REMEMBER ALLAH AND HE WILL REMEMBER YOU; REMEMBER ALLAH

AND YOU SHALL FIND HIM IN YOUR PATH; IF YOU ASK, ASK FROM ALLAH;
AND IF YOU SEEK HELP, SEEK FROM ALLAH.

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Internship Report

INTERNSHIP
REPORT
MCB Bank Ltd
Department of Business Administration

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SR #

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CONTENTS

Page No

1
2
3
4
5
6
7
8
9
10

Introduction to MCB Bank Ltd

Objectives of the studying of the organization
Management of the Bank
Organizational structure..
Branch Network
Hierarchy of Management MCB.
Organizational structure of HR Department
Plan of internship program..
Product and services of MCB.....
Financial ratio analysis ...

04
07
12
13
15
17
18
20
28
37

11
12
13
14
15
16
17

Performance Management..
Employees Compensation and Benefits
Organizational Career Management..
Critical Analysis.
Recommendations.
Conclusion .
Information about my Branch

43
47
48
50
52
54
55

Muslim Commercial Bank Ltd.

MCB was incorporated in 1947. It is the largest private sector
bank in Pakistan. Over the years it has earned a reputation of a solid &
conservative financial institution. It was nationalized in 1947 along with all
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other private sector banks & was the first to be privatized in 1991. After
privatization, it has made a considerable progress in all areas of
operations & committed to meet the banking challenges of this millennium
also. It has declared the "BEST BANK" six times out of the last seven
years. MCB has one of the largest branch networks with more than 1300
branch offices in Pakistan. This Bank is also going global to explore the
business of the bank.

MISSION STATEMENT
MCB bank's team of committed professionals is dedicated to maintain
long term customer relationships through outstanding service and
convenience

VISION STATEMENT
Challenging and changing the way you bank.

HISTORICAL BACKGROUND
Before separation of Indo Pak, the need for more Muslim banks
was felt. And Muslims having strong financial capacity were thinking to
invest in this sector as well. This was the idea which paved the way for
setting up Muslim Commercial Bank Ltd known as MCB. This was the
third Muslim bank in the subcontinent.

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INCORPORATION
This bank was incorporated under companies act 1913 on 9 th July,
1947 (just before partition) at Calcutta. But due to changing scenario of
the region, the certificate of incorporation was issued on 17th August, 1948
with a delay of almost 1 year; the certificate was issued at Chitagong. The
first Head office of the company was established at Dacca and Mr. G.M.
Adamjee was appointed its first chairman. It was incorporated with an
authorized capital of Rs. 15 million.
After some time the registered office of the company was shifted to
Karachi on August 23rd, 1956 through a special resolution, now recently
the Head office of MCB has been transferred to Islamabad in July, 1999
and now Head office is termed as Principle Office.
This institute was nationalized with other on January 1st, 1974. At
that time it had 506 branches and deposits amounting to Rs. 1,640
million. Although. MCB has a reputation of a conservative bank but
nationalization also left its effects on this institute as well and by end of
year 1991 in which it was privatized the total number of branches were
1.287 and deposits amounting to as high as Rs. 35,029 million.
When privatization policy was announced in 1990, MCB was the
first to be privatized upon recommendations of World Bank and IMF. The
reason for this choice was the better profitability condition of the
organization and less risky credit portfolio which made'' it a good choice
for investors. On April 8th, 1991, the management control was handed
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over to National Group (the highest bidders). Initially only 26% of shares
were sold to private sector at Rs. 56 per share.

DEVELOPMENTS
After privatization, the growth in every department of the bank has
been observed. Following are some key developments:
1) Launching of different deposit schemes to increase saving level.
2) Increased participation on foreign trade.
3) Betterment of branches and staff service level.
4) Introduction of Rupee Traveler Cheques & Photo Credit Card for the
first time in Pakistan.
5) Extended use of information technology which is evident from the fact
that there are 768 fully automated branches, 243 online branches
(integrated networking), 151 ATMS in 27 cities nation wide and a
M.C.B continuously innovate new product.

Objective Of The Studying Of The

Organization

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As we know that this is the age of business and in the fast paced
era, day after day new competitors and modern concepts are found in the
business fields. This entire selection makes the business world more
phobia.
The different banks / organizations are fighting a lot to maintain
their market share / profitability rates and good will along with the
customer satisfactions. To meet there challenges the most competent and
in competitive works and management is required for attaining these
purpose the human resources department and management department
are both responsible to higher the regent works at right their for the regent
job.
The objective of studying and research revolves around the
employment policy at MCB Bank Ltd. As mentioned about the objectives
and functions of HR Department in the National Bank of Pakistan. The
main focus of the MCB HR Department on the requirement and need
assessment, training and development for the organization. On the basis
of the information provided by the different levels and different other
related department the HR Department makes best efforts to analyze all
the said process for the company.

The following are the objectives of Muslim Commercial Bank Limited.

CREATING AND MANAGING VALUES.

The first objective of Muslim Commercial Bank Limited is to create
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and mange the values, which is one of the back bone of the objectives of
any well organized and managed organization.

HUMAN CAPITAL.
The second objective of Muslim Commercial Bank is to take care of
the Human capital which is a necessary thing for the development and
prosperity of any well established organization.

BEST PLACE TO WORK.

The third objective of Muslim Commercial Bank Limited is to make
it a place which is much feasible and comfortable for employees of the
bank. The MCB is always conscious in developing such place where
employees of the bank feel easiness.

TECHNOLOGY.
The forth objective of Muslim Commercial Bank Limited is to bring
new and latest technology in the operations of the bank. At MCB,
technology has a direct relation with your needs; it is a means for creating
value and convenience for the customer. Over the last few years MCB
has invested heavily into strengthening its technology backbone. Today it
is leading the way in banking technology and setting new standards for
the banking industry; penetrating into the local market, listening to the
needs of the people and educating them of simple financial products and
services that create both value and convenience. MCBs strength lies in
providing a technological base at the grass roots level of the society with
a challenge to educate and assimilate such systems across vast cultural
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and economic backgrounds. With over 768 automated branches, 243

online branches, over 151 MCB ATMs in 27 cities nationwide and a
network of over 16 banks on the MNET ATM switch, MCB continuously
innovates new products and services that harness technology for the
customers benefit.

UNDERSTANDING & RELATIONSHIP.

The fifth and very important objective of Muslim Commercial Bank
Limited is to create such an environment which is suitable for creating
understanding and relationship between the employees, thus going
towards the way of development and prosperity. Over the years, MCB has
fostered strong bonds with its customers. Understands them; their needs.
They feel comfortable with MCB; its their bank; it responds to them;
listens to them; partners with them; grows with them. At MCB, banking is
all about being there for people, making a home in their heartscontinuously building relationships on mutual trust and confidence. We
understand that relationships are about expectations-our products and
services are based on your customers, expectations. Be it financing for
personal or business related needs, funds transfer and trade related
facilities or need for different types of deposit accounts, MCB offers you a
variety of products and services customized to satisfy your individual
needs.

UNDERSTANDING CONVENIENCE.
The next objective of Muslim Commercial Bank Limited is to make
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understanding a convenient thing for the whole environment of the bank,

for the purpose of boosting up its values and prosperity in such a
competitive environment. Convenience is what the customer is looking
for; and this is what we at MCB are continuously striving to provide.
Whether it is the 24 hours cash convenience of our ATM network or the
easy availability of financing requirements or simple opening of account,
MCB has tailored its products and services to make your life easier. MCB
knows the particular needs of its diverse customer base d continuously
develop products and services that fulfill these needs.

UNDERSTANDING RELIABILITY.
The last but not least objective of Muslim Commercial Bank Limited
is to make an environment which have an understanding of reliability in
the whole structure of the bank. With a strong financial base, a promising
team and the right resources, MCB has proved to be a reliable partner
indeed. MCB understands the special needs of the business, trading and
agricultural sectors. Strategically located branches in small towns and
cities provide warm services and advice to the small businessmen and
local traders. MCB speaks their language; it understands their needs and
provides tangible results. By responding in a timely manner with a flexible
approach, MCB provides its clients with the reliable financial service and
support they require to successfully achieve their business objectives.
With a solid foundation of over 50 years in Pakistan and having recently
completed 10 successful years of privatization, MCB is strongly
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positioned to lead the banking sector in the new millennium. You can feel
safe in our hands.

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Management of the
organization
MANAGEMENT OF THE BANK
Mian Mohammad Mansha

Chairman

S.M. Muneer

Vice Chairman

Ahmad Alman

Director

Tariq Rafi

Director

Sheikh Mukhtar Ahmed

Director

Mohammad Arshad

Director

Shahzad Saleem

Director

Raza Mansha

Director

Sarmad Amin

Director

Mian Umer Mansha

Director

Imran Maqbool

CEO

Suhail Imran

Director

Raza Mansha

Director

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AUDIT COMMITTEE

Tariq Rafi

Aftab Ahmed

Member

Ahmad Alman

Member

Chairman

CHIEF FINANCIAL OFFICER

Salman Zafar

COMPANY SECRETARY

Muddasar hussain Naqvi

(There are also some other commetties)

Organizational structure
As MCB is a banking company listed in stock exchange therefore it
follows all the legalities which are imposed by concerned statutes
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Mr. Muhammad Mansha is chairman of the company with a team of 10

directors and 1 vice chairman to help in the business control and strategy
making for the company.
Operational Management of the bank is being handled by a team of
10 professionals. This team is also headed by Mr. Muhammad Mansha.
The different operational departments are Consumer Banking & IT
division Financial & Inter branch division Banking operations division HR
& Legal division financial control & Audit division Credit management
division Commercial Banking division Corporate Banking division
Treasury

management

&

FX

Group

and

lastly

Special Assets

Management (SAM) Group.

For effective handling of branches, it has been categorized into
three segments with different people handling each category. These
categories are:
a)

Corporate Banking

b)

Commercial Banking

c)

Consumer Banking

A)

CORPORATE BANKING:
These are branches which have an exposure of over Rs. 100

million. Usually includes multinational & public sector companies.

B)

COMMERCIAL BANKING;
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The branches which has a credit exposure of less than Rs. 100
million but having a credit portfolio of more than Rs. 20 million (excluding
staff loans)
Usually branches in large markets and commercial areas come under this
category.

C)

CONSUMER BANKING
These are the branches which have exposure up to Rs. 20 million

and these include all the branches which are neither corporate nor
commercial branches.
Recently the organizational structure was re-designed as follows:
Province wise branches

Branch Network
The following is the Branch Network of Muslim Commercial Bank Limited.
Sector wise position of circle,
As on 31-03-2014

Branches.
Area Head South

Area Head north

234 Branches

284 Branches

Area Head Centre

Area Head east

text]
384 [Type
Branches

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Overseas Branches
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9
27

EPZ Branch

Wholesale

10

NUMBER OF BRANCHES IN DIFFERENT LOCALITIES

Punjab
Sindh
Kpk

719
274
117

Gilgat
Blochistan
Azad Kashmir
Fata

4
62
26
6

Domestic
Overseas
EPZ

Overseas.
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1217
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Sri Lanka

Bahrain

EZP

Uae

Furthermore, the bank has some proposals under consideration to open

more branches in some European countries and as well as in japan &
china

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Hierarchy Of Management
GRADES OF BANK
SEVP

ESEVP

SVP

VP

AVP

GRADE-1

GRADE-2

GRADE-3
ASSISTANT

Clerical staff

Non-clerical staff

Cashier

Messenger

Technical Staff

Dispatch Rider

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Organizational structure of MCB

The organization has effective HRM department. The bank has HR
manager in every Circle office and as well as in Regional office. The HR
mangers has to ensure the Human Resource effectiveness in his area.
The chart of the organizational structure of HRM Department is as
follows:

Department Head .. Head Office

Divisional Heads

.... Head Office

Regional Head (EVP)

.. Regional Office

Zonal Head (VP)

.. Zonal Office

Branch Manager

..

(VP, AVP, GRADE 1, 2, 3)

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Organizational Structure of HR
Department

Head of HR Deptt:
(S.E.V President)

Group Chief

Regional HR

Regional

Chief

Business Chief

Upto 5 or Less

Above 5 to 16

Persons

Persons

Manager

Manager

(Business)

(Business)

Cashier

16 and above
Persons

Business
Manager
(General)

Manager
(Operation)

Manager
(Operation)

Manager
(Compliance
&HR)

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Plan of internship program

Introduction of the branch: I have completed my 6 week
internship
program in MCB branch located in pahrianwali tehsil
phalia. They are facilitating there customer by given that excellence
of services. They provided different services to there customers, to
fully satisfy there customer need.

Starting

and

ending

date

internship:
Starting date: july 2013
Ending date: September 2013
Name of department in which I got training:

Customer service department

Account opening department

Clearing department

Remittance department

General banking department

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TRAINING PROGRAMME:
For the period of my internship I learned about different
segments. Which are as following?
Customer service department:
Customer service officer is a person whose main function is
to facilitate the customer. As a CSO I performed following function.
Issuing of the deposit slip Issuing slip of the online fund transfer like
(pay order, demand draft etc) Issuing statement, Entertain the
balancing inquiry of the customers.
Account opening department:
During my internship in MCB account opening
is my second assignment which is one of the basic operations of
the bank. Mr. Nadeem helped me a lot and guided me about
procedure and precautions in account opening. I filed account
opening farm to basic information in all aspects. The process of
opening of account is very simple. Functions of account opening
department include
Opening of account
Closing of account
Issuance of cheque book
Types of account:

Current account

Saving account

Term deposit account

Prerequisite for account opening: The person who

wants to open his accounts in the bank he should need
Application
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form: application

form

contains

all

the

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information of the customer in which include residential status,

political status, account type, initial deposit of the customer,
customer CNIC,next of kin and customer business etc
Signature Specimen Card: Signature specimen card is
compulsory for opening an account in the bank. Without getting
the signature of the customer you can not open the account.
KYC (know your customer): is also required for account
opening. It contains all the data of the customer like CNIC number,
address,

phone

number, account

type

customer

signature

etc.During my training in the account opening department I opened

the employees account of TOYOTA GUJRANWALA MOTORS.

Clearing department:
Every bank performs the function of paying and collecting.
The cheque drawn on other bank by the customer of the bank is
collected by the bank for or without charging fees is called
clearing.
Clearing

of

bank

instrument

include

collection

and

payments of cheque, demand draft, payment order and dividend

warrant etc. it is the greatest service provided by the bank. It
facilitates the customer a lot essential function of commercial bank
is to receive deposit and to honor cheque drawn upon them.
Usually cheque is used for making payment to account holder.
Collection and payments of instrument are known as outward and
inward clearing. During my training in clearing department Mr.
Ishfaq and qaisar abbas help me a lot.
Types of clearing:
Following are the three types of clearing;
Outward clearing
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Inward clearing
Same day clearing
Outward clearing:
Scrutiny of the deposit slip:
During my internship in clearing department I check that
deposit slip and the cheque should be properly scrutinized before
accepting them.

Title and account number are mentioned

Amount tallies with that of cheque

The amount in words and figures are same

There are no unauthorized alternation

The amount, account number, and the title of account

in the customer copy are same as in the original pay in slip.

The pay in slip bears the depositors signature and

contact number.
Scrutiny of instrument:
Following point should be properly check

The cheque is not post dated or undated or stale

dated or invalid dated or incomplete dated

There is no unauthorized alteration on the cheque

Payee name and drawer signature is present

Particulars of chque should be written with permanent

The amount in both words and figures is required and

ink.

both should be match

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Any endorsement and special crossing are in order

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Procedure for the outward clearing:

Customer present duly completed deposit slips with this
instrument to the clearing teller. Clearing teller receive deposit slip
and instrument and check deposit slip

Account number and title of account

Signature on the deposit slip along with depositors

contact no.

Amount in words and figures are same/identical

Instrument amount tally with amount mention on

deposit slip.
Scrutinizes instruments.

Validate the customer account number

Endorsement and special crossing are in order

No un_ authorized alteration

Amount in words and figures are identical

The instrument is neither post dated nor undated or

stale
Instrument pertain to with in city

Inter city instrument will be sent via inter city clearing

or collection arrangement.

Than a fix banks clearing stamp and sign off deposit slip
and return customer copy (b) to the depositor customer receive B
copy of slip and leave the branch. Clearing processors endorse and
sign of on the reverse of instrument as per the requirement.
Than detach deposit slip from the instrument and enter
details on manual register or on an excel sheet detail include
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1. Account number
2. Title of the beneficiary
3. Name of bank
4. Name of city
5. Total amount
Same day clearing: customer present duly completed
deposit slip along with the instrument (other than MCB instrument)
to the clearing processor. Clearing processor determine whether it
is same day clearing same is categorize as below.
1. Amount 500k and above
2. Both receiving and paying bank are member of same day clearing
NIFT
3. Cheque is received before 9:30 am

Types of cheque collected by clearing department:

Transfer cheque

Transfer delivery cheque

Clearing cheque

Transfer cheque: transfer cheque is collected and paid by

the same branch of the bank.
Transfer delivery cheque: which are collected and paid by
two different branches of a bank located in same city this is called
transfer delivery cheque.
Clearing cheque: when the endorser and endorsee of
cheque maintain there accounts in different banks the collecting
bank can receive the amount of cheque from the endorsee bank .It
can send its delegate to each of the paying to collect the amount of
cheque. But this procedure is risky and time wasting. It can
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maintain account with different paying bank.

Remittance department:
I have observed about this department that when money is
transferred from one place to another place to accomplish the
requirements of the customers as per order by the customer its
called the remittances.
The need of remittance is commonly felt in commercial life
mainly and in every day life general. A most important function of
any banking system is the transfer of funds from one client or one
place to another. By providing this service to the customer the bank
earns a lot of income in the form of service charges. This
department deals with local currency remittance i.e. remittance
from one city to another without actually carrying the currency.
MCB uses following instrument for transferring of money:

Demand Drafts (DD)

Pay Order (PO)

Telegraphic Transfer (TT)

Mail Transfer (MT)

During my stay at MCB) I have well observed about all of

these modes

General banking department:

in general

banking department is a department in which operational manager

is work. An operation manager is responsible for managing the
employees work schedule, utilize the substantial resources
efficiently managing the every day issues and much more.
Following are the responsibilities of operational manager:
Human resource management
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Asset management
Cost management
Decision making.

PRODUCTS AND SERVICES OF

MCB

Introduction
In the previous chapter a brief introduction/history and different
types of MCB departments are discussed this chapter consists of different
products and services offered by MCB bank. The different types of
accounts offered by MCB bank, the different types of loan schemes
offered the credit cards and master cards etc.

MCB Salary Club

A payroll solution designed to make life easy; it simplifies all the
monthly payroll related banking needs of employers and opens the door
to a world of special offers for employees. Salary Club provides the
convenience of having an extensive range of financial services available
to employees at their place of work.
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Current Account
MCB Bank offers a variety of current accounts to cater the
everyday transactional needs of various customers. These accounts
ensure ease and freedom to bank from any of the 1100+ branches across
the country. The different accounts include: the Basic Banking Account
that has no minimum balance requirement; Business Account offering free
online transactions, Demand Drafts, Pay Orders and lots more to meet
the day-to-day business requirements; Current Life Account that offers the
security of life insurance free of cost; and for all others, the conventional
Current Account.

Savings Account
MCB Bank offers a wide array of savings products that suit shortterm growth and transactional needs. Our savings accounts offer
attractive profit rates as well as flexibility to transact. Savings Extra is
targeted for customers having Rs. 5 million + deposit and 365 Gold offers
profit rates on daily balances with no minimum balance requirements. In
addition, two unique products, i.e. Smart Savings and Savings Maximizer,
are special saving accounts run solely via debit cards and other remote
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end savers

MCB Advisory Services

Financial and Capital Raising Advisory provides our clients with
financial advisory services, commercial structuring support and access to
capital

resources

to

help

companies

successfully

finance

their

business/project.

MCB Islamic Banking

MCB-Islamic Banking Group provides Shariah-compliant products
and services both on the liability and asset sides to various customers of
all demographic segments to cater a wide range of Working Capital,
Capital Expenditures, Trade Business and Consumer requirements. In
addition to existing Shariah-compliant IB products, Islamic Banking Group
also provides customized solutions to its valued customers for execution
of complex financial transactions. Furthermore, Islamic Banking Group
also provides Shariah advisory services in structuring of various
syndicated transactions for its valued customers. To facilitate its valued
clients, MCB-Islamic Banking has also increased outreach of its
dedicated Islamic Banking branches to the tune of 27 in 14 cities across
the country.

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MCB Local Correspondent Banking

Transaction Banking Department at MCB Bank provides Local
Rupee Drawing Arrangement, a product for small banks and financial
institutions to use our vast branch network platform to make payments in
areas where their own branch network does not exist, thus extending their
reach nationwide.

MCB Rupee Traveler Cheque

MCB Rupee Travelers Cheques are as good as cash, in fact
better. Better because with Rupee Travelers Cheques you have the
power to purchase and a feeling of security that should you lose them,
you will get a refund. MCB Rupee Travelers Cheques are accepted at
major shops, travel agents, hotels, business establishments and MCB
Bank branches all over Pakistan. You don't have to be an MCB Bank
account holder to buy the Rupee Traveler Cheques. Anybody can
purchase them. It's a safe and convenient way to conduct everyday
business. At a time when thefts and robberies are on the increase, you
are better off carrying Travelers Cheques rather than money.

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MCB Investment Services

Investment Services operate with the aim to help you make the
most of your wealth with investment opportunities that match your unique
financial aspirations. MCB Bank Investment Services offers distribution of
mutual funds managed by the leading fund managers of Pakistan. We
can suggest the products most suited for your needs, or work with you to
create a personalized solution completely focused on your expectations
of the capital markets.

Consultancy Services
In the process of privatization of public sector units, prospective
buyers need professional assistance and MCB Bank, with its expertise,
offer to them specialize service for valuation of the market value of the
industrial unit, preparing bid documents and arranging finance for the
purchase of the unit.

Self Supporting Scheme

For the benefits of genuine worker/borrowers who are poor and
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needy and for small entrepreneur the bank as evolved a self-supporting

scheme: maximum amount of loan Rs.25000 and minimum Rs.5000 per
individual. Loan will be totally free of mark-up.

Fax Press
This product was first of its kind introduced by using modem
technology of The Fax Machine. It facilitates speedy transfer of funds
within Pakistan. The service guarantees transfer of from one city to
another, within an hour.

MCB Mobile Banking

At the forefront of technological excellence, MCB Bank proudly
introduces MCB Mobile Banking. The convenience of accessing account
balance information and mini statements whenever want or wherever may
need them, with comfort and peace of mind. MCB Mobile Banking service
is available to all MCB ATM cardholders, 24 hours - 365 days.

MCB Car 4 U
MCB car 4 u auto finance is a power move that gets you not only
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a car of your own choice but leads you best in life. It is affordable with
competitive markup, flexible conditioning and easy processing and above
all no hidden cost.

MCB Master Card

Since the beginning of time, people have tried to find more
convenient ways to pay, from gold to paper money and checks. Today,
money is moving away from distinct hard currencies and towards
universal payment products that transcend national borders, time zones,
and, with the Internet, even physical space. Plastic or "virtual" money,
credit, debit, and electronic cash products, inevitably will displace cash
and checks as the money of the future. MasterCard International has
expanded globally in more locations in the world than any other card. The
card was introduced by MCB Bank Limited in 1995 and now offers card
members over 15 million outlets in 232 countries.

Photo security- The first bank in Pakistan to introduce the

enhanced feature
case of card loss.
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Welcomed at over 3, 000 outlets in Pakistan.

Provides up-to 45 days Free Credit.

Joining and Annual Fees to suit you.

24 Hour Customer Services- Call 111-700-700 and you can get

information from our customer services representatives On new
card application or have your queries resolved anytime of the day.

Cash Advance Facilities

Available in Pakistan and worldwide with a network of over 1,000
branches and a team of dedicated professionals, MCB is Pakistans
largest private sector commercial bank.
Our Consumer Banking provides customers with innovative
saving schemes, products and services. Our ATM network is the largest in
Pakistan and our Pak Rupee Travelers Cheques are market leaders. We
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were the first to introduce the photo card with the introduction of the
MasterCard. When it comes to banking practices, you can depend on us.
Weve been around for over fifty years.

MCB 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 live a smarter life. It not only helps you manage
your expenses, but also avoids undue interest on your day to day credit
card transactions. Your balance is always within your reach and you
spend accordingly. MCB bank is the only bank to introduce a debit card
that gives the option to choose from domestic and international card for
local and global usage respectively.

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FINANCIAL ANALYSIS OF MCB

BANK
Introduction to Chapter
In the previous chapter different types of products and services
offered by MCB bank are briefly discussed. This chapter consists of the
analysis of MCB bank which contains the SWOT analysis their strength,
weaknesses, opportunities and threats, and also the financial analysis of
MCB bank through different types of ratio analysis like the current ratio,
debt to equity ratio tec. This chapter further elaborates about the PEST
analysis of MCB bank.

Ratio Analysis
An index that relates two accounting numbers and is obtained by
dividing one number by other Gallagher 2003.

Ratio Analysis is an important and age-old technique of financial

analysis. It simplifies the comprehension of financial statements. Ratios
tell the whole story of changes in the financial condition of business. It
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provides data from inter firm comparison. They also reveal strong firms
and weak firms, over- valued and undervalued firms. Ratio analysis also
makes possible comparison of the performance of different divisions of
the firm. The ratios are helpful in decision about their efficiency of
otherwise in the past and likely performance in future. Ratios also help in
Investment decisions in the investors and lending decisions in the case of
bankers etc. Following are the main types of ratios that I am going to
calculate in this report to compare and highlight the financial performance
of MCB in 2010, 2011 and 2012.

Financial Ratio of MCB BANK

A financial ratio is an index that relates two accounting numbers

and
is obtained by dividing one number by the other. Gallagher 2003
One may ponder that why there is a need to mingle with these
ratios and not take the actual figures straightforwardly. Among various
reasons one cogent reason can be put forward that ratios help in
comparison.

When

ratio

analysts

are

to

compare

the

internal

performance of the organization in relation to time, only ratios are the

viable option for them. Similarly, comparison with the other competitors in
the same industry can only be carried out with the help of financial ratios.
The number of financial ratios the might be created is virtually limitless.
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But there are certain basic ratios that are frequently used, these ratios are
as

Assets Turnover Ratio

Net sale (advances + investment) /Total Assets This shows
revenues generated per rupee investment in total assets. This ratio is
calculated by dividing net sales (advances and investment) by total
assets
.
Table

2010

2011

2012

ATR 0.82

0.862

0.87

Interpretation

This shows revenue generated per rupee investment in total

assets. The Ratio increased from 2010 to 2012.The graph shows a high
increase from 2010 to 2011as 0.82 to 0.862 and then grows slowly to
2012. So we can interpret that MCB is effectively utilizes its resources.

Current Ratio
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Current Assets/ Current Liabilities

Its shows the firms ability to meet its short term obligations. The
higher the ratio, the greater is the companys ability to meet its short term
obligation as the come due. Current ratio is calculated by dividing current
assets by current liabilities
Current ratio 1.12

1.130

1.133

Interpretation
Current Ratio of MCB for the last three years shows an increasing
trend. In the year 2010 it was 1.12 and then it increased to 1.130 in the
year 2011 mainly due to an increase in current assets of the bank. But in
the year 2012 it just increased from 1.130 to 1.134. .This rise in the
current ratio of MCB shows the defensive approach of MCB towards
working capital. This surely improves profitability as the percentage of
current assets.

Debt To Equity Ratio

Total Debt/ Shareholder Equity
Debt Ratio

6.16

6.35

6.52

Net Profit Margin Ratio

Net Profit after Taxes X 100/ Net sale

Net profit margin

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3.60

3.56%

3.26%

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Interpretation
Net profit margin of MCB has shown a fluctuating trend in the
year 2010 it was 3.60% but in the year 2011 it was decreased to 3.56%
and again slightly dropped to 3.26% in the year 2012. This means that
through the selling price has increased the other expenses of the bank
like operating, general administration or selling expenses has shown a
slight decrease.

Debt to Total Asset Ratio

Total Debt/ Total Assets
Debt ratio shows the fraction of the companys assets that is
financed by debt. The ratio is derived by dividing a firm s total debt by its
total assets Debt Ratio

0.860

0.864

0.867

Interpretation
This ratio highlights the relative importance of debt financing to
the firm by showing the percentage of the firms assets that is supported
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by debt financing

Return On Equity Ratio

Net Profit X 100 Total Equity
This ratio shows that residual profit as a proportion of the bank
value of common shareholder equity.
ROE

21.30%

21.90%

20.60%

Interpretation
The ROE of MCB has shown a mix trend. In the year 2010 the
ROI is 21.30% but increased in the year 2011 to 21.90% but in 2012 it
comes to 20.60%. This decrease in ROE is due to un improvement in Net
Profit Margin.

Performance management
Every organization for its smooth working and growth have to
maintain the performance of its employees. Similarly MCB bank Ltd. Is
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maintaining the performance of its employees the bank assess the needs
of its employees and fulfill the requirement of the staff. Which include the
environmental effectiveness and smooth working conditions almost all the
branches of the MCB having better environment and all the facilities for
the employees are available for maintaining performance. The Bank has
great concern for its employees performance maintenance.

Setting performance standards and expectations

Every organization has to set the standard fro the employees to
work better and better the bank MCB has also different standards for its
employees to work better and with the Tendency to increase the
performance effectiveness. The promotion of employee due to good
performance has set the standard for other. Incease in salary, grade,
promotion or the standard for the employees to do better work.

How performance reports are written

Performance reports are very important in the MCB Bank every
employee of the bank receives the performance report from his manager
written by him. Performance reports are written by seeing and keeping in
view the annual performance of an employee. Mostly the managers of the
branch write the report of his sub ordinates. This report is a preset
Performa fulfilled by the manager. This Performa is called performance
appraisal. This report is sent annually to the head office HR department.
The report has great concern and very important of an employee because
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the final promotion after an year based on this performance report. Also
the salary increase depend upon this performance appraisal.

How Performance Reports are written in MCB

MCB Bank Ltd
Emp. No.________________

P.F No._________
ANNUAL PERFORMANCE APPRAISAL
(For Executives & Officers)*
For the year 2007

Part A
Section I. (To be filled in By the concerned Branch / Region / Group)
Name:
Fathers / Husband Name:
Designation:

Grade:

Basic Pay
Rs.

Regular
Contractual

Current Posting: (Branch / Region /

Reporting to**

Date of Joining MCB

Date of Last promotion

Academic Qualification: (Last Degree)

Professional Qualifications:

Group)

Status of Disciplinary actions, if any

Section II (To be filled in By the Appraisee)

Mention your most important achievements during the year

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Section III (To be filled in By the Appraisee)

What training would you like to undertake to benefit you

* Also applicable to all Executives and Officers in the contractual employment.

** (RBS / ROC / RCMC / RCC / RHRC) in case of employees on RO strength and name
/ Designation of Supervisory Executive / Officer in case of employees on HO. strength
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MCB Bank Ltd

Name of Appraisee: _____________________
Part B (To be completed by the appraiser)
Section I.
Performance: Achievement against job objectives (Already agreed)
Rate the performance against objectives:
(1=Poor, 2=Satisfactory, 3=Good, 4=Very Good, 5=Outstanding)
Score
(1 to 5)

Objectives

Total
Total Score of Section I = (Score of Section 1 + Number of Objectives) x 0.7 =
Section II.
Score
(1 to 5)

Behavioral Skills
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.

Job Knowledge
Communication Skills
Attitude, Behavior, & Response to Controlling Offices
Initiative
Attendance and Punctuality
Commitment to Job and Organization
Team work
Analytical ability
Development of subordinates
Personal Appearance and grooming
Total

Total Score of Section II =(Score of Section II + 10) x 0.3 =

Overall Score
=
(Total Score of Section I + Total Score of Section II)
Section III
Signature of Appraisee & Date
(With comments, if any)
(Immediate Supervisor)

Signature of Appraiser & Date

With comments, if any

Countersigned by the Appraisers Supervisor & Date

Name of Region / Group___________________

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Date:____________________

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Employees compensation and

benefits
The bank compensates his employees in every way the bank has
health insurance of the employee and the family of the employee the
bank has also the life insurance of its employees. The MCB bank gives
the different kinds of benefits to an employee having great performance.
These benefits include following things:
Lone for home
Competitive salary package.
Salary advance.
Bonuses on better performance.
Loans.
Scholarships to the children of their employees to get education.
Special acknowledgement certificates.
Better working environment.
Allowances for performing.

Hajj & Umrah for interesting employees

Car lone
Small and medium lone with zero interest rates.
These benefits are very important for the employees and most of
the employees avails these benefits.
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Organizational career management

MCB Bank clearly manage the career of the employees. When a
person join the MCB as an employee have no tension for his career. The
bank is very responsible in career management.

Employee job changes

The bank changes the employees job keeping in view the interest
of the employee for example, a person working in MCB branch office want
to work in HR department bank have no hesitation to transfer the certain
person to the HR department if the person has some potential of HR.
similarly if person want to work in IT division and have great interest in IT
the bank management transfer the person in IT division.

Promotion
The bank MCB promotes its employees for showing the great
performance. This promotion depends upon three points as follows:
1.

Annual promotion

2.

By passing the IBP (Institute of Bankers of Pakistan) exams

3.

Performance appraisal

First of all the bank promote of an employee annually having great

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performance in the certain department. Secondly if an employee passes

the IBP examination in first attempt the bank promote employee to one
higher grade and also give him prize of 50 thousand rupees as gift.
Performance appraisal is key of promotion person can also get promote
by having the effective performance report given by the management.

Transfer
The management can transfer the employee from one office to
another at any time or by the interest of an employee or job requirement
of the bank.

Demotion
Demotion occurs rarely in the MCB bank. The bank do not demote
of the employee until the situation is not for give able.

Termination
The bank can terminate the employee at any time but this
termination of an employee is very rear. Very few people are terminated
since the bank incorporated. These termination are due to very
unforgivable things happened by the employees.

Resignation
If the person working in the MCB bank want to go some other
organization can gives the resign and free to go anywhere but this
resignation should be two month notice to the management or the
employee have to give two month basic salary for resignation.

Retirement
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The bank retires his employees after sixty years of age or twenty
five years of service. This retirement before one year vocation the bank
give the salary of one year to the employee for retirement and then the
whole funds of the employee which include provident funds, life
insurance, health insurance and regular monthly pension.

Critical Analysis
THEORETICAL VS PRACTICAL CONCEPTS SPECIALY FOCUSING
ON HR BECAUSE IT WAS FOUND WEAK.
Although all of the banks HR Departments working is according to
the theoretical concepts but there is a lot of difference on adopting of their
procedure specially.
i. HR Practice.
ii. HR Planning.
iii. Job Analysis.
But it will hot saying useless that in many points the working was as
similar as in theory while working in NBP it has been expired that
following points are considered in fretful position.
i.

Selection Process.

ii.

Internal Recruitment.

iii.

External Recruitment.
But there are no proper arrangements of the followings.

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i. Orientations.
ii. Need Assessment.
iii. Training and Development.
iv. Using of Modern tools.
v. Mostly employees are unaware by using technologic etc.
Although these hurdles are being faced by NBP in limited resources
the bank is moving forward towards its objective very successfully and
following points are taken into consideration very successfully.
i. Performance reports.
ii. Financial awards on achievements.
iii. Helping attitude.
iv. Financial objective.

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Recommendation
MUSLIM COMMERCIAL BANK is performing well. Its deposits are
growing day by day and so its profitability. The controlling body is
responsible for the productive performance of the Bank.
Following are my observation and suggestion to improve the
efficiency for the development of the economy.

Human Resource Department should be more effective and every

branch should give the monthly report of the HR issues to the HR
Department.

There is a criticism on the banking management that the salaries

of the employees are decreasing in every succeeding year. And I
think this will shake the confidence and working habit of the
employees.

There is another recommendation about the bank that there is no

proper timing of the bank and there is made an unnecessary
delay in the banking transactions, which might not be a good sign
for the bank from future prosperity point of view.

Staff turnover particularly of trained staff result in financial and

other losses. The amount spent by the bank on employment,
induction and training of outgoing officers constitutes to beat till
another officer should ready prove this work. The exodus of bank
officer in the past has worsened the situation.

Most of the bank employees, are sticking to one seat only with the
result that they become master of one particular job and loose
their grip on other banking operation. In my opinion all the
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employees should have regular job experience all out-look

towards banking. The promotion policy should be adjusted.

Refresher Courses for the staff are most important in any

international organization. Alt the employees should have these
courses according to their requirement. Foreign experts can also
be called for this purpose.

Every year some of the employees should be sent for training to

other countries and employees from other branches should be
brought here. Some more reading material should be provided.
The purpose should be to educate the employees with the
advance studies in their field. The employee should be provided
the opportunities to attend and participate in seminars and
lectures on banking.

Bank should give some more incentive to its employees in order

to remove the conflict between lower and higher officers and
should try to improve the working condition of the bank.

As such system should be designed that every employee who has

some problems with his officers can communicate it to the higher
management and some steps must be taken to improve that.

Recruitments should be strictly on merit basis and induction

should be after proper and extensive training.

Old and lazy staff should be replaced by young, qualified and

energetic staff.

Foreign branches should be opened in order to capture the

international market and to earn international repute for the bank.

Working environment, equipment, furniture and staff dressing

should be according to the modern banking style.

Proper attention should be paid to upgrade customer services.

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Bank should adopt the global organizational banking structure to

meet the international standards of banking sector.

conclusion
It is evident from this report of MCB that it is making progress by
leaps and bounds. The profits of MCB have grown considerably during
the last few years and this trend is expected to continue into the future.
Therefore, we conclude that MCB has a very prosperous present and
future, which assures the shareholders of wealth maximization. Side by
side of it I think that if bank would be able to cover and control on the
above mentioned recommendations and HR and financial techniques
development then it would be in such a situation that will really lead it
towards the road of prosperity, development and integrity. And then bank
will be really in such a situation and position to compete its competitors in
the country as well as on international level.

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Information About My Branch

I did my internship in Muslim Commercial Bank Limited pahrianwali
situated on phalia road chowk Adda pahrianwali. some important
information about my branch which I observed are as follows:

MANAGEMENT OF THE BRANCH

BRANCH MANAGER;
MUHAMMAD YOUNIS GONDAL.

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