Department of Management Sciences

Dedication..

I DEDICATE THIS INTERNSHIP REPORT TO MY PARENTS, MY TEACHERS,MCB BANKs STAFF ANDMANAGEMENT STAFF OF MY UNIVERSITY

ACKNOWLEDGEMENT

All the praise of Allah, the most merciful, kind and beneficent and the source of all knowledge, wisdom within and beyond my comprehension. He is only God, who can help us in every field of life. All respect and possible tributes goes to my Holy Prophet Muhammad (SAW), who is forever guidance and knowledge for all human beings on this earth.

I am swollen with pride to say that I am very appreciative to my family whose kind prayers and collaboration helped me at every step of my work. Special thanks go to my parents for their collaboration for the sake of my familiarity.

I would also like to thank Manager of MCB for providing me the opportunity to have an excellent learning experience during my internship. His critical comments on my work have certainly made me think of new ideas and techniques.

This report reflect the knowledge which I have gain from my precious teachers.I acknowledge with deep gratitude which I have gained a lot from my valuable teachers.

EXECUTIVE SUMMARY

To interpret my skills and educational knowledge of Finance I have done my internship in MCB BANK LIMITED GATWALA branch, and to know how I will work in financial institution and among various types of people have different attitude.The objective of this internship was to explore the issues to finance and to find out problems regarding the theoretical concepts with practical working experience in an organization during the internship and learning the institute of MCB BANK LIMITED.

There are many possible improvements, which we make positive changes in the system The description is base on my two months internship program in MCB bank. The tactic report for compilation of statistics is most important as glowing as resultant information.

The principal foundation of in sequence is my individual examination while operational with organization and having conversation with them.The report summarize the MCB bank with its working divided into three parts deals with the description of the MCB the second part covers the theory and practices adopted by MCB and third part discuss the financial position of MCB, its analysis and at the end of concluding remarks and suggestions are gives for improvements. It was too a great deal for me to portray the implementation of such an inestimable institute bordered by the restrictions. In malice of this I try my finest to illustrate.

During my internship at the MCB, I worked in remittances, advances, cash, deposits, customer service department office and successfully completed all tasks and duties were allocated to me. It also performs different functions in all departments as a whole. Therefore in the internship report on muslim commercial bank(MCB) is presenting true facts of this MCB bank branch and overall of this organization. The main of this internship report on mcb was to display a background picture of this organization as well as its SWOT analysis of MCB.

TABLE OF CONTENTS

srTopicsPage no.

1Executive summary

4

2Introduction of MCB

6

3History of the organization

6

4Vision and Mission Statement

10

5Our Values11

6Departments of MCB12

7Products14

8Learning

24

9SWOT Analysis

28

10Main issues30

11Findings31

12Conclusion32

13Recommendation

33

14References34

INTRODUCTION OFMCB

Muslim Commercial Bank is one of the leading banks of Pakistan with a deposit base of about Rs. 462 billion and total assets of around Rs.605 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 Banks 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.

HISTORY OF THE ORGANIZATION

The history of MCB can be divided into three main Phases:

Development Phase Nationalization Phase Privatization Phase

DEVLOPMENT PHASE

MCB Bank Limited 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 with a view to provide banking facilities to the business community of the South Asia. After thepartition of the Indo-Pak subcontinent, the bank moved to Dhaka (then the capital of former East Pakistan) 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. Thus,the bank inherits a 70 years legacy of trust of its customers and the citizens of Pakistan. MCB Bank is not an overnight success story. It started with a share capital of Rs 30 million which is divided into 3 million ordinary shares of Rs 10 each.

NATIONALIZATION PHASE

The 1960s decade is stated as the golden era in Pakistans economic and financial development. The banking sector also registered noticeable growth during that period and lent a strong helping hand to the government to achieve rapid economic growth of the country. But in early 1970s this scenario changed altogether. The separation of East Pakistan (now Bangladesh) and induction of the government led by Zulfiqar Ali Bhutto were the most significant events of early 70s having far reaching effects on the banking system. In the wake of rapidly changing conditions of the country, the government decided to nationalize all the commercial banks so that the nation as a whole can benefit from a better use of resources. Consequently, the Muslim Commercial Bank was nationalized under the Banks (Nationalization) Act, 1974 promulgated on January 1, 1974. In the banking sector, the then government decided to retain only five major banks by merging all the smaller banks with the large ones. As a result of this policy, the Premier Bank was merged into Muslim Commercial Bank in 1974.

PRIVITIZATION PHASE

This was the first bank to be privatized in 1991 and the bank was purchased by a consortiumof Pakistani corporate groups led by Nishat Group.The banks after nationalization came under political and bureaucratic control and deviatedfrom normal banking practices. Some of their senior executives were tempted to nurture aculture of obliging big businessmen, feudal and political influential. They sacrificed theirpersonal integrity and interest of banking sector for gaining promotion and accumulatingpersonal wealth. That is how banking sector started losing its upright and professionalinstitutional image from mid-80s and its downward slide started which touched new lowduring 1990s.The then PML government also became conscious of the falling standard of the bankingsector and decided to privatize all the commercial banks. Banks (Nationalization) (SecondAmendment) Ordinance 1991 was also promulgated to pave the way for privatization ofBanks in Pakistan. In the wake of above amendments, 26% shares valuing Rs. 149.8 millions of the MuslimCommercial Bank, held by the State Bank of Pakistan were sold and the Banksmanagement was transferred to the purchasers of these 26% shares.Mian Mohammad Mansha is the Chairman of the MCB and has played instrumental role inits success.PRESENT POSITION OF MCBOverall performance of the banking sector during the year remained under pressure due to challenging operatingenvironment with high level of competition and economic uncertainties. Under these challenging conditions, banks profit (before tax) increased by 2% while profit (after tax) increased by an impressive 4% over last year. These strong results translated into a healthy ROA of 2.72% and ROE of 23.09%. From a peak of 14% in June 2011, the discount rate declined 400 basis points over the last two years, forcingnet margins to follow a downward trajectory. To counter this declining trend, MCB focused on other business avenues i.e. trade, capital markets, treasury, other fee based income streams and recovery of NPLs to remain on the path of sustainable profit growth. Loans to customers (net volume) increased by 4% reflecting improving business optimism in the economy. The Banks asset base grew by 6% to Rs. 815 billion during 2013. MCB Bank followed its credit underwriting standards and actively pursued remedial risk management resulting in a 9% reduction in its infected portfolio. During the year, deposit base registered a robust growth of 16% with continuous focus on Current and Savings deposits, resulting into an alltime- high CASA composition of 90%. In line with Banks Five Year Business Strategy, our financial results reflected strong underlying performance across virtually all our businesses, fueled by strong Balance Sheet management and profit growth. We also maintained our leadership positions and continued to gain market share in key areas of our franchise. This financial performance has resulted in good stock performance to support growth in market capitalization. Over the years, Bank has earned a series of accolades fromprestigious institutions and during the year another award was conferred by The Asset; declaring MCB Bank Limited as the Best Domestic Bank. This goes, hand in hand, with highest entity rating of AAA (long-term) and A1+ (short term) assigned to MCB by Pakistan Credit Rating Agency (PACRA) in 2013. On the spectrum of social responsibility to the community, Bank donated Rs. 25 million for Earthquake Relief Fund for Baluchistan, while charity contribution of Rs. 5 Million to the Earthquake Relief fund and Rs. 5 million for rehabilitation of minority community were made by MCB. Taking into account the importance of international footprint to serve growing customer base, MCB is exploring various viable options to widen its business network into South Asia, Middle East, Africa and Europe. Similarly, in-line with SBPs strategic focus on Islamic banking, MCB is working actively towards establishing its own dedicated Islamic Bankto take the first mover advantage in serving growing Islamic Banking customer base which currently represents 12% of the overall banking system in the country. On behalf of team MCB, I extend my heartiest gratitude to the Chairman and Board of Directors of MCB Bank for their vision, foresight and guidance in achieving 2013 results. I would also like to thank State Bank of Pakistan and other regulatory bodies for their continued support, our shareholders for their trust and belief in us, and last but not the least, management and staff of MCB Bank Limitedfor their teamwork, unity of purpose and faith in God in translating our goals for 2013 into reality. Based on the successful 2013 results and our business momentum going forward, I expect 2014 to be yet another banner year. We will continue to remain prudent in areas of risk, cost, investment and will be using our strong balance sheet strength to service customer needs, distinguishing MCB as the most credible bank and making it Bank for Life for our stakeholders. MCB has significant contributions in building & strengthening both corporate and retail banking sector in Pakistan. MCB Bank Ltd in 2009 delivered a profit before tax of Rs. 23.2 Billion registering a growth of 6% over last year. This growth is directly attributable to an increase of 14% in CASA deposits, 21% in revenues and a tight control on expense base enabling to retain position as one of the most profitable banks in the country. In 2009, MCB delivered a superior return on equity of 27.4% and assets crossed the Rs. 500 Billion mark. This performance is all the more remarkable keeping in view the economic & political challenges faced by the country during this past year and miscreant created issues that MCB specifically grappled with for a large part of the year. MCB fundamental belief is that a financial services company can only succeed if it meets its customers needs. If they can understand customers financial objectives and offer them the right products and services so that they can be financially successful, then MCB Bank will continue to build on its leadership position and provide requisite returns to its shareholders. During 2009. With the launch of MCB Privilege, MCB became the first local bank to offer a dedicated proposition for the affluent segment; to meet the growth and protection needs of customers, we introduced Bancassurance and Investment Products in many of our branches; to enhance transactional convenience for customers, MCB became the first Pakistani bank to launch mobile banking. These coupled with several other initiatives enabled us to continue on the path of growing customer base and profitability.

Vision and Mission Statement

Vision Statement

To be the leading financial services provider, partnering with our customers for a more prosperous and secure future.

Mission Statement

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.

Our Values

These are the standards and principles which determine our behavior and how we interact with our customers and each other:

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.

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.

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

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.

Departments of MCB

ACCOUNT OPENING DEPARTMENT

Account opening documentation is primary contractual relationship between the bank and customers. There are many types of account like saving account, current account, fix term deposit, Basic Banking account, call deposits, profit & loss account, partnership account, joint account, business account etc.

Mostly person wants to open a savings account or fix term deposits or any other. He has to perform some important formalities. People save their amounts in banks to get some profits for their future and to save the money for their future use. Banks earn profits and interests from these accounts. Minimum amount required for the opening an account is 1000 to 5000 depending on account nature and some legal documents are necessary for opening an account.

Any recent bill copy CNICs copy Fathers CNICs copy Employee certificate. Depending on the account nature they required some more documents. And the zakat and taxes apply to accounts. After opening an account the cheque books or ATMs issued to the customers so that they can make their transactions easily or whenever required. ATM provides many facilities to their customers.

CREDIT DEPARTMENT

This is also a very important department in the bank that plays very vital role and it is the main factor for running a banking business. Because banks give loans from the peoples savings to other persons and they pay some interest on that loan amount that becomes banks income. Simply when a local customer comes to the bank he has the direct dealings with the credit manager. Bank offered different type of loans depending on the customers security. Customer has to give some security to the bank for the sake of money. Then banks reserve the papers of customers security and give him a loan for any specific period. Credit manager take the all necessary information from the customer and give him loan with the approval on some simple terms and conditions.

And in circle office there was also credit analyst who keeps the records and information of all the customers who get loan from banks in files and update their profiles weekly or monthly. There was also an officer who deals with the people who come from different branches with their applications of loans and with those people who are not paying their installments on time and try to convince them to follow the banks policy regarding loans.REMITTANCE DEPARTMENT

The remittance department deals with the transfer of money from one place to another. This department deals with the local and international currency transfer and also E-remittance through western union. MCB provides this facility to its customers. The main function of remittance department is the transfer of funds and the transfer may demand draft, pay orders, mail transfer etc depends on the customers demand. There are many types of remittance

Inward remittance Outward remittance Inland remittance Foreign remittance

CASH DEPARTMENT

Cash department is usually to collect and deliver cash. When a customer comes to the bank and wants to issue or deposit amount comes to the cash counter to give or receives amount. So it is the cash officers duty to deposit or withdraw the amount after verification of signature or account number of the customer. Cash officer checks the balance and then pay the amount to the customer. The banker make journal and ledger to enter notify the customer account all the entry is done in the system, and take print of those entry to keep record, and check all the entry are recording right head of account. So all the cash dealings occurred in the banks are over to cash officer and the cash officer is responsible for all the deposits or withdrawals.

CLEARING DEPARTMENT

Clearing department work with provision used for settlements of proceeds of cheque among different through the medium of a clearing house. Cheque are categorized in two kinds same day cheque and normal cheque. Cheque amount more than 5 lacks is same day clearing cheque. And for the same day clearing few charges are charged. All the cheque which drawn from the local branches of other banks are collected through clearing system.

There are two types of clearing:

Inward clearing Outward clearing

Every banker acts both as a paying as well as a collecting banker, it is however an important function of crossed cheque. 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 payments of tuques 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.

PRODUCTS

CURRENT ACCOUNTS:

BASIC BANKING ACCOUNT

Initial balance requirement for this account is Rs.1000. Minimum balance requirement for this account is nil. Profit cannot be calculated on this account. Each month the account holder will be allowed 2 deposit transactions and 2 withdrawal transactions through cash and clearing Transaction over and above the limit will be charged @ 35 per transaction Unlimited withdrawals through ATM.

CURRENT ACCOUNT

Initial balance requirement for this account is Rs.1000. Minimum balance requirement for this account is Rs.10000. Profit cannot be calculated on this account. Rs.50 per month on minimum monthly average balance of Rs.10000 or below the current deposit account.

CURRENT LIFE ACCOUNT

Initial balance requirement is Rs.1000 for this account. Minimum balance requirement is Rs.25000 for this account. It offer free comprehensive life insurance coverage. The minimum balance requirement will be Rs.25000 below which service charges of Rs.50 will be applied.

BUSINESS ACCOUNT

Initial balance requirement is Rs.50000 for this account. Minimum balance requirement for this account is Rs.50000.

SAVING ACCOUNTS:

SAVING ACCOUNT

Initial balance requirement is Rs.1000 for this account. Minimum balance requirement for this account is Rs.10000. Profit calculates on monthly basis but paid into your account after every six month. Minimum rate is 7% per anum. Rs.50 per month on minimum monthly average balance of Rs.10000 or below the saving account.

SAVING 365 GOLD

SAVING 365 GOLD Initial balance requirement for this account is Rs.500000. Minimum balance requirement for this account is Rs.500000. Profit calculated on daily basis Profit paid into your account on monthly basis The higher your balance, the higher your rates Minimum applicable rate is 5%per anum Rs.50 per month, if monthly average balance falls below

SAVING EXTRA

Initial balance requirement for this account is Rs.100000. Minimum balance requirement for this account is Rs.100000. Profit calculates on monthly basis and paid into your account after every month. Minimum profit rate is 5% and maximum profit rate is 8.5%. Rs 50 per month, if monthly average balance falls below. Customer will have up to 3 free over the counter cash withdrawals. From 4th transaction onward Rs.25 will be charge for each transaction. There will be no restriction on cash withdrawals through ATM.

SMART DOLLAR ACCOUNT

Initial balance requirement for this account is $ 10000. Minimum balance requirement for this account is $ 10000. Profit paid into your account on semiannually basis. If deposit in the saving account falls below $ 10000 then the profit would paid at 0.75% per anum, whereas no interest would be paid if the deposit falls below $ 1000.

KHUSHALI BACHAT ACCOUNT

Initial balance requirement for this account is Rs.1000. Minimum balance requirement for this account is Rs.10000. Profit can be calculated on monthly basis but profit paid into your account on quarterly basis. There will be no cheque book for this account.

SAVING MAXIMIZER

MCB is pleased to announce the launch of MCB saving maximizer account, a high yielding saving account for mid-tier new to bank customers. The account will provide customer with a higher yield on saving deposits coupled with discounted instruments and access to the account through remote channels. Following are some of the most important feature of MVB saving maximizer account, Higher profit rate of 7% for balance of Rs.1 to 3 million Profit can be calculated or paid both on monthly basis. Free ATM card with higher daily withdrawals limit of Rs.50000 and point of sale swiping limit of Rs.250000 Free MCB mobile services for convince transaction and payments Emergency withdrawals options through pay orders and account payee cheques. MCB privilege upgrade on maintaining of Rs.2.5 million for 3 months Initial balance requirement for this account is Rs.1 million Minimum balance requirement for this account is Rs.1 million There will be no cheque book use for this account. Customer can apply for a 10 leaf account payee only cheque book Charges for cheque book are PKR 5oo, for pay order is PKr.300. Only one account is allowed per customer Joint account will not be allowed for this product Branch should ensure that at the time of account opening the customer will be given the terms and conditions for this product as well as existing terms and conditions and this sheet is duly signed by the customer. Product can be identified as accounts have product code as MSM (MCB saving maximizer)

SPECIAL RUPEE TERM DEPOSIT:

Initial balance requirement is Rs.500000. Minimum balance requirement for this account is Rs.500000.

OHTER PRODUCTS

BANCASSURANCE:

Combining the best of banking and financial solutions, MCB Banc assurance provides a one-stop shop solution for you by guaranteeing convenience and security with a wide range of products available for all your financial needs. All our plans are specially designed by reputable insurance providers. These companies have excellent experience with insurance products and guarantee that your funds would be in good hands as there is a team of professional investment experts in each company working on making the funds grow higher in a secure manner. Each plan is designed to give you a peace of mind because we know that in the end, its not the years in your life that counts. Its the life in your years. Banc assurance has the following features, Flexi life is a Unit Linked Plan which is subject to investment risk. NJI Life or MCB Ltd does not guarantee the value of Units.The value of units may rise, fall or remain unchanged. No guarantees in respect of any Funds are given by NJI Life or MCB Ltd. The past performance of funds is not necessarily indicative of the future performance of any of these funds.All benefits payable under the policy are subject to applicable laws (financial or otherwise), as they exist in Pakistan from time to time. Unit prices of NJI Life Managed Fund are published in all leading dailies. Please refer to the policy document of this plan. Banc assurance include the following product which are provided to the customers,

Flexi Life Life Partner Edu Care Dream Wedding Capital Sure Retire Easy Income ax Future Assure Protection Plan

LOANS:

Life in the fast lane can be really slow without a car. MCB Car 4 U makes it a breeze to finance/lease your new/used car. So get up to speed, because Kahin Na Kahin Tau Hai1 Car 4 You. Option for financing and leasing Financing tenure from 1 year to 7 years Option for new as well as used card Option for local as well as for imported car. Financing up to Rs 2500000. Option for early payment Option for replacement Lower markup rate Lower insurance rate Minimum 20% down payment Fast and hassle free processing of application

CARDS:

SMART CARD

MCB now brings you MCB Smartcard -a secure and convenient instrument of payment with unmatched functionalities. It provides 24-hour direct access to your bank account.The convenience and flexibility of MCB Smartcard will help you live a smarter life. It not only helps you manage your expenses, but also eliminates undue interest on your day to day credit card transactions. Your balance is always within your reach and you spend accordingly.

MCB VISA PLATINUM

It is with great pleasure that we welcome you to experience the exciting world of MCB Visa Platinum Credit Card a world full of surprises waiting to be explored. With our perfect combination of premier features and superior service, the enclosed rewards and recognition offer you the prestige and luxury of a lifestyle you can uniquely call your own. MCB Visa Platinum Credit Card is the most reliable, competitive and gratifying Credit Card offering a tantalizing mix of luxurious shopping, dining and traveling opportunities which will undoubtedly be a treat for you and your family. It is accepted at nearly 29 million locations in more than 150 countries around the globe and over 30,000 establishments in Pakistan. So make the most of a powerful card and expect what you deserve, a liberating experience that redefines the way you spend. Enjoy the influence of your card as you become platinum.MCB Visa Platinum Credit Card members can avail the comfort of CIP lounges at no cost at all. Just present your MCB Visa Platinum Credit Card and relax in the CIP lounge at Karachi, Lahore and Islamabad International airports. Priority Pass lets you access more than 600 airport lounges in 300 cities & 100 countries. There are free refreshments, internet usage and many other facilities a card member can use. It provides a means to get away from the hustle and bustle of crowded airports and enjoy the privileges it has to offer. The facility can be availed irrespective of the Airline or class of travel. MCB Visa Platinum cardholders will get 5% cash back on international lodging while spending on their card. The product has the following features,Access to over 600 airport VIP lounges in over 100 countries and over 300 cities so you can treat yourself like a VIP no matter where you travel, or which airline and class you fly.Peace and quiet relax and unwind away from the chaos of the airport, and enjoy a range of complimentary refreshments.Full business facilities most lounges offer phone, fax, email and internet facilities, some even have conference rooms.Excellent value for money three membership plans designed to offer you VIP airport lounge access at competitive rates no matter how frequently you travel.

ACCOUNT OPENING

Account opening is the first step towards relationship building between a customer and the Bank. Of all the functions being performed in a branch, the opening of account is highlighted as the most important. Therefore, Branch/Operations Managers are required to involve themselves in opening of new accounts and meet with the prospective customers in order to make reasonable efforts to determine the true identity of the prospective customer.DOCUMENTS REQUIRED FOR DIFFERENT ACCOUNTS: The details of Account Opening Application, Specimen Signature Cards and other documents to be obtained for different types of accounts are as follows:

INDIVIDUAL ACCOUNTS

Application for Opening Account (SF-1AA). Specimen Signature Card (SF-6). Attested photocopy of Computerized National Identity Card (CNIC) or Passport. It is a mandatory requirement to verify the CNIC of the customer before opening the accounts, from NADRA Online system- VERSYS In case of a salaried person, attested copy of his/her service card or any other acceptable evidence of service, including but not limited to a certificate from the employer. In case of illiterate person, a passport size photograph of the new account holder besides taking left & right thumb impressions on the Account Opening Form & Specimen Signature Card In case CNIC does not contain a photograph, Banks may allow the said customer to open the account, subject to provision of the following documents: A copy of the photograph duly attested by gazette officer/Nazim. A copy of CNIC without photograph duly attested by the same person who has attested the photograph as per above. A confirmation in writing to the effect that they have no other document bearing their photograph. Moreover, the particulars/CNIC of such persons must be confirmed from NADRA in writing or through its VeriSys system.

PARTNERSHIP ACCOUNT

Application for Opening Account (SF-1AA). Specimen Signature Card (SF-6). Attested photocopies of Computerized National Identity Card (CNIC) of all partners. Attested copy of Partnership Deed or Letter of Partnership (CF-13), in lieu of the partnership deed, if not available) duly signed by all partners of the firm. Attested copy of Registration Certificate with Registrar of Firms. In case the partnership is unregistered, this fact should be clearly mentioned on the Account Opening Form. Authority letter in original, in favor of the person authorized to operate on the account of the firm.

JOINT STOCK COMPANIES

Resolution of Board of Directors for opening of account specifying the person(s) authorized to operate the company account. Memorandum and Articles of Association. Certificate of Incorporation. Certificate of Commencement of Business. Attested photocopies of Computerized National Identity Card (CNIC) of all the directors.

CLUBS, SOCIETIES AND ASSOCIATIONS

Certificate of Registration issued by the Registrar of Cooperative Societies/ Registration Authority.Bye-Laws/ Memorandum and Articles of Association of the Society containing official seal of the Registration Authority.Permission of the registration authority for opening of Account in the name of Association as required under section 37 (d) of Co-operative Societies Act, 1925.List of members of the Managing Committee duly certified by the Registrar of Societies.Resolution duly passed by the members of Managing Committee in their meeting regarding opening and operation of account in the name of said Society. It must be ensured that the mandate for operation of Account given in the Resolution is not in violation of the provision of Bye-Laws/ Memorandum and Articles of Association.Attested copies of CNIC of the authorized officials/ persons.

AGENTS ACCOUNTS

Certified copy of Power of Attorney Attested photocopy of Computerized National Identity Card (CNIC) of the agent.

TRUST ACCOUNTS

Attested copy of Certificate of Registration Resolution duly passed by the Trustees regarding opening and operation of Account in the Bank in the name of said Trust Deed.Attested copies of CNIC of all the trustees.Certified copies of Letter of Administration/ Instrument of Trust.

MINOR ACCOUNTS

An account in the name of minor is allowed to open by his guardian, preferably jointly in the name of guardian / Minor or Minors, payable to either or survivor opener of the Account.Title of Account is on the Minors Name (As per Form B) &word Minor be added to the Title of Account. In the Account Opening Application, the particulars of the Guardian will be filled out in the column of Personal Information. Attested copy of Computerized National Identity Card (CNIC) of the Guardian.Attested photocopy of Form-B of Minor.

ILLITERATE /PHOTO/ DISABLE PERSONS ACCOUNTS

Attested photocopy of Computerized National Identity Cards (CNIC).Two Attested Photographs. (One photograph shall be pasted on the Account Opening Form and other will be pasted on Specimen Signature Card.Left thumb impression (Right thumb impression in case of female) on the account opening application & Specimen Signature Card (SSC).

GENERAL POLICIES REGARDING ACCOUNT OPENING:

INITIAL DEPOSIT

Initial Deposit must be in Cash. Cheques may only be accepted, as part of initial deposit in case of undoubted parties and on the personal responsibility of Managers. In all such cases, the cheque when tendered if uncrossed should be crossed by the customer before being lodged for clearing / collection. Cheque Book should only be issued after the proceeds of crossed cheque are realized.

EXEMPTION OF SERVICE CHARGES

Accounts maintained by Employees of Government /Semi Government institutions for Salary, Pension & Benevolent Fund purpose including widows/children of deceased employees eligible for family pension / benevolent fund grant etc. in any manner whatsoever.All Collection Accounts i.e. Non-Checking accounts from where the balances / funds as per standing instructions, are transferred to customers main collection account whether daily or on periodic basis.Students Mustahqeen of Zakat Zakat accounts maintained for collection and disbursement of Zakat funds MCB Employees and their spouses

ACCOUNT OPENING DOCUMENT RETENTION

Account Opening Application- SF1AA along with the relevant documents should be kept in Fire Proof Cabinets under Dual control of Operations Manager and Designated Authorized Officer in the branch.

MCB AGRICULTURE PRODUCTS

MCB has been providing finance to the agriculture sector since 1973. With the help of our vast branch network, specialized staff posted in the branches, multiple and diversified product range, we cater to the financing requirements of the farming community spread throughout the country and facilitate in achieving increased productivity.

Shadabi Plan

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.

Khushali Scheme

Under Khushali Scheme loans/finances are allowed for farm/ non-farm credits which include fixed investments/working capital requirements. Amount of finances sanctioneddepend upon the credit requirement and collateral.

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 of tractor for agriculture come commercial. However, the repayment capacity and potential use of tractor will be evaluated at the time of loan processing.

Aabiari Scheme

Under the Aabiari scheme, financing facilities for tube well, other wells, irrigation systemsof all types including sprinklers are covered. The purpose is to facilitate the farmers inovercoming the shortage of water for cultivation/plantation since water is essentialrequirement for crops.

Grower Finance

Grower Finance is a unique way of financing registered/(bonafide) growers/farmers ofsugarcane,cotton and rice(mills).The special characteristic is that the financing facilities areextended 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.

Dairy & Meat Plan

The plan is aimed at promoting the Dairy sector & meat production in the country. Thefarmers are extended financing facilities to purchase dairy animals for milk and for theestablishment of animal fattening stations to increase meat production on commercial line,thus enabling the farmer to create more income.

Murghbani Scheme

Murghbani Scheme covers extensively all requirements of the poultry industry with focus onfacilitating the farmers. We offer financing facilities of all types of activities in the valuechain starting from establishment of poultry farms infrastructure to all requirements in theprocess till the final out put including marketing of the same by the farmers. Value additionprocess by the farmers for poultry processing is also covered under the scheme.

Baghbani

The scheme aims at facilitating the farmers engaged in horticulture by extending creditfacilities covering the entire range of related activities. The proposals are assessed keepingin view the market potential and repayment capacity based on the cash flows of the activity.The farmers are extended all type of credit facilities required to produce fruits & vegetablesof better quality. The repayment of the loan is as per farmer convenience or linked to cropcycle and timings of cash flows. Facilities like running finance, working capital requirements, infrastructure development, machinery & equipment, irrigation etc are allcovered under this scheme.Progressive farmers are specially encouraged.Learning

WORK DONE BY ME:

Week 1-2

Doing flooring and greet customers . Make entry in DAK registered. Fill ATM transaction dispute form for the customers. Handling phone calls. Taking messages over the phone. Fill statement application form for the customers. Do daily branch assessment and maintain a file for it. Do daily telephonic audit of employees and maintain a record for it. Filling of the house of the daily checklist and house keeping. Write customers complains at the portal and make sure that these complains are resolved within turnaround time. Made daily deposit report at the end of each day and send to the are head. Made daily sales team progress report and send to the are head at the end of each day. Learn about over the phone customer services. ACCONTS OPENING DEPARTMENT:In this account department I gain the particle knowledge about opening. This department deals with opening accountand saving account for its customer and all matters regarding there off. The customer opening account/saving accounts can be categorized as following:1) individual2) firm3) company4) trust5) staff6) othersOPENING AN ACOOUNT:

In order to open an account first of all the customer has to fill a form prescribed by the bank. The person is required to bring some reference or introduction for opening the account. Introducer may be a person who has an account with MCB.Some important information regarding introducer e.g. the name and account number of the introduce is written on the space provided on the specimen signature cards. Then in order to find out whether he is a true introducer or not a letter is sent to him thanking him for this introduction, so that any thing wrong may come into notice.General rules for opening an account: One person can open only one account in the same branch with the same category. In the event of death of an account holder the credit balance will be transfer to the heirs of the diseased individual account. Services charges will be deducted periodically as prescribed from time to time on the accounts that are under the limit of specific account. Services charges are not applicable on that accounts that are prescribed as exempted. A distinctive number will be allotted to the each account. The bank can close those accounts that are under the minimum limit of the bank. Any sum to be deposited in the account should be accompanied by paying in slip showing the party account number and the name. Account holder can only withdraw the sum of money by his own account by cheque. Cheque should be signed by the account holder by the specimen given by the bank. Post dated and defective cheque is not accepted. If statement of account spoiled a new will be issued on cost. Any change in the address should immediately communicate to the bank. The account holder wishing to close the account must surrender the cheque book. Account may be transfer from one branch to another same branch without any charges etcWeek 3-4

Observe the process of making entry in ATM fact sheet. Learning bank operation guideline. Observing processing duties performed. Learn how to complete account opening for Checking new account form and make entry in account opening register. Make entry in TDR register. Learn how to fill know your customer form. Learn how to make entry in cheque stop payment register and observe the process. Do the correction of account opening forms and then send them to CPU at nilagum bad through courier.I worked in this department for one week and learned that the acceptance of deposit is the real source of income of a bank. Deposit Department is the backbone of commercial banking.Deposit is often used to describe the money which customers of all kinds leave with the bank. Deposit account can be defined as an account, which is opened to earn interest.The term deposit is highly misleading. It is not something deposited for safe deposit box. Bank deposit is not like that; when one brings currency to the bank for deposit the bank does not put the currency in the vault. It may put small fraction of the currency in the vault as Reserve but it will lend most of deposits to someone else.The entire banking system is based upon borrowing. Like all banks, deposit department has acknowledged its worth as the most important. Almost all the operations generated from the deposit department and with due course of time reflect back to the deposit department. In order to attract funds bank has introduced various types of deposit schemes that may suit the need and tastes of a large number of depositors.

TYPES OF DEPOSIT FACILITY: Deposits are broadly classified into the following three categories:i) Demand depositsii) Saving depositsiii) Time deposits The procedure undertaken upon receiving deposits from the customer is as follows:1) Examining the deposit slip to ensure that the name and the account numbers are clearly indicated.2) Counting the cash/cheque and agree the total with the amount on the deposit slip.3) After that the pay-in-slip is validated for cash transaction/ transfer/ clearing transfer as appropriate before the counterfoil a handed over the customer.4) Cheque assigned by the director, partners, employees of a company, drawn in favor of themselves and credited in their account in the bank are to be scrutinized.

Week 5-6Learn the concept of inward and outward clearing. Learn the concept of within city or intercity clearing as well as CC. Learn how to make entry in clearing register and return clearing register. Learn how to make entry in checquebook register and ATM register. Learn how to issue cheque book and ATM. Observe the cheque transfer process. Observe the foreign remittance process. ISSUANCE OF CHEQUE BOOK:The account holder requests for a new cheque book by presenting the requisition slip along with the authority letter to the concerned officer. His signature was verified before giving him the new cheque book. One or two bank officers have to verify the signature.REMITTANCES DEPARTMENT:I work in this department for one week; this department deals in transfer of money from one place to another or country by:1)Demand draft2)Mail transfer3)Telegraphic transferIn this department internees are advised to observe the working of transfer of money from one place to another place or country by the above mode of transferring money. During my stay in this department I observed that how demands draft be issued. The procedure is as follows:First a bank receives a request from the customer to issue a bank draft. The written request is either in a banks standard from or separate paper signed by the applicant with cash or cheque covering the amount of the draft and other charges of the bank.While issuing a bank draft it is necessary that they should be free from alternations. All the details must be written clearly in ink. After issuing a demand draft it is handed over to the applicant and it advice containing the particulars of the draft is sent to drawer branch with it is necessary information and payment of the draft is made on its presentation or according to the terms and condition of the mode of transfer.

SWOT ANALYSIS

STRENGTHS:

MCB has the highest return on equity among its competitors. MCB has the highest net interest margin as compared to HBL, NBP etc It has lowest average deposit rates. It has a high consumer loan growth rate It has an extensive branch network. It has less exposure to textile sector as compare to peer bank. It has AA+ rating for long term and A+ for short term loans by PACRA showing high credit quality and low credit risk. At present it has the largest ATM network. MCB utilize its assets in efficient and effective manner. It has strong customer relationship. Brand image because of Muslim word in the name in an Islamic country. MCB meeting the challenges of latest technology by introducing smart card and mobile banking. MCB has very stable deposit base. Investing huge sums on human resource and development.

WEAKNESSES:

It has an increasing rate of NPLs (from 4.67% to 6.69%). Less job satisfaction of employees. Does not have international reorganization. Through its investment are increasing but 40% are confined to investment in government securities only. This reduces its return. Political instability distracts the business of banking in Pakistan. Promotions are mainly on seniority basis. It has non aggressive marketing. Decision making process is very slow. The majority of people are not well aware about the products of MCB. Therefore it should advertise extensively especially RTC and Master Cards. Favoritism and nepotism in recruitment. High level of employee turnover.

OPPORTUNITIES:

It can work to improve the conditions of non-performing loans. During the period of recession, it can take advantage of decreased cash reserve requirement. It can expand its Islamic banking. Extra advertisement will enable them to improve their services. It can go to global world to expand its business. New schemes for deposits and finances should be introduced regularly.

THREATS:

Foreign banks in market having more marketing budget. It has also threats from banks including NBP and UBL that increasing their branches network to encourage deposit rising. Threats from government it it raises cash reserve requirement and statutory reserve requirement. It has threats from bank AL-Falah and UBL as far as car financing is concerned. Similarly NBP is a threat in house financing. Rising deposit rates. Decline in public and private sector credit to tight monetary policies. Weak economic condition of Pakistan. Foreign banks are flourishing in field of consumer financing People dont prefer banking culture they mostly prefer cash transaction.

MAIN ISSUES

TechnologicalIssues

Mcb bank has equipped its branches with all major IT tools being used in the industrylike ATMs, fax machines, photocopiers, printers, latest computers and a goodconnectivity architecture, however it has been observed that when its time to work, thereare many failures seen in the different devices used by mcb, especially itsconnectivity architecture and remains offline with the main server, that creates problemsfor the customers.

Lack of Training & Development

There are effective training centers of mcbat Karachi and Lahore. Its employees get to train at the Lahore center. The problem withtraining and development is that it is only available for the officers of the bank and notfor the lower staff members.

No Job Advancements

There is no job advancements procedure for lower staff members or junior executives thathave joined recently atmcb. The main problem that was observed was that thelower staff should be trained about the operations of the bank and also the junior executives should be given promotions by defining the criterias like performance etc.

Under Employment in Some Departments

Although mcbis a very good employer of talented professionals at different branches, however, it was observed that there were some departments in the bank thatlacked the number of professionals in it that resulted in efficiencies in that department.

Not Introducing New Products

Mcbhas a wide variety of financial products to cater to the needs of itscompetitors; nonetheless the main problem seen is that it is not introducing innovative products like other banks in Pakistan, for example they introduced aself depositing machine, a machine that can be used by consumers to deposit money atany time of the day.

FINDINGS The bank should hire new staff in order to overcome the burden. After every year employees must be transferred to the different location in order to share the knowledge with other and transfer them. Bank should advertise on every product to the customer or any other in order to get positive result and have profit maximization. Expenditures must be control, which are very high The process of a transaction should be short in order in save time for both customers and the bank. Staff strength should be enhanced and professional qualified persons should be recruited. It is recommended that proper training be provided to the staff members that will ultimately increase the performance of Bank over all. It is suggested that promotion be given to the staff in due time and on the basis of performance to provide job satisfaction. The Bank should spend on the renovation of the branch so that it will be comfort and provide good sound environment for their employees. Security level must be maintained and checked every customer before entering into the banks premises. All the departments should do their work separately and no one is allowed to interrupt his or her work. Bank should increase its profit by reducing or eliminating there expenses. The Bank should introduce the computers software to copy the heavy load of work and better control.

CONCLUSION

The banking system, as a whole, remains healthy despite the economy going through a period of economic difficulty. The banking sector absorbed the build-up of non-performing loans in the system while maintaining profitability and robust balance sheets. Much of the credit for this must go to the SBP for the policies it has pursued over the last decade to ensure that banks are adequately capitalized and adhere to prudent risk management.

The objectives were targeted towards customers, improved management policies, strong policy framework, improved governance structure, strategic investment initiatives and implementation of cost effective measure across bank. The group structure of the bank individually worked hard in achieving the milestones under continuous monitoring andsupervision of the senior management and Board.

The bank displayed extraordinary results in both financial and non-financial terms. With the banking industry recovering at a steady pace since the 2007 crisis, MCB ensured availing all possible positive opportunities and delivered substantial profits ensuring sound asset growth Financial year 2009 MCB stood up to the challenges and produced significant increases in major areas of its business while maintaining higher profitability, stronger asset base with corresponding increase in equity. The sector also made positive recoveries while heading towards its actual position prior to 2007 and 2008 financial market crisis.

MCB registered continuous positive performance, by delivering PBT of Rs. 23B and PAT of Rs. 15B, with a rise of 6% and 1% respectively, over 2013. Interest Income increased by 29% to Rs. 52B over Rs. 40B in 2013 owing to increased volume and yields. Income earned on advances, representing 70% of the total Interest Income, increased by 21% over Rs. 30B in 2012, to Rs. 36B in 2013. Interest Expense however, also simultaneously increased by 37%, owing mainly to the increased cost of deposits with interest expensed on deposits rising by 47% to Rs. 14B in 2012. Despite this, due to larger proportion of Interest Income, the resultant Net Interest Margin (NIM) of Rs. 36B significantly rose by Rs. 7B, 26% rise over Rs. 28B last year.

Recommendation

There should be authority in every region which ensures efficient flow of communication and its undrestanding.

MCB should immediately talke brave steps towards the welfare of experinced united. In this regard NBP has set best example.

The management should try to decrease job insecurity among the employees.

Training program should be started for internees and newly appointed employees.

The bank charges high service charges as compared to the other banks, so these should be lowered down.

Surveys must be conducted regarding coustomer satisfaction level and all employees of this dept. should look forwared to gettimg feedback whenever possible.

Adding of value added features that offer competitive advantage is also means of avoiding customer dissatisfaction.

Reference

www.mcb.com.pk

Teachers and Bank staff

Bank brochures

MudassrSaeed Branch manager, MCB Bank, Gatwala Faisalabad

Mr. Tanzeem Abbas shah, Operations manager MCB Bank, Gatwala Faisalabad

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