Documente Academic
Documente Profesional
Documente Cultură
Internship Report
MCB Bank
Submitted By:
1018
Mahrukh Waheed
2015-2019
13 Sep 2019
Page 1 of 55
University of Education
Township, Lahore
Department of Economics and Business Administration
LETTER OF UNDERTAKING
Ahmad .Roll No.15-BBA(Hons) 1018 (E). for the partial fulfillment of the requirements for the
degree
BBA (4 years)
Session (2015-2019)
With specialization in
Principal ________________________
Page 2 of 55
ACKNOWLEDGEMENT
First of all I thank my almighty ALLAH. Who give me knowledge and strength and able me to
do my BBA (Hons) in HR.
When I prepared my internship report during the preparation of my internship report I face so
many hurdles and then there is few many people which they help me throughout the internship
preparation and course .
First of all I shall be very thankful of my parents because all the time they encourage me
throughout the course and giving me hope and faintness.
After that I shall be very thankful of the manager of MCB (Ltd). And all the staff of MCB (Ltd).
Branch they help me throughout the internship course.
Page 3 of 55
EXECUTIVE SUMMARY
MCB Bank Limited (Muslim Commercial Bank Limited) has a very solid foundation over 50
years in Pakistan. It has a network of over 1000 branches and above 850 braches are online
branches .MCB has over 350 ATMs in 41 cities nationwide and also has a network over 12 banks
on the MNET switch. During my internship I worked in HR Dep, and I successfully complete all
the tasks that were assign to me. They also permit me to take a look on working of following
departments
Account Opening Department
Clearing Department
Remittance Department
This report is an upshot of my four weeks internship in Muslim Commercial Bank of Pakistan.
MCB of Pakistan possesses an imperative and historical importance in the banking sector of
Pakistan. It always remains the center of hustles in business activities. It always endows with
great covenant of rally round in terms of funds and services at all epochs of its dynamism.
The main purpose of internship is to learn, by working in practical environment and to apply the
knowledge acquired, during the studies, in a real world scenario in order to tackle the problems.
In this report the detailed analysis of the organization has been done and all the financial,
technical, managerial and strategic aspects have been evaluated to analyze the current position of
the organization. Along with it, the background analysis, the prevailing competition analysis, the
business process analysis, and the internal environment and external environment of the
organization have been discussed and the recommendations & suggestions for the improvement
have been made wherever required. During my four weeks internship program, I learned about
different function performed in the bank and I work at all the department of the bank I learned
who to maintained the record and the document of the bank and all the activity.
Duration of my internship six week in a MCB bank (Ltd) branch ISLAMPURA where I learned
the detail work of the different department I work in the various department but I explain those
department in which I got full command during my learning process . The functionS which I
performed are mentioned as under
In my first two weeks I’ll work in the account opening departments. It is important
department of the bank because all the working of the bank base on account and the bank account
shows the deposit of the bank if any person working with the bank or the organization.
Page 4 of 55
During my internship I spent my 3rd week in the cash department and cash department is
totally deals with the cash whether the cash comes in the bank or out from the bank during the
learning in the cash department I learn the all the activities which is perform in the cash
department .
My 4th week during my internship in the credit department. The credit department works
with maintain the loan and credit and also issue the credit after necessary verification and the
security and the guarantee to the desire limit.My 5th week is all about the clearing department. I
learned the work and the function which is performed in the clearing department. I learn that
clearing is the process in which bankers settle there mutual accounts by the claming the arising
account of various instruments presented by one bank drawn on the other banks in a same city or
the out side the city through NIFT (National Institutional Facilitation Technologies). NIFT is the
department of collection of clearing cheques of each branch, these plays middlemen of the bank
and client.My last week is about working in the remittances department. It is very important
department in the current scenario in this department the bank deals with transfer money and
different type of fund and also receive fund from abroad form the Pakistani community and others
as well which is called remittances. At the end of this report there is the ratio analysis of past 3
years. And also the SWOT analysis of this branch which explained the strengths, weaknesses
opportunities and threats of this bank.
Page 5 of 55
Table of Content
Details.
1. Title Page
2. Letter of Undertaken
3. Scanned Copy of Internship Certificate
4. Dedication
5. Acknowledgement
6. Executive Summary
7. Table of Contents
8. Introduction of the Industry
9. Over View of the Organization
10. a. Brief History, Mission and Vision
11. b. Introduction of Organization
12. c. Policy of Organization
13. d. Product Line
14. e. Competitor
15. f. Business Volume
16. Organizational Structure
24. Conclusion
25. Recommendation
Page 6 of 55
27. Annexes
1. INTRODUCTION OF THE INDUSTRY
The Industry I have chosen is banking industry. The banking sector is the lifeline of any modern
economy. It is one of the important financial pillars of the financial sector, which plays a vital
role in the functioning of an economy. They play an important role in the mobilization of
deposits and disbursement of credit to various sectors of the economy.
The Muslim Commercial Bank Limited was incorporated on 9th July 1947 in Calcutta in Bengal.
