Intern ship report report final

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INTERNSHIP REPORT
ON
Program: M.Com (Accounts)
Session : 2012-2014
Submitted To:
Chairman
Department of Commerce
Submitted By:
Name: Ruquia Batool
Roll #:02
Email Address:Ruquia.shah2012@gmail.com
Mailing Address:House 28 Arif Colony BWP
Date of Submission:Sep 1,2014
DEPARTMENT OF COMMERCE

Internship Report on MCB Bank
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ACKNOWLEDGEMENT
Person is not a perfect in all the contexts of his life, He has a limited mind and mind thinking
approaches. It is the guidance from Almighty Allah that shows the man light in the darkness
and the person find his way in the light. Without this helping light, person is nothing but a
helpless creation.
The teaching of the Holy Prophet Muhammad (PBUH) were also the continuous source of
guidance for me especially his order of getting knowledge and fulfilling once duty honestly
was key motivation force for me.
With prayers of my parents and support of my teachers it became possible to formulate this
report. I pay high regards to them.
I like to thank Mr. Fawad and Miss Shakila as they helped me remarkably for this project.

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Contents
ACKNOWLEDGEMENT.......................................................................................................................II
CONTENTS .......................................................................................................................................III
CHAPTER # 1 ..................................................................................................................................... 1
REVIEW............................................................................................................................................. 1
1 OBJECTIVES............................................................................................................................ 2
2 OVERVIEW OF THE ORGANIZATION............................................................................... 3
BRIEF HISTORY OF THE ORGANIZATION......................................................................................... 3
AWARDS & ACHIEVEMENTS.................................................................................................... 8
VISION & MISSION .................................................................................................................... 10
VALUES OF MCB........................................................................................................................ 10
3 NATURE OF THE ORGANIZATION................................................................................... 12
BUSINESS ACTIVITIES.............................................................................................................. 12
BUSINESS VOLUME................................................................................................................... 14
YEARS TREND (2003 - 2013) ...................................................................................................... 14
ORGANIZATIONAL STRUCTURE........................................................................................... 19
CORPORATE INFORMATION.................................................................................................. 20
BRANCH NETWORK.................................................................................................................. 22
PRODUCT & SERVICES ............................................................................................................ 23
4 OVERVIEW OF DEPARTMENT.......................................................................................... 38
ORGANIZATIONAL STRUCTURE OF THE BRANCH.......................................................................... 38
EMPLOYEES DETAIL................................................................................................................ 39

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DEPARTMENTS OF MCB DUBAI CHOWK BRANCH (1164)................................................ 40
5 DORMANT ACCOUNT ACTIVATION PROJECT:............................................................ 44
CHAPTER NO-2................................................................................................................................ 49
ANALYSIS ........................................................................................................................................ 49
6 MACRO ANALYSIS OF COMMERCIAL BANKS INDUSTRY......................................... 50
PEST ANALYSIS........................................................................................................................... 50
POLITICAL...................................................................................................................................... 50
ECONOMIC ..................................................................................................................................... 50
SOCIAL AND CULTURAL................................................................................................................. 50
TECHNICAL .................................................................................................................................... 51
7 MICRO ENVIRONMENT ANALYSIS.................................................................................. 52
SWOT ANALYSIS........................................................................................................................... 52
PORTER FIVE FORCES MODEL....................................................................................................... 56
8 SHARE PRICE SENSITIVITY ANALYSIS.......................................................................... 58
9 ORGANIZATIONAL ANALYSIS ......................................................................................... 59
(COMPARISON WITH OTHER BANKS) .................................................................................. 59
10 MARKET SUMMARY AT 22-8-2014 OF ALL COMMERCIAL BANKS COMPETING
MCB............................................................................................................................................... 62
11 FUTURE PROSPECTS OF MCB......................................................................................... 74
12 FINANCIAL ANALYSIS...................................................................................................... 75
STATEMENT OF FINANCIAL POSITION............................................................................... 75
PROFIT AND LOSS ACCOUNT ......................................................................................................... 77
13 RATIO ANALYSIS............................................................................................................... 80
14 FIVE YEARS’ VERTICAL ANALYSIS .............................................................................. 93
BALANCE SHEET ....................................................................................................................... 93

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PROFIT AND LOSS ACCOUNT................................................................................................. 95
15 FIVE YEARS’ HORIZONTAL ANALYSIS........................................................................ 96
STATEMENT OF FINANCIAL POSITION............................................................................... 96
PROFIT & LOSS ACCOUNT...................................................................................................... 98
COMMENTARY ON HORIZONTAL AND VERTICAL ANALYSIS......................................................... 99
CHAPTER NO-3.............................................................................................................................. 101
FINDINGS, ..................................................................................................................................... 101
CONCLUSIONS AND RECOMMENDATIONS.................................................................................... 101
16 WEAKNESSES OF THE ORGANIZATION..................................................................... 102
17 SUMMARY.......................................................................................................................... 104
18 CONCLUSIONS.................................................................................................................. 105
19 RECOMMENDATIONS..................................................................................................... 106
20 GLOSSARY......................................................................................................................... 108
21 ANNEXURE............................................................................................................................ 110

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Supervisor Detail:
Name: Mr Shoaib
Desigination: Branch Manager
Qualification: MA
Office Email address: MCB1164@MCB.com.pk
Name: Fawad ul hasnain
Desigination: NPL Officer
Qualification: M.Com
Office Email address: fawad.hasnain@MCB.com.pk
Contact No: 03336361514

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MCB Dubai Chowk Branch (Regional
Branch) Branch Code-1164

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1 Objectives
This internship offers me an incredible opportunity to gain real-world experience in the high-
stakes finance industry. The primary objective of the project is to forecast or determine the
actual financial status and performance of an organization.
Following are other objectives of studying the organization:
 To learn about Capital Adequacy, Asset and Liability Management, Interest Rate
Risk, Liquidity, Asset Quality & Profitability of bank.
 To monitor the adequacy and effectiveness of the internal control system and
Financial Reporting Framework.
 Assessment of the company’s financial condition through the financial statements.
 Analyzing savings and investment trends in banking sector.
 To describe the impact of financial decisions on the health and functioning of the
overall organization.
 To examine the Innovations in customer service in banking.
Internship is the capstone experience that provides me with hands-on, real-world
experience in a work setting. Ideally, internship will enable internees to:
 Use my knowledge and skills get from the classroom,
 Discover where further competence is needed,
 Convert the bookish knowledge into practical life, and
 become better acquainted with the types of work settings in which such
Competence can be applied.
Limitation of the Study:
The study is done with the sole purpose of doing the best work but there were
certain limitation faced during the internship period. The most important limitation
from which the study suffers is the non-availability of information in a manner
required for analysis and the secrecy of the bank. Another important limitation of the
study is time and space constraint. Main limitation which I faced is that I only worked on
project for which I have selected by HRMG of MCB Bank Dormant Account Activation

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Project and on general banking and I have no experience about other department like, credit,
remittance, advances, receipts, payments and forex.
2 Overview of the Organization
Brief History of the Organization
The history of MCB can be divided into four main Phases:
• Development Phase
• Nationalization Phase
• Privatization Phase
• Present Position of MCB
Development Phase
MCB Bank Limited was incorporated by the Adam jee 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 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

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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.
Privatization 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 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. Banks (Nationalization) (Second
Amendment) Ordinance 1991 was also promulgated to pave the way for privatization of
banks in Pakistan.
In the wake of above amendments, 26% shares valuing Rs. 149.8 millions 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.
 Present position of MCB
MCB has significant contributions in building & strengthening both corporate and retail
banking sector in Pakistan. MCB Bank Ltd in 2009 delivered a profit before tax of Rs. 23.2
Billion registering a growth of 6% over last year. This growth is directly attributable to an
increase of 14% in CASA deposits, 21% in revenues and a tight control on expense base
enabling to retain position as one of the most profitable banks in the country.
In 2009, MCB delivered a superior return on equity of 27.4% and assets crossed the Rs. 500
Billion mark. This performance is all the more remarkable keeping in view the economic &

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political challenges faced by the country during this past year and miscreant created issues
that MCB specifically grappled with for a large part of the year. MCB fundamental belief is
that a financial services company can only succeed if it meets its customers’ needs. If they
can understand customer’s financial objectives and offer them the right products and services
so that they can be financially successful, then MCB Bank will continue to build on its
leadership position and provide requisite returns to its shareholders. During 2009, MCB took
several initiatives that brought even closer to their customers. With the launch of MCB
Privilege, MCB became the first local bank to offer a dedicated proposition for the affluent
segment; to meet the growth and protection needs of customers, Bank introduced
Bancassurance and Investment Products in many branches; to enhance transactional
convenience for customers, MCB became the first Pakistani bank to launch mobile banking.
These coupled with several other initiatives enabled MCB to continue on the path of growing
customer base and profitability. Last year, to expand and reach customer proposition, MCB
also reached an agreement with RBS Pakistan to acquire their business. Unfortunately, the
deal did not go through but bank continue to invest organically to further strengthen
businesses.
The Board of Directors of MCB Bank Limited met under the Chairmanship of Mian
Mohammad Mansha, on April 22, 2014 to review performance of the Bank and approve
financial statements for the quarter ended March 31, 2014.From financial performance
perspective, the operational profitability of the Bank depicted an improvement as net interest
margin increased by 3% over March 2013. This was achieved despite the fact that the Bank
offered higher rates on its savings and term deposits, based on regulatory revisions on
minimum deposit rate. MCB Bank focused on improving its non-markup income proportion
and registered a growth of 17% over corresponding period of last year. The administrative
expense base (excluding pension fund reversal) recorded an increase of approximately 12%.
A substantial reversal of Rs. 583 million in the provision charge is reflective of the prudent
and aggressive provision strategy adopted by the Bank and rigorous efforts put in by the
recovery units. All this translated into profit before tax at Rs. 8.35 billion and profit after tax
at Rs. 5.51 billion. MCB Bank’s total asset base was reported at an all-time high of Rs.
827.25 billion which increased by 1% over December 31, 2013. Net investments increased
by Rs. 13.14 billion to Rs. 462.15 billion, whereas gross advances were reported at Rs.
272.46 billion. Following the trajectory set in 2012 and 2013, the non-performing loan base
of the Bank reported a significant contraction of Rs. 753 million in the quarter ended March
31, 2014 with major recoveries in loss categorized loans. On the liabilities side, the Bank

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continued with its strategy of shifting its base to low cost current and savings accounts, taking
the CASA base to an all-time high of 91% approximately. Earnings per share (EPS) for the
period came to Rs. 4.95, whereas return on assets was reported at 2.68%. Return on equity
came to 22.44% with book value per share improving to Rs. 89.15 as compared to 87.39 for
December 31, 2013.The Board of Directors of MCB Bank declared a cash dividend of Rs.
3.00 per share for the period ended March 31, 2014.
Corporate Profile of the Bank
MCB is one of the oldest banks of Pakistan, incorporated in 1947. It was privatized in 1991.
To accede to international capital markets, the Bank launched Global Depositary Receipts
(GDRs) in 2006. It was the first Pakistani Bank that got its GDRs listed on the London Stock
Exchange. In 2008, the Bank entered into a strategic partnership with Maybank, Malaysia,
which owns 20% stake in it through Mayban International Trust (Labuan) Berhad.
Subsidiaries
MCB Financial Services Limited
Holding: 99.999%
Profile: Float, administer and manage modaraba funds, modarabas and also acts as trustees of
various mutual funds.
MNET Services (Private) Limited
Holding: 99.95%
Profile: One of the largest service providers for Electronic Transactions to various financial
institutions/banks including related services in Information Technology, software and data
processing.
MCB Trade Services Limited
Holding: 100%
Profile: Provides agency services.
Arif Habib Investments Limited
Holding: 51.33%
Profile: Asset management, investment advisory, portfolio management, equity research and
underwriting.
“MCB Leasing” Closed Joint Stock Company, Azerbaijan

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Holding: 95.00%
Profile: It leases various types of industrial equipment, public transports, real estate and retail
auto leases.
With reference to significant holding, the following entities are associates of the Bank
Adamjee Insurance Company Limited
Holding: 29.13%
Euronet Pakistan (Private) Limited
Holding: 30%
First Women Bank Limited
Holding: 15.46%

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Awards & Achievements
2013 The Asset Triple A: Best Domestic Bank - Pakistan
2013 The Asset Triple A: Best Islamic Deal
2013 ICAP and ICMAP: 1st - BCR Award 2012 - Banking Sector
2013 LK Domain Registry Sri Lanka: Best Website Award
2013 Lanka Clear Pvt. Limited: T+1 Cheque Clearing Award
2012 The Asset Triple A: Best Domestic Bank - Pakistan
2012 Euromoney: Best Bank in Pakistan
2012 NFEH: CSR Business Excellence Award “Best Media Coverage”
2012 ICAP and ICMAP: 2nd Best Corporate Report Award
2011 - Banking Sector 2012 World Finance: Best Commercial Bank - Pakistan
2012 Pakistan Centre for Philanthropy: PCP Corporate Philanthropy Award
2011 CFA Association Pakistan: Most Stable Bank of the Year
2011 CFA Association Pakistan: Best Bank of the Year
2011 ICAP / ICMAP: 1st - BCR Award 2010 - Banking Sector
2011 SAFA: Joint 2nd Runner-up for BCR 2010
2010 The Asian Banker: Strongest Bank in Pakistan
2010 The Asian Banker: Leadership Achievement Award
2010 MMT: Best Bank Led MMT Service
2010 ICAP / ICMAP: 1st - BCR Award 2009 - Banking Sector
2010 SAFA: Certiﬁcate of Merit Award for BCR 2009
2009 Asiamoney: Best Domestic Bank in Pakistan
2009 The Asset: Best Domestic Bank in Pakistan
2008 Euromoney: Best Bank in Asia

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Vision & Mission
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.
Values of MCB
Integrity
We are the trustees of public funds and serve our community with integrity. We believe in
being the best at always doing the right thing. We deliver on our responsibilities and
commitments to our customers as well as our colleagues.
Respect
We respect our customer’s values, beliefs, culture and history. We value the equality of
gender and diversity of experience and education that our employees bring with them. We
create an environment where each individual is enabled to succeed.
Excellence
We take personal responsibility for our role as leaders in the pursuit of excellence. We are a
performance driven, result oriented organization where merit is the only criterion for reward.
Customer Centricity
Our customers are at the heart of everything we do. We thrive on the challenge of
understanding their needs and aspirations, both realized and unrealized. We make every effort
to exceed customer expectations through superior services and solutions.
Innovation

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We encourage and reward people who challenge the status quo and think beyond the
boundaries of the conventional. Our teams work together for the smooth and efficient
implementation of ideas and initiatives.

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3 Nature of the organization
MCB Bank Limited 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 it’s Global Depository Receipts (GDRs) representing
two ordinary shares are traded on the International Order Book (IOB) system of the London
Stock Exchange.
Business Activities
MCB Bank Limited is a Pakistan-based company. The Bank operates in four business
segments:
 Corporate finance
 Trading and sales
 Retail and consumer banking
 Commercial banking
 Corporate Finance
Corporate finance includes underwriting, securitization, investment banking, syndications;
initial public offerings (IPO) related activities (excluding investments) and secondary private
placements.
 Trading & Sales
Trading & sales segment includes fixed income, equity, foreign exchange commodities,
lending’s to financial institutions and brokerage debt.
 Retail & Consumer Banking
Retail & consumer banking includes retail lending and deposits, banking services, private
lending and deposits, banking services and retail offered to its retail customers and small and
medium enterprises.
 Commercial Banking
Commercial banking segment includes project finance, export finance, trade finance,
leasing, lending, guarantees and bills of exchange relating to its corporate customers.
Islamic Banking

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MCB-Islamic Banking Group (IBG) provides Shariah-compliant solutions to its valued
customers to fulfill their deposits as well as financing needs. Customers’ needs on deposit
side are being satisfied keeping in view of their business, short term and long term investment
requirements; whereas on financing side, the Working Capital, Capital Expenditures, Trade
Business and Consumer requirements are being satisfied through available sharia compliant
financing products. In addition to existing IB products, IBG believe in facilitating it’s
customer by offering new products both on assets and liability side. This year, IBG has
introduced a new asset based product for satisfying exporter’s pre-shipment financing needs
by offering “Istisna Pre-shipment Export Finance”. And for its valued depositors, a special
term deposit scheme with attractive profit rates for senior citizens and widows under the
name of “Aasoodgi” was also introduced. MCB-Islamic Banking is offering its product
through its 27 dedicated Islamic Banking branches in 14 cities across the country. In order to
facilitate its customer and to increase outreach of Islamic banking deposit products, an
initiative was taken by introducing Islamic which is expected to further enhance in future.
.

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Business Volume
Years Trend (2003 - 2013)
Total Assets
The asset base of the Bank has almost doubled over the last 6 years growing from Rs. 443
billion as at December 31, 2008 to Rs. 815 billion at the end of financial year 2013,
translating into an annual growth of 12% for the last six years; Prime contributors to the said
increase have been advances and investments over years, which increased contributions from
investments in the recent years. MCB Bank has been prudently able to manage the risks and
returns of its earning asset base to deliver maximum return to its stakeholders.

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Investments
The lacks of credit opportunities have paved way for build-up in investment base over the
years. The investment base of the Bank has increased extravagantly from Rs. 96 billion in
2008 to Rs. 449 billion in 2013 with major concentration levels in risk free Market Treasury
bills and Pakistan Investment Bonds.

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Deposits
The deposit base of the Bank has steadily grown over the last six years, with absolute
numbers increasing from Rs. 330B in 2008 to Rs. 632B in 2013. MCB Bank’s competitive
edge has been the highest CASA base, supporting its lower cost of deposits. The Bank has
been constantly shifting its high cost deposit to low cost deposits, as CASA base has more
than doubled in last 6 years, increasing from Rs. 268 billion in 2008 to Rs. 568 billion in
2013; MCB Bank has been able to maintain its share in the domestic industry deposit pie with
an average share of approximately 8%. As depicted by the deposit categorization, the quality
of service and returns provided by the Bank has enabled to keep the CASA base above 80%
for the last six years.

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Advances
The macro-economic instability coupled with energy crisis has adversely affected the private
sector credit demand of the local banking industry and a similar pattern can be observed for
MCB Bank Limited. Being mainstream business line of the Bank, credit growth remained
prime focus of the Bank but the lack of credit opportunities and intense competition resulted
in a moderate growth in gross advances base. However, based on significant additions
recorded in investment base, the ADR had been decreased as a result of shift in asset mix
from 83% reported in 2008 to 42% reported for 2013.

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Non-Markup Income
• To coupe up with the interest rate volatility, the bank has strategically focused on the
increased contribution from non-markup based income. The product development teams of
the Bank have been tapping the unbanked segment of the population and offering them
tailored products to meet their specific financial requirements. Numbers of products have
been launched in past 6 years in order to increase non-markup income like credit card, mobile
banking, visa debit card, MCB Lite, prepaid cards etc.
• The fee, commission and brokerage block of the Bank has been constantly increasing over
years with major contributions coming from commission earned on bancassurance business,
remittances and intercity / intra-city cash transfers.
• The equity investment base of the Bank has been providing outstanding dividend yields
with dividend income registering the second highest contribution to non-markup income.
During the year 2013, substantial capital gains were earned, benefitting from the record levels
posted by the equity markets.

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Organizational Structure

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Corporate Information
Board of Directors
Mian Mohammad Mansha (Non-Executive
Director)
(Chairman)
S. M. Muneer (Non-Executive Director)
(Vice Chairman)
Tariq Rafi (Non-Executive
Director)
Shahzad Saleem (Non-Executive
Director)
Sarmad Amin (Non-Executive
Director)
Mian Raza Mansha (Non-Executive Director)
Aftab Ahmad Khan (Non-Executive
Director)
Mian Umer Mansha (Non-Executive Director)
Ahmad Alman Aslam (Non-Executive Director)
Dato’ Seri Ismail (Non-Executive
Director)
Shahudin
Muhammad Ali Zeb (Non-Executive
Director)
Imran Maqbool (Executive Director)
(President and CEO)
Audit Committee
Tariq Rafi (Non-Executive
Director)
Chairman
Aftab Ahmad Khan (Non-Executive
Director)
Chief Financial Officer
Salman Zafar Siddiqi
Company Secretary
Syed Mudassar Hussain Naqvi
Auditors
M/s. A. F. Ferguson & Co.
Chartered Accountants
Legal Advisors
M/s. Khalid Anwer & Co.
Advocates & Legal Consultants
Registrar’s and Share Registration
Office
 Head Office
M/s. THK Associates (Pvt.) Ltd.
State Life Building No.3
Dr. Ziauddin Ahmed Road Karachi,
Pakistan.
 Branch Office
M/s. THK Associates (Pvt.) Ltd.
2nd Floor, DYL Motorcycles Ltd.
Office Building
Plot No. 346, Block No. G-III,
Khokhar Chowk
Main Boulevard, Johar Town,
Lahore, Pakistan.

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Dato’ Seri Ismail Shahudin (Non-Executive
Director)
Ahmad Alman Aslam (Non-Executive
Director)
Principal/Registered Office
MCB Building, 15-Main Gulberg
Jail Road, Lahore, Pakistan.
Contact us:
UAN: +92 42 111 000 622
Email: investor.relations@MCB.com.pk
Visit us: www.MCB.com.pk

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Branch Network
Branch Network
Domestic Operation-
1194
Overseas Operations-
08
Sri Lanka-06 EPZ-01
Bahrain-01 UAE-01
(Rep. Office)
Branches-1180 Retail-1133
Privilege-10
WBG-10
Islamic-27
Retail Sub Branches-
14

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Product & Services
1.5
PRODUCT & SERVICES
MCB CORPORATE FINANCING
VIRTUAL BANKING
ISLAMIC BANKING
AGRI PRODUCTS
MCB INVESTMENT BANKING
MCB RETAIL BANKING
OTHER SERVICES
PRIVILAGED BANKING

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Product & Services
MCB Corporate Financing
MCB Corporate Financing provides access to diversified financing options, including
working capital loans, term loans, trade finance services and investment banking.
 Working Capital Loans
Based on the customer’s specific needs, the Corporate Bank offers a number of different
working capital financing facilities including Running Finance, Cash Finance, Export
Refinance, Pre shipment and Post- shipment etc. Tailor- made solutions are developed
keeping in view the unique requirements of your business.
 Term Loans
MCB offers Short to Medium Term Finance to meet capital expenditure and short term
working capital requirements of our customers. The loans are structured on the basis of
underlying project characteristics and cash flows of the business.
 Trade Finance Services
Under Corporate Banking MCB offers trade finance services that include an entire range of
import and export activities including issuing Letters of Credit (L/Cs), purchasing export
documents, providing guarantees and other support services.
 Cash Management
Cash Management provides a wide range of value added services to large corporations
through its vast network of online branches. Our structured and customized products enable
our customers to realize their sales proceeds swiftly from all over the country, supported by
real-time MIS.
 Transaction Banking Division
Transaction Banking provides wide range of value added services to large corporations
through its vast network of real-time online branches network. Our structured and customized
products enable our customers to realize their sales proceeds swiftly from all over the
country, supported by real-time MIS.
The basic products offered by Transaction Banking Division are as under:
a. Collections
b. Payments
c. Channel Financing
d. Local Rupee Drawing Arrangement

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e. Home Remittances
MCB Retail Banking
1. Deposit Accounts
2. MCB Bancassurance
3. MCB’s Remittance
4. MCB Loan Products
5. MCB Rupee Travelers Cheque
6. MCB Online Services
7. MCB Cards
1. Deposit Accounts
 Current Account
MCB Bank offers a variety of current accounts to cater to the everyday transactional needs of
various customers. These accounts ensure ease and freedom to bank from any of the 1,100
branches across the country. The different accounts include: the basic account that has no
minimum balance; Business Account offering free online transactions, Demand Drafts, Pay
Orders and lots more to meet the day to day business requirements; Current Life Account
which offers the security of life insurance free of cost; and for all the others the conventional
Current Account.
 Savings Account
It offers a wide array of savings products that suit short term growth & transactional needs.
Our savings accounts offer attractive profit rates as well as flexibility to transact. Savings
Xtra is targeted for customers having Rs. 5 million deposit, 365 Gold offers profit rate on
daily balance while PLS savings has a lower minimum balance requirement. In addition, a
unique product: Smart Savings is an account run solely via a debit cart, offering a very
competitive rate to small savers.
 Foreign Currency Account
Enjoy the confidence of operating an international account, locally. MCB Foreign Currency
Account offers the option of earning attractive returns on your Foreign Currency Investment.
 Saving 365 Gold
MCB Savings 365 Gold Account offers you a wide range of attractive profit rates. The MCB

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Saving 365 calculates profits on a daily product basis and gives you the facility of unlimited
withdrawals.
 Smart Dollar Account
MCB Smart Dollar Account is a sensible way to maintain or grow your US Dollar deposit
across USD Current, Savings or Term Deposits.
 Special Term Deposits
With a wide range of choices and tenors, you can open one or more term deposit accounts
that best suit your current or long term needs MCB Term Deposits offer attractive short to
mid-term investment options with flexibility, convenience and security. With various tenor
options available customers can choose one that suits their needs. This is combined with
different profit payout options and the added facility of being able to avail credit facility
against their deposits.
 Business Accounts
MCB Business Account lets you build your business through the accrued savings from
discounted transaction fees, and more.
 Saving Xtra Account
MCB Savings Xtra Account offers you a wide range of attractive profit rates. Grow with
MCB Xtra by saving more and earning greater profit.
 Current Life Account
The coverage you need for the life you lead. MCB Current Life gives you the peace of mind
of comprehensive life insurance in a current account and fits right into your lifestyle
 Mahana Khushali Bachat
MCB Monthly Khushali Scheme provides you with a steady income every month. Just
purchase a Monthly Khushali Certificate and you will enjoy a steady income of your total
deposit every month. Terms deposit.
2. MCB Bancassurance
Combining the best of banking and insurance solutions, MCB Bancassurance has created a
one-stop shop for all your financial and insurance needs. Whether you want to save for your
child’s education or marriage, for the security of dignity after retirement or gaining maximum
return on savings, MCB Bancassurance has a plan just for you.
 Flexi Life
 Life Partner

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 Edu Care
 Dream Wedding
 Capital Sure
 Retire Easy
 Income Max
 Future Assure
 Protection Plan
3. MCB’s Remittance
Fast, secure and easy-to-use, MCB's Remittance Services is an efficient way to transfer
money overseas. You can remit funds from any country to Pakistan through Swift System.
MCB Home Remittance provides a seamless inflow of foreign remittances credited in the
beneficiary’s account within minutes. Cash payments can also be made at our designated
branches on behalf of Xpress money, Samba (Speed cash now) and MoneyGram, along with
cash payments from other correspondents all over the world.
4. MCB Loan Products
 Car4U
MCB Car4U not only gets a car of your own choice but is also affordable with competitive
mark-up, flexible conditions, easy processing and above all, no hidden costs.
 Business Sarmaya
Good cash flow is the key to any successful business. MCB Business Sarmaya offers running
finance facility against your house/ flat, insuring a steady cash flow for your business.
 Pyara Ghar
MCB Pyara Ghar is an ideal Home Finance from your own bank that lets you Purchase,
Renovate or Construct your home the way you have always wanted. Having your own home
was never so easy
 Easy Personal Loan
MCB Easy Personal Loan provides you with the financial advantage to do things you've
always wanted to but never had the sufficient funds for. Take that much-needed holiday. Buy
a car. Refurnish your house. Purchase a new TV. Finance a better education for your
children.
 Instant Finance

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With MCB instant Finance get a loan instantly at any MCB branch against liquid collateral at
competitive pricing.

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5. MCB Rupee Travelers Cheque
It is a safe and secure way to make payments nationwide. MCB Rupee Travelers Cheque,
being the market leader, is the most widely accepted way to pay cash for travel-related
purposes MCB Rupee Traveler's Cheques were first introduced in 1993 as safe cash for
traveling and travel related purposes.
6. MCB Online Services
 ATMs
MCB has one of the nation's largest ATM networks with over 450 ATMs and still growing.
MCB ATMs give you 24-hours convenience of cash withdrawal, mini-statement, utility bill
payment, funds transfer services and much more. With MCB Mobile ATM not only do we
provide you with world class banking service but we also provide convenience. Our
innovative mobile ATMs ensure that you are given service close to you.
 Call Center
The state of the art MCB call center is the right choice to keep you in step with your ever
hectic schedule by providing you services relating to your account and Smart card at any
point in time.
There’s no easier way to bank than the new enhanced 24/7 MCB Call Center, which blends
innovation and convenience to provide Banking Services that go beyond expectations. With
MCB Call Centre you can maintain your VISA credit & ATM/Debit cards, check your
account balances, confirm last 5 transactions, pay utility & mobile phone bills, top-up your
mobile, pay MCB Visa Credit Card bill from your MCB account, transfer money within your
own accounts in MCB and register complaint.
 Mobile Banking
At the forefront of technological excellence, MCB proudly introduces MCB MOBILE
BANKING. MCB Mobile is a quick easy and secure way to recharge mobile phones, transfer
money, pay bills and do much more. No need to visit a branch or an ATM anymore, login to
www.MCBmobile.com using your mobile phone and start transacting.
 Bill Payments
MCB easy bill pay offers unmatched convenience to pay your utility and mobile phone bills
or re-charge your prepaid mobile phone accounts anywhere, anytime with security and peace
of mind. MCB is the only bank that offers you 3 convenient options of making bill payments

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to PTCL, SSGC, SNGPL, KESC, Mobilink, Supernet, IESCO, HESCO, and Ufone. So, save
your precious time by avoiding long queues and pay your bills through MCB Easy Bill Pay.
 Online Banking
MCB has a fast growing network of over 1,100 online branches in the country providing
customers real time online transaction facilities.
7. MCB Cards
 Smart Card
MCB Smart Card is the key that enables access to convenient banking services. Smart Card
allows you to manage your account, withdraw cash, transfer funds, pay utility and mobile
bills, recharge prepaid connections, and register for mobile and internet banking services and
much more. The convenience and flexibility of MCB Smartcard will help you live a smarter
life. It not only helps you manage your expenses, but also eliminates undue interest on your
day to day credit card transactions. Your balance is always within your reach and you spend
accordingly.
MCB now brings MCB SmartCard a secure and convenient instrument of payment with
unmatched functionalities. It provides 24-hour direct access to your bank account.
 Debit Card
Now MCB brings a secure, convenient and quick payment facility that enables you to do
purchasing by using your existing MCB ATM / MCB Smart Card as a DEBIT CARD.
 Visa Credit Card
MCB offers a complete suite of Classic, Gold and Platinum Visa Credit Cards focusing on
providing, superior service, travel privileges & shopping pleasure. It also offers
comprehensive insurance & installment plans, reward points and SMS alerts that give a
different feel to the world of Credit Cards. These unique features include i-revolve, which
makes variable mark-up rate available to customers allowing them to repay at affordable
rates.

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MCB Investment Banking
Make the most of customer’s wealth with investment opportunities that match their unique
financial aspirations. MCB Investment Services offer distribution of mutual funds managed
by the leading fund managers of Pakistan. We can suggest the products most suited for their
needs, or work with them to create a personalized solution completely focused on their
expectations of the capital markets.
MCB goal is to provide best financial solutions to client helping them achieving their
objectives and support economic growth of the Country. The basic services offered by
investment banking are as under:
 Project & Structured Finance
Involves financing complex projects, usually in an SPV structure, where the loan is tightly
structured around the cash flows, risks are allocated amongst various stakeholders, and there
is limited or no recourse to the sponsors.
 Syndicated Loans and Debt Capital Markets
It involves structuring/advisory arrangement, underwriting and placement services for
significant financing requirements by large corporate and institutional clients to other
financial institutions or through the debt capital markets.
 Quasi Equity/Hybrid Instruments
It structures and places a category of debt that has some characteristics of equity such as
being unsecured, subordinated or with a potential equity upside.
 Equity Capital Raising
Equity Services relate to raising capital for clients by offering common or preferred equity to
public or private investors, through initial public offers, offers for sale, rights issues and
private equity placements.
 Advisory Services
Financial and Capital Raising Advisory provides clients with financial advisory services,
commercial structuring support and access to capital resources to help companies
successfully finance their business/project.

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 Facility Administration
Management of creditor interests in syndicated transactions in capacities such as facility
agent, security trustee, project monitoring bank, book-runner etc.
 Commercial Banking
Complementary products and services such as revolving lines of credit, trade services and
cash management that may be bundled with our Investment Banking Products.
MCB Agriculture Products
MCB has been providing finance to the agriculture sector since 1973. With the help of our
vast branch network, specialized staff posted in the branches, multiple and diversified product
range, we cater to the financing requirements of the farming community spread throughout
the country and facilitate in achieving increased productivity.
 Shadabi Plan
Shadabi Plan caters the financing needs for production activities on the farm which mainly
include seed, pesticides and fertilizers along with provisions for miscellaneous expenses like
payment of electricity & diesel bills of tube wells, maintenance expenses for tractors and the
like items as per list of Eligible items.
 Khushali Scheme
Under Khushali Scheme loans/finances are allowed for farm/ non-farm credits which include
fixed investments/working capital requirements. Amount of finances sanctioned depend upon
the credit requirement and collateral.
Financing for land leveling/development, heavy equipment’s, agriculture machinery,
vehicles/transport for agri purpose are covered under this scheme. There may be other
development projects proposed by the farmers falling with in the ambit of agri financing,
which can be considered under this scheme.
 Tractor Finance Scheme
To boost up the mechanized farming in the country, Tractor Finance Scheme is introduced to
offer specialized services to farmers. Under this scheme, there is no requirement of minimum
land holding because of multipurpose use of tractor for agriculture cum commercial.
However, the repayment capacity and potential use of tractor will be evaluated at the time of
loan processing.

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 Aabiari Scheme
Under the Aabiari scheme, financing facilities for tube well, other wells, irrigation systems of
all types including sprinklers are covered. The purpose is to facilitate the farmers in
overcoming the shortage of water for cultivation/plantation since water is essential
requirement for crops.
 Grower Finance
Grower Finance is a unique way of financing registered/ (bonafide) growers/farmers of
sugarcane, cotton and rice (mills). The special characteristic is that the financing facilities are
extended to farmers against the Mill/Factory guarantee. Fixed/floating charge may be created
on the Mill's assets and the loan is disbursed directly to the growers. This finance is short
term in nature but the tenure may extend to eighteen months in case of growers of sugarcane.
 Dairy & Meat Plan
The plan is aimed at promoting the Dairy sector & meat production in the country. The
farmers are extended financing facilities to purchase dairy animals for milk and for the
establishment of animal fattening stations to increase meat production on commercial line,
thus enabling the farmer to create more income.
 Murghbani Scheme
Murghbani Scheme covers extensively all requirements of the poultry industry with focus on
facilitating the farmers. We offer financing facilities of all types of activities in the value
chain starting from establishment of poultry farms infrastructure to all requirements in the
process till the final out put including marketing of the same by the farmers. Value addition
process by the farmers for poultry processing is also covered under the scheme.
 Baghbani
The scheme aims at facilitating the farmers engaged in horticulture by extending credit
facilities covering the entire range of related activities. The proposals are assessed keeping in
view the market potential and repayment capacity based on the cash flows of the activity.
The farmers are extended all type of credit facilities required to produce fruits & vegetables
of better quality. The repayment of the loan is as per farmer convenience or linked to crop
cycle and timings of cash flows. Facilities like running finance, working capital requirements,
infrastructure development, machinery & equipment, irrigation etc. are all covered under this
scheme. Progressive farmers are especially encouraged.

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 Mahigeri Scheme
Mahigeri Scheme caters to the credit needs of fish farmers covering entire range of activities
including marketing of their produce. The loans are of short, medium and long term
depending upon the purpose. Financing for value addition process by the fish farmers is also
covered under the scheme.
Virtual Banking
MCB provides the convenience of banking via internet, whether at home, office or on travel,
log on to www.MCB.com.pk and enjoy 24 hour access to all your accounts at MCB for great
number of services such as Funds Transfer, Utility Bill Payments, Mobile Top-ups and much
more.
 Detailed Account Summary of all listed accounts.
 Mini-statements of each of the listed accounts showing recent transaction history for
that account(s).
 Statement-by-Period of each of the listed accounts, based on the period specified.
 Immediate or Scheduled Transfer of Funds between your own accounts, as well as to
third-party accounts setup as beneficiaries, maintaining accounts with MCB.
 Scheduling of ‘One-Time’ as well as ‘Recurring’ Funds Transfers.
 Payment of utility bills for registered Utility Companies.
 Immediate or Scheduled Bills Payment. Scheduling of ‘One-Time’ as well as
‘Recurring’ bill payments. Option for ‘Full’ or ‘Partial’ payment based on the
payment conditions specified by a particular Utility Company.
 Bulk Salary Transfer for Corporate Customers, to facilitate them in paying salary to
the corporate employees, who maintain accounts with MCB.
 Bulk Funds Transfer for Corporate Customers.
 Cheque Book Request for any of your listed accounts.
 Payment/Transfer Alerts for reminding, in advance, prior to the processing of
specified payments and transfers.
 Personal Alerts for reminding of pre-specified events and occasions.

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Islamic Banking
With the help of Shariah specialists, lawyers and professional commercial bankers, MCB
Islamic Banking provides Riba Free and Shariah Compliant solutions to various customer
segments in a growing number of cities.
1. Deposit Schemes
For customers who are looking for a deposit opportunity where they can purse their funds and
reap halal returns on it, MCB offer the following products:
I. Al-Makhraj Saving Account
II. Al-Makhraj Ianat Account
III. Al-Makhraj Term Deposit
2. Fund Based Facilities
MCB offers 3 broad Islamic fund based facilities:
 Ijarah
 Murabahah
 Diminishing Musharika Equipment
 Ijarah Products
MCB’s Islamic Ijarah, analogous to the English term 'leasing’, is based on the ‘Ijarah wa
Iqtina’ concept which means the sale of the asset to the lessee after the Ijarah has matured.
Under this scheme, MCB will be the owner of the asset, and the customer (lessee) will be
given the asset to use for a certain period of time in return for monthly rental payments.
MCB will give a separate unilateral undertaking that it will offer to sell the asset to the
customer (lessee) at the maturity of the Ijarah agreement at a price that may be equal to the
security deposit amount, hence the term ‘Wa Iqtina’
Types of Ijarah
I. Car Ijarah
II. Equipment Ijarah
 Murabahah
It is a contract between a buyer and a seller under which the later first purchases the goods at
the request of the former i.e., customer and then sells it to same customer after adding profit.
Murabah Sale Price = Cost + Expenses incurred + Agreed Profit

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 Musharika Equipment
It is a contract through which the bank and its client participate in the joint ownership of a
property. The share of the Bank is further divided into a number of units and it is agreed that
the client will purchase the bank’s share periodically, thus increasing his own share until all
the units of the bank are purchased by him so as to make the client the sole owner of the
property.
Privilege Banking
A first from a local bank, MCB Privilege through its dedicated, world class Privilege Centers
offers a higher level of personalized services, more rewarding in-branch experiences and a
wide array of deposit and investment products that are tailored to meet the financial
expectations for affluent clientele. As members of MCB Privilege, customers experience
unparalleled advantages that put them ahead of others. MCB’s dedicated Privilege Centers a
wait to welcome you in Karachi, Lahore, