s website http://www.mcb.com.pk
 Staff members
 Manager and supervisors
 Other concerned persons

Annexes
 http://www.mcb.com.pk
 https://www.mcb.com.pk/assets/MCB_Annual_Report_2013.pdf
 https://www.mcb.com.pk/assets/documents/financial_statements/MCB%20Annual%20
Report__2012.pdf
 https://www.mcb.com.pk/assets/documents/financial_statements/MCB%20Annual%20
Report_2011.pdf
 http://en.wikipedia.org/wiki/MCB_Bank_Limited

Page | 58