After partition, the Registered Office of the bank was shifted to Dhaka where it commenced
business from August 1948. The Bank transferred its registered/Head office from Dhaka to
Karachi in 1956. In 1999, its registered / Head office was transferred to Islamabad and Karachi
office was named as principal office. The government transferred a 26% management stake to a
group of leading industrialists, collectively named National Group of which Mian Mohammad
Mansha is the Major stakeholder. In 1992 a further 24% was sold to the National Group. The
current shareholding structure is 50% National Group, 25% government and 25% floated on
bourses.
Over the years Muslim Commercial bank fostered strong bonds with its customers. MCB
understands them; their needs. They feel comfortable with MCB; it’s their bank; it responds to
them; listens to them; partners with them; grows with them. That is why it is one of the leading
commercial banks of the country, providing a wide range of modem banking services. At present,
the banking network consists of over 1000 branches along with – controlling offices known as
Area Head offices and Regional Head offices. These controlling offices are responsible for the
smooth operation of the bank on National & international levels. The entire financial and
operational objectives are achieved with the Human Resources strength over 12000 employees.
The bank is known as the major credit provider, best place of working and paymaster in the
financial (money market) of the country. Over the past few years, MCB's profits have been hit by
the need to increase provisions coverage and restructuring costs associated with the downsizing
of the workforce and branch network, whilst there is some need to boost provisions, these charges
(necessary to bring the bank back into shape) are largely over. It has also slowly received
permission from the SBP to shut down a number of unprofitable branches.
Page 7 of 55
In 1999 EURO MONEY recognized MCB as the best domestic bank in Pakistan.
Corporate Banking Group of MCB is focusing on top tier local corporate groups and
multinationals in a structured and focused manner building relationships leading to increased
market share.
Branches having Advances of Rs.100, 000,000 per party relationship and monitoring such
advances are called as Corporate Branches. These branches include corporate clients and their
requirements are looked after. There are about 20 corporate branches of MCB in Pakistan.
a. BRIEF HISTORY
MCB bank is the one of the leading bank of the Pakistan MCB have the experience over
50 year in Pakistan and the hard work which make it leading organization in the present scenario
.MCB is not make the overnight success story but behind the success of the MCB is the
hardworking and the full dedication .
The history of MCB can be divided into four 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 the partition 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
Page 8 of 55
office to Karachi, Where the head office is presently located. Thus, the bank inherits a 64 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 Pakistan’s 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
consortium of Pakistani corporate groups led by Nishat Group. The banks after nationalization
came under political and bureaucratic control and deviated from normal banking practices. Some
of their senior executives were tempted to nurture a culture of obliging big businessmen, feudal
and political influential. They sacrificed their personal integrity and interest of banking sector for
gaining promotion and accumulating personal wealth. That is how banking sector started losing
its upright and professional institutional image from mid-80s and its downward slide started
Page 9 of 55
which touched new low during 1990s. The then PML government also became conscious of the
falling standard of the banking sector and decided to privatize all the commercial banks.
In the wake of above amendments, 26% shares valuing Rs. 149.8 million of the Muslim
Commercial Bank, held by the State Bank of Pakistan were sold and the Bank’s management was
transferred to the purchasers of these 26% shares. Mian Mohammad Mansha is the Chairman of
the MCB and has played instrumental role in its success.
Vision
To be the leading financial services provider, partnering with our customers for a more
prosperous and secure future.
Mission
We are a team of committed professionals, providing innovative and efficient financial
solutions to create and nurture long-term relationships with our customers. In doing so, we
ensure that our shareholders can invest with confidence in us.
Providing value added services through operational expansion, geography and upgraded
system
Building a corporate culture of equality, trust and team spirit as we remain dedicated to
being a socially responsible organization.
Page 10 of 55
MARKET STANDING
MCB Bank Limited ('the Bank') is a banking company incorporated in Pakistan and is
engaged in commercial banking and related services. The Bank's ordinary shares are listed on all
the stock exchanges in Pakistan whereas its Global Depositary Receipts (GDRs) are traded on the
International Order Book (IOB) system of the London Stock Exchange. The Bank's Registered
Office and Principal Office are situated at MCB -15 Main Gulberg, Lahore. The Bank operates
1,374 branches including 11 foreign branches .and 1 EPZ branch
For effective handling of branches it has been categorized into three segments. These
categories are:
1. CORPORATE BANKING:
These are the branches, which have an exposure of over Rs. 100 million. Corporate
clientele includes public sector companies as well as large local and multinational concerns.
MCB is also catering to the growing middle class by providing new asset and liability
products. Main products of MCB regarding Corporate Banking are:
Cash Management
Working Capital Loans
Term Loans
Trade Finance Services
Investment Banking
2. COMMERCIAL BANKING:
These are the branches, which have a credit exposure of 20 million to Rs 100 million
excluding staff loans. Usually branches in large markets and commercial areas come under
this category. Products offered under commercial banking are:
Deposit Accounts
Loan Products
Master Card
Rupee Travelers Cheque (RTC)
Page 11 of 55
Remit Express
3. CONSUMER BANKING:
These are the branches, which have an exposure up to Rs. 20 million and these include all the
branches, which are neither corporate nor commercial.
c.COMPETITORS
The banking sector in Pakistan making very fast growth and there is many close competitor
of MCB bank of Pakistan
Page 12 of 55
d.BUSINESS VOLUME
Page 13 of 55
d.PRODUCT LINE
MCB bank of Pakistan deals in all the schemes and the services of a bank in a current
scenario there are many sets of financial infrastructure with which the MCB bank is leading in
providing the services to its customers.
Consumer banking
The consumer portfolio, comprising the debit card, credit cards, auto loans, personal loans
and mortgages will be established phase by phase. However, we are confident that our strengths,
together with our largest network of online branches, a superior technology platform, a big
customer base and the Consumer Personal Banking Group (CPBG), will take the Bank’s
profitability to new heights.
Commercial banking
The MCB is also doing the commercial banking and it’s leading in this department
MCB offers retail product to its consumers. The MCB main focus to introduce the various
financing and investing products to its valuable clients, and contributes the steady growth to the
financial industry. The commercial and the retail banking offers the verity of asset and liability –
based.
The MCB bank introduce different type of product and instruments which is mentioned below
1.Islamic banking
2.Deposit Product
Page 14 of 55
Saving account
Current account
Current life account
Foreign currency account
3.Investment Products
4.Loans
Auto loan
Credit Cards
Visa Debit card
MCB visa platinum
MCB visa
.
Page 15 of 55
10.ORGANIZATIONAL STRUCTURE
a.Organization Hierarchy Chart
General Manager
Regional Manager
Branch Manager
Account Opening
Department
Cash Deposit
Department
There are different departments working in this branch. The system of the branch is centralized
and controlled by the Circle Office Neela gumbad. It is hoped that soon this branch will be
made decentralized so that the working can be made more efficient and fast.
There are seven employees working in this branch. Their designation are as followed:
Designation
Branch Manager
Branch Operation Manager
Supervisor
General Banking Officer
General Banking Officer
Chief Teller
Teller
c.MAIN OFFICES
Registered Office MCB Building, F-6/G-6, Jinnah Avenue, Islamabad.
Principal Office MCB 15 Main Gulberg, Lahore.
UAN: (042) 111-000-111 PABX: (042) 36041998-9
Website: www.mcb.com.pk Email: info@mcb.com.pk
Page 17 of 55
Shares Registrar M/s. THK Associates (Pvt.) Ltd., State Life Building No.3,
Dr. Ziauddin Ahmed Road, Karachi
Page 18 of 55
d. Credit department
In this department the bank granted the loan to the customer and there are the different
type of the credit which is provided to its customer during my internship I learned that if some
individual request for the loan then bank granted him a loan according to limit and some
requirement for different kind of loan for example if the organization request for the loan then
bank granted the loan according to some requirement and limits which apply on the organization.
e. Dispatch department
Dispatch department is the very important sector in the bank because all inward and
outward mails in which ordinary and sensitive as well, routed or transfer to this department as the
mail in the branches consists of documents covering title to goods, cheques, inter branch Dr. Cr.
Advices, letter of credit in international banking apart from other routine letters. So it is important
to handle dispatch carefully and make sure there is not wrong devilry
f. Clearing department
There are two type of clearing in the bank and during my internship me doing both type
of the clearing.
Inward clearing
Outward clearing
g. Account department
This is important department in which the account are maintained and also the voucher
and the books and the all the expenses or expenditure of the bank are maintained so it is the most
important department of the bank maintain all the account of the bank is the duty of this
department and this department is working well.
h. Finance department
Page 19 of 55
Financing department is the important department because bank finance in various ways
like advancing the loan and make the profit as a excess amount in the way of interest the MCB
finance in such a way giving the loan to the customer and also buy the share of the private
organization also finance in the agriculture sector and the private sector as well.
Thank fully I did my internship from MCB bank (Ltd) Islampura branch. This
Branch is online branch so I leaned that the working of the management is very smooth and
the efficient.
In this branch I observed that this branch doing a great business and the management
and the staff of the branch is efficient and the professional and the manage handle all the
working of the branch and this branch have the very good contact and the relation with the
shops business entities and the other sound parties as well to increase the deposit of the branch
Page 20 of 55
and maintain the efficiency of the work and enhance the organization.The manager guided to
the different functions operating with in the organization and the sub manager makes sure and
takes the responsibility that staff doing work efficiently in the entire department.
And also the branch is well maintained and decorated and the entire department have separate
place with in the organization to doing there assign duties and the environment of the
organization attract the customer as well which is good for the organization.
c. Names of the departments in which I got training and the duration of my training
During my internship I work almost in the all department and my internship duration
is 6 week I learnt the working of the following department
Cash department
Credit department
Clearing department
Remittances department
During my internship training in the MCB, I worked in different departments and seats and learnt
the followings:
Filling Of Cheques & Deposit Slips
Account Maintenance Dept
Procedure Of Opening Of An Account:
Issuance Of Cheque Book
Clearing Department
a. Account opening department
Page 21 of 55
In my first two weeks I’ll work in the account opening departments. It is important
department of the bank because all the working of the bank base on account and the bank account
shows the deposit of the bank if any person working with the bank or the organization.
b. Cash department
During my internship I spent my 3rd week in the cash department and cash department is
totally deals with the cash whether the cash comes in the bank or out from the bank during the
learning in the cash department I learn the all the activities which is perform in the cash
department.
c. Credit department
My 4th week during my internship in the credit department the credit department is the
one of the most important department of the bank. The credit department is works with maintain
the loan and credit and also issue the credit after necessary verification and the security and the
guarantee to the desire limit and there is the rule and the regulation to issue the credit and loan to
the customers.
d. Cleaning department
My 5th week is all about the clearing department. I learned the work and the function
which is performed in the clearing department. This department the important department of the
bank
I learn that clearing is the process in which bankers settle there mutual accounts by the claming
the arising account of various instruments presented by one bank drawn on the other banks in a
same city or the out side the city through NIFT (National Institutional Facilitation Technologies).
NIFT is the department of collection of clearing cheques of each branch, these plays middlemen
of the bank and client.
The type of the clearing is as under
o Inward clearing/ Local clearing
o Outward clearing/ Intercity clearing
Page 22 of 55
e. Remittances Department
My last week is about working in the remittances department. It is very important
department in the current scenario in this department the bank deals with transfer money and
different type of fund and also receive fund from abroad form the Pakistani community and others
as well which is called remittances
The MCB bank transfer different type of fund through the different services.
TRAINING PROGRAM
I joined Muslim Commercial Bank,. First day I reached there at 9’O clock and reported to
manager who introduced me about the functioning of the branch and its staff. During these two
months I worked in different sections of the branch to learn the maximum practices of banking
system.
GENERAL BANKING
First of all, I was asked to work in different sections of General Banking. Here I was attached Mr.
Ayaz Ahmad who has good command on this section. Here we deal with new customers who
wanted to get information about the branch and will to deal with the branch. This is a very
interesting department because here we met people of different types and deal with them
accordingly.
The document which is used in the opening a new account is as under
Page 23 of 55
1. Account opening form
2. The name of person who request for opening the new account
3. The type of the account
4. Computerized Copy of national identification card
5. Check the expiry date
6. Filled the opening form
7. Signature of the person
8. SS Card (Specimen Signature Card)
9. Mother name
10. Father name
11. Present address
A cheque is presented on the counter with the two signatures of the bearer on the back of
the cheque. Operation’s manager verifies the following points:
1.The cheque number
2.Cheque Date
3.The cheque signature with the signature specimen card position in the officer signature
received at the time of opening the customer’s account in the presence of the officer
4.Cheque amount in figure and words
5.Branch stamp in the front of the cheque
6.Check the nature of cheque, bearer cheque, cross cheque etc.
In the cash department there are fore to five counters in which include
Page 24 of 55
2. Receipt counter or the cash deposit counter
3. Payment of cash and checks
4. Verification and clearance the check and account counter
5. Bill and fee receive counter
During my learning process I learned that first of all issue the token to the customer and then in
the receipt counter receive the cash and maintained the account and then if a customer have a
cheque k then the cheque is verifies by the verification person and then the casher makes the
payment against the cheque and also transfer the money online and maintained the all activities
which is casher duties i.e. give the cash to the valuable customer and the bill and the fees receive
counter receive the bill payment and the fees and maintain all the activities related to bill and fees
collection.
The activities of the cash department of MCB bank (Ltd) is as under
1. Source of cash
2. Management of cash
3. Deposits
4. Demand draft and the online maintains
5. Treatment of surplus cash
6. Treatment of the cash deficit
7. Cash transit
8. Issuance of cash
9. Security arrangements
10. Verification of cheque
11. Receive the bill and the fees collection
A demand draft is provided to the client in whom he has to specify that on which bank it
is drawn. The amount both in words and figures is written on the demand draft.
Page 25 of 55
I spent second week of my training in bills collection department.
Miss Sumaira is the in charge of this section. Here we collected utility bills like electricity bill.
It is most important and interesting department. This section deals with the transfer of money
from one branch to another branch. Nearly six drafts issued daily from this department.
Here I know the amount transferred and what is the procedure. This department also deals with
T.T. transfer of money. I worked nearly three weeks in this department.
DEPOSIT DEPARTMENT.
Deposit department deals with current, saving fixed accounts for a long period.
In current account the bank does not offer any interest you can deposit or withdraw any amount
during banking hours. In PLS account we can only withdraw up to Rs. 25OOO/ without notice
if you want to withdraw more than a notification must he given to the bank. In Fixed account
people normally of old age are more interested because they get a lump sum amount every
month as a markup or interest. These accounts are normally for two to five years.
CLEARING DEPARTMENT.
In clearing department we deal with cheques of our clients drawn on different banks. Here
I also watched the working of clearing house up to 12.00 pm all the branches send their cheques
to main branch. Where they stored and presented in the State Bank of Pakistan. My 5th week is
all about the clearing department. I learned the work and the function which is performed in the
clearing department. This department the important department of the bank
I have learnt that clearing is the process in which bankers settle there mutual accounts by the
claming the arising account of various instruments presented by one bank drawn on the other
banks in a same city or the out side the city through NIFT (National Institutional Facilitation
Technologies). NIFT is the department of collection of clearing cheques of each branch, these
plays middlemen of the bank and client.
Page 26 of 55
There are two types of clearing going in the bank Inward clearing and the Outward clearing .we
can say that the clearing is clear those cheque which cannot be cash at the cash counter of the
bank . the representative of the respective bank collect all the cheque and the instrument which
drawn on there and settle the account and doing the clearing function this assembly of the
representative of the bank is called Clearing house NIFT perform the clearing on the behalf of the
commercial banks in all the cities through out the country.
The type of the clearing is as under
Inward clearing/ Local clearing
Outward clearing/ Intercity clearing
Inward clearing
The instrument and the settlement or the claim by the other banks or the other branches of
MCB on our branch of MCB bank in which include the cheque draft and etc, are drawn by the
other bank customer or by the MCB bank branches in clearing in the inward clearing process
there is few thing include which is mentioned as under
1. Cross stamp on the face
2. Clearing stamp on the front and the back
3. The clearing stamp bearing the date of the next working day
4. Payees account is credited and the stamp on the cheque and signature of the operational
manager
5. And before entering the cheque into the computer the stamp and the signature is to be
verified and the cheque is posted and drafted.
Outward clearing
I learnt about outward clearing in MCB bank clearing department. out ward clearing is
that the settle of claims of our branch of MCB bank or the other branches of MCB bank drawn of
other banks or other branches of MCB bank deposited by our customer in our branches of the
bank , presented by our branch of MCB bank in out ward clearing .
When the cheques of outward clearing is received then it is entered into the clearing registered
Following detail are entered is in the both registered is as follow
1. Serial No.
2. Account no. of the depositor
Page 27 of 55
3. Depositor name
4. Drawer
5. Drawee
6. Cheque No.
7. Amount of the cheque
8. Cross stamp on the face of the cheque
9. And the clearing stamp
10. And the stamp on the back of the check payee account will be credited
The local clearing, a bundle cover is arranged manner the branch code stamp, total amount and
number of instruments. This amount should match the one that is kept in the Clearing Register.
The cheques or the instrument with bundle cover and outline are packed in NIFT bag. Before
putting these items in the bag, a plastic seal number is required and should be written on the
bundle cover and the same seal should be used to close the NIFT bag. This is to ensure additional
safety as when the seal is opened, it is non-replaceable. If the seal number on the bag and on the
bundle cover does not match, it is a suggestion that the bag has been tamper with. Strict action
can be taken by NIFT and the Bank consequently.
Page 28 of 55
STRUCTURE OF HR DEPARTMENT
The HR department of MCB bank is located at Mall road where all the HR operations took
place.The structure of HR department is not so large. In the HR Department there is a Regional
head. The Regional Head is at the Top position of HR department. He controls all the
Management of this department of Regional basis. Identify short-term and long-term hiring
needs, Set performance standards and evaluate local HR teams, Design employees’ compensation
and benefits packages, Define onboarding procedures in alignment with our company culture,
Help organize employer branding activities (e.g. host a recruitment event)/ Determine training
plans per employee and department, Prepare and manage division’s budget, Track recruitment
KPIs and suggest improvements, as needed, Design and implement company policies that comply
with our business objectives, Ensure all HR operations adhere to legal standards, Support staff
and managers on day-to-day issues, Coordinate with National HR Manager to craft organization-
wide strategies and objectives All the branches of a Region work under the Regional head. The
next position below the Regional Head is Branch manager. There are many branch managers
working under the Regional Head. They have assigned different branches about which they have
to done all the tasks. Directing all operational aspects including distribution, customer service,
human resources, administration and sales in accordance with the bank’s objectives, Providing
training, coaching, development and motivation for bank personnel, Developing forecasts,
financial objectives and business plans The next one is ROM (Regional operational managers).
The Regional Operations Manager is responsible for overseeing the daily operations of an audio
visual integration company including, but not limited to, technician scheduling, client
communication, project management, strategic planning, budgetary performance, inventory
management and staffing and recruiting. At the last there is HR officer. HR Officers are
responsible for a sound and effective human resource policy for the bank so that the human
resources available with the bank can be efficiently and effectively utilized.
Page 29 of 55
CRITICAL ANALYSIS
Although the Bank is performing their function very well but mostly the staff of the bank is
young. They have very less experience and low banking knowledge. The banking staff always
worries about for increasing the deposit of the bank rather than improving the bank services.The
branch is located in the competitive area that’s why customer’s output is moderate in this
branch. Every morning The Branchmanager gives the Branch report to the Regional manage on
the telephone Meeting. Which has no logic because The branch manager always worries for the
deposit. In MCB recruitment is done through Hierarchy
ON Regional basis
ON Area basis
ON Branch basis.
SOURCES OF RECRUITMENT:
In MCB Hr department is using both Recruitment methods internal and external.
For External recruitment they advertise online on websites, in newspapers.
For internal recruitment they take references from existing employees to save advertising
expense . Their strategies are very strong. They already have the list of new employes on a safe
side in case any employee is leaving the job.
SELECTION TOOLS:
The selection tools are used in MCB according to the designation. For higher posts like
relationship manager SME they prefer batch hiring and from now onward they are conducting
tests for batch hiring and then star interview The STAR method is a structured manner of
responding to a behavioral-based interview question by discussing the specific situation, task,
action, and result of the situation you are describing. Situation: Describe the situation that you
were in or the task that you needed to accomplish.. But if a sudden need of employee is faced in
the company they just do a panel interview and hire the employee. For the other two posts
phone banking officer and counter service officer they done unstructured individual interview.
ASSESSMENT CRITERIA:
For every post they rate the knowledge skills and abilities in different ratio to assess. They
follow KSAO to assess. KSAOs are the job-related Knowledges, Skills, Abilities, and Other
characteristics that an applicant must have to perform successfully in the
Page 30 of 55
position. KSAOs typically fall into two major categories – technical and behavioral. They rank
everything at different percentage. This information is collected by them through application
form. Then the selected candidates are called for interview. And after interview suitable
candidates are selected.
EVALUATION:
The evaluation is done on yearly basis .Supervisors evaluate the performance of
other employees. Performance based bonuses and promotions are given to the employees.
ISSUES IN HR DEPARTMENT:
The only issue the HR dep is facing in MCB is that the cases sometimes not delivered on time
by the other branches. Like an employee is required for a post but the branch has not informed
on time to the Hr dep or in Hiring the employees the Regional r branch managers have delayed
the case for some cause. These problems are faced rarely.
Ratio Analysis
Formula
Page 31 of 55
(Net profit after taxation / net sale) * 100
40
35
30
25
20 Net Profit Margin
15
10
5
0
1 2 3
Interpretation
Net profit margin has been decreased over the year but in year 2017 and 2018 we can say that it
is relatively stable in values.
Page 32 of 55
28,483,084 / 40,043,824 35,774,544/ 51,616,007 36,833,529/ 54,821,296
Working
2016
Net income margin = mark-up earned – mark-up expanses
= 40043824-11560740=28483084
(profit and loss account –unconsolidated)
2017
Net income margin = mark-up earned – mark-up expanses
= 51616007-15841463=35774544
profit and loss account –unconsolidated)
2018
Net income margin = mark-up earned – mark-up expanses
= 54821296-17987767=36833529
profit and loss account –unconsolidated)
0.71
0.7
0.69
0.67
0.66
0.65
1 2 3
Interpretation
Page 33 of 55
Year 2016 Year 2017 Year 2018
Working
2016
Total income=interest earned + non mark-up income
=40,043,824+30,255,403 =70299277
2017
Total income=interest earned + non mark-up income
=51,616,007 + 34,095,108 = 85711115
0.43
0.42
0.41
0.38
0.37
2008 2009 2010
Interpretation
Non interest income to total Income ratio is decrease in 2017 and then increase in 2018 as
compared to the previous years.
Page 34 of 55
4) Spread ratio
Formula
Interest earned / interest expenses
Spread Ratio
3.5
3.4
3.3
3.2
Spread Ratio
3.1
3
2.9
2.8
1 2 3
Interpretation
Spread ratio is decrease in 2017 as compare to 2016 and then increase in 2018 but there is little
difference in values.
Page 35 of 55
5) Return on Assets(ROA)
Formula
(Earning before income tax / total assets) * 100
Return on Assets
7.8
7.75
7.7
7.65
7.6 Return on Assets
7.55
7.5
7.45
7.4
1 2 3
Interpretation
Return on asset is increasing over the year and it is good sign for the organization.
Page 36 of 55
6) DuPont Return on Assets
Formula
(Net income / sale) * (sale / total assets) * 100
Working
2008
Net income =15,374,600 (profit and loss account -unconsolidated)
Sales = 40,043,824
Total assets = 443,615,904(balance sheet)
DuPont return on assets = (Net income / sale) * (sale / total assets) * 100
= (15,374,600/40,043,824 * 40,043,824 / 443,615,904) * 100
= (0.383944 * 0.090267) * 100
2009
Net income = 15,495,297 (profit and loss account –unconsolidated)
Sales = 51,616,007
Total assets = 509,223,727 (balance sheet)
2010
Net income = 16,873,175 (profit and loss account unconsolidated)
Sales = 54,821,296
Total assets = 567,552,163 (balance sheet unconsolidated)
Page 37 of 55
Graphical Presentation of DuPont Returns on Assets
3.5
3.4
3.3
3.2
3.1 DuPont Return on
Assets
3
2.9
2.8
2.7
1 2 3
Interpretation
DuPont return on assets has been decrease over the years. It is due to the increase in the net
income as compared to the sales times the increase in sales over the worth of assets.
Working
2016
Net income 15,374,600 ( profit and loss account -unconsolidated)
Total equity 52,244,865 (balance sheet unconsolidated)
Page 38 of 55
2017
Net income 15,495,297(2009 profit and loss account -unconsolidated)
Total equity 61,075,932(2009 balance sheet unconsolidated)
2018
Net income 16,873,175(profit and loss account -unconsolidated)
Total equity 69,180,011(balance sheet -unconsolidated)
30
25
20
10
0
1 2 3
Interpretation
Return on total equity is decrease over the year this in not worthy for the organization and it is
increase by profit by saving more and more taxes.
8) Debt Ratio
Formula
Total Liabilities / Total Assets
Working
2016
Total liabilities 385,179,850(balance sheet -unconsolidated)
Page 39 of 55
Total assets 443,615,904(balance sheet –unconsolidated)
2017
Total liabilities 439,483,714( balance sheet -unconsolidated)
Total assets 509,223,727( balance sheet –unconsolidated)
2018
Total liabilities 488,348,404(balance sheet -unconsolidated)
Total assets 567,552,613(balance sheet –unconsolidated)
Debt Ratio
0.87
0.868
0.866
0.864
0.862 Debt Ratio
0.86
0.858
0.856
0.854
1 2 3
Interpretation
Debit ratio has been decrease and relatively stable in 2017 and 2018.
Working
Page 40 of 55
2016
Total liabilities 385,179,850
Total shareholders equity 52,244,865 ( balance sheet –unconsolidated)
2017
Total liabilities 439,483,714
Total shareholders equity 61,075,932 ( balance sheet –unconsolidated)
2018
Total liabilities 488,348,404
Total shareholders equity 69,180,011( balance sheet –unconsolidated)
7.4
7.35
7.3
7.25
7.2
7.15 Debt to Equity Ratio
7.1
7.05
7
6.95
6.9
1 2 3
Interpretation
Page 41 of 55
Working
2016
EBIT = profit before tax + interest expenses
=21867566 + 11560740
=33428306
Interest expenses =11,560,740
( profit and loss account –unconsolidated)
2017
EBIT = profit before tax + interest expenses
=23,154,945 + 15,841,463
=38,996,408
Interest expenses =15,841,463
(profit and loss account -unconsolidated)
2018
2010- EBIT = profit before tax + interest expenses
=26,253,075 + 17,987,767
=44,240,842
Interest expense = 17,987,767
( profit and loss account –unconsolidated)
2.9
2.8
2.7
2.6
Times Interest Earned
2.5
2.4
2.3
Interpretation
2.2
1 2 3
Time interest has decrease first and then it is stable for the next 2017 and 2018 years.
Page 42 of 55
262,135,470/330,181,624 253,294,407/367,604,711 254,551,589/431,371,937
0.8
0.7
0.6
0.5
0.4 Advance to Deposit
Ratio
0.3
0.2
0.1
0
1 2 3
Interpretation
Advance to deposit ratio is decrease over the period and it is good sigh for the organization.
Working
2016
Current liabilities = bill payable + borrowing + deposit +other liabilities
Page 43 of 55
=10,551,468+22,663,840+330,181,624+21,345,781
=384742713 ( balance sheet–unconsolidated)
2017
Current liabilities = bill payable + borrowing + deposit +other liabilities
=8,201,090+44,662,088+367,604,711+15,819,082
=436286971 (balance sheet –unconsolidated)
2018
Current liabilities = bill payable + borrowing + deposit +other liabilities
=10265537+25684593+431371937+16092319
=483414386 (balance sheet –unconsolidated)
0.18
0.16
0.14
0.12
0.1 Operating Cash Flow
0.08 Ratio
0.06
0.04
0.02
0
1 2 3
Interpretation
Operating cash flow ratio first increase this is not worthy for the organization and in year 2018
it is decrease again which is good sign.
Page 44 of 55
Working
2016
Dividend paid = 9834175(cash flow –unconsolidated)
No. of outstanding shares = 6282768/10=628276.8
2017
Dividend paid = 6735510(cash flow –unconsolidated)
No. of outstanding shares = 6911045/10=691104.5
2018
Dividend paid = 8567574(cash flow –unconsolidated)
No. of outstanding shares = 7602150/10=760215
Graphical Presentation of Dividend per Share
16
14
12
10
8 Dividend per Share
6
4
2
0
1 2 3
Interpretation
Dividend per share of the company is fluctuation over the years. It depend upon the company’s
policy how much dividend it likes to share with its share holder.
14) Earning per share
Formula
Net income / number of outstanding
Working
Page 45 of 55
2016
Net income = 15374600
Number of shares outstanding = 6282786 / 10 = 628276.8
2017
Net income =15,495,297
Number of shares outstanding = 6911045 / 10 = 691104.5
2018
Net income = 16873175
Number of shares outstanding = 7602150 / 10 = 760215
24.5
24
23.5
23
Earning per Share
22.5
22
21.5
21
1 2 3
Interpretation
Earning per share has decreased over the years; it is need to be increasing it by increasing the
net income.
Working
Page 46 of 55
2016
Market value per share = 125.81
Net income = 15,374,600
No of out standing shares = 6282786 / 10
= 628276.8
Earning per share = 15,376,600 / 628276.8
= 24.471061
2017
Market value per share = 219.68
Net income = 15,495,297
No of out standing shares = 6911045 / 10
= 691104.5
Earning per share = 15,495,297 / 691104.5
= 22.421062
2018
Market value per share = 228.54
Net income = 16,873,175
No of out standing shares =7602150 / 10
=760215
Earning per share = 16,873,175 / 760215
= 22.195267
12
10
0
1 2 3
Interpretation
Price earning ratio of the company has been increase over the years. It is good sign for the
organization.
Page 47 of 55
CRITICAL ANALYSIS
Although the Bank is performing their function very well but mostly the staff of the bank is
young. They have very less experience and low banking knowledge. The banking staff always
worries about for increasing the deposit of the bank rather than improving the bank services.The
branch is located in the competitive area that’s why customer’s output is moderate in this
branch. Every morning The Branchmanager gives the Branch report to the Regional manage on
the telephone Meeting. Which has no logic because The branch manager always worries for the
deposit. In MCB recruitment is done through Hierarchy
ON Regional basis
ON Area basis
ON Branch basis.
SOURCES OF RECRUITMENT:
In MCB Hr department is using both Recruitment methods internal and external.
For External recruitment they advertise online on websites, in newspapers.
For internal recruitment they take references from existing employees to save advertising
expense . Their strategies are very strong. They already have the list of new employes on a safe
side in case any employee is leaving the job.
SELECTION TOOLS:
The selection tools are used in MCB according to the designation. For higher posts like
relationship manager SME they prefer batch hiring and from now onward they are conducting
tests for batch hiring and then star interview The STAR method is a structured manner of
responding to a behavioral-based interview question by discussing the specific situation, task,
action, and result of the situation you are describing. Situation: Describe the situation that you
were in or the task that you needed to accomplish.. But if a sudden need of employee is faced in
the company they just do a panel interview and hire the employee. For the other two posts
phone banking officer and counter service officer they done unstructured individual interview.
ASSESSMENT CRITERIA:
For every post they rate the knowledge skills and abilities in different ratio to assess. They
follow KSAO to assess. KSAOs are the job-related Knowledges, Skills, Abilities, and Other
characteristics that an applicant must have to perform successfully in the
Page 48 of 55
position. KSAOs typically fall into two major categories – technical and behavioral. They rank
everything at different percentage. This information is collected by them through application
form. Then the selected candidates are called for interview. And after interview suitable
candidates are selected.
EVALUATION:
The evaluation is done on yearly basis .Supervisors evaluate the performance of
other employees. Performance based bonuses and promotions are given to the employees.
ISSUES IN HR DEPARTMENT:
The only issue the HR dep is facing in MCB is that the cases sometimes not delivered on time
by the other branches. Like an employee is required for a post but the branch has not informed
on time to the Hr dep or in Hiring the employees the Regional r branch managers have delayed
the case for some cause. These problems are faced rarely.
SWOT ANALYSIS
Page 49 of 55
STRENGTHS
WEAKNESSES
Page 50 of 55
Decision making process is very slow.
It is not having greater no. of branches abroad.
Though ATM network is the largest in Pakistan, still some potential areas don’t have the
ATM.
MCB RTC is useable only in Pakistan.
Some management positrons needed are not professional.
Although most of the branches are computerized now, still some important branches don’t
have computers.
OPPORTUNITIES:
Leasing sector is growing in Pakistan for the last two to three years which provides
opportunity to MCB to go ahead in this area as well.
MCB is providing Consumer Finances at comparatively lower rates which paves a way to
grab more customers
Financing to small/medium cottage industries will definitely increase its advances and
profitability as well.
Islamic Trading Based Banking can enhance the business of the bank.
THREATS:
Other private commercial bank with sound profitability is also a threat to MCB e.g. UBL,
Alfalah, HBL etc.
For the last of many years, Pakistan is facing economic and political instability which is
a big threat.
Afghan war and Iraq war has a deep effect on the economy of Pakistan, which may affect
MCB.
Foreign banks are flourishing in field of consumer financing.
People don’t prefer banking culture. They mostly prefer cash transactions.
CONCLUSIONS
Page 51 of 55
ormally which we study the performance of Muslim Commercial Bank it is considered
N that on the whole bank is contributing a lot towards the industrial development and
capital formation in the country. As it is exhibited from the data regarding the banks
financial performance as shown in this report that the bank is sharing major banking
business of the country. Further the policies and schemes as are introduced and carried on by
the bank are of great source of help in industrial and trading growth. All these things reflect the
great and valuable efforts on the part of executive command of the bank which is finally
responsible for the productive performance of the bank. But as it is said that nothing is perfect
in this work. This might stand true in the case of Muslim Commercial Bank also.
So far as my own observations are concerned. I have concluded a major drawback in the inner
current banking system. In addition to the I have also learnt some disciplinary wrong practices
on the part of staff of the bank branches.
NO QUALITY IN ATTITUDE.
The attitude of the bankers with all of their customers is not the same, they pay more attention
and good service to some of the customers and neglect a major portion of them. Some of the
customers approach to the bank officials and get their work done before others; it is not a good
practice.
NO PROPER GUIDANCE
There are so many customers who don’t know how to fill cheques, pay-in-slip, application
form, etc. They waste a lot of time of the bank stall.
RECOMMANDATIONS
PROPER PLANNING
Page 52 of 55
Bank should make a plan to gear up its recovery efforts on war footing and reorganize the
recovery function of global bases. In addition, bank should tighten up control on
expenditure.
PROPER GUIDANCE.
Bank should adopt such an induction plan that when a customer opens his account with the bank
he should be supplied with a booklet which enables him to know the procedure of filing the
cheques, pay-in-slip etc. It will save a lot of time of the bank staff afterward during the conduct
of the account of that customer.
DIVISION OF WORK.
The billing system of MCB must be improved to facilitate the customers and workers. The work
should be divided among the staff e.g. collection of bills.
Countering of cash and then entry of these
CHECK OF EXPENDITURES.
www.mcb.com.pk
Page 53 of 55
www.google.com
www.sbp.com
http://www.mcb.com.pk/ir/fin_data_rep.asp
www.wikipedia.com
ANNEXES
From the MCB bank (Ltd) official website
http://www.mcb.com.pk/ir/fin_data_rep.asp
Page 54 of 55
Page 55 of 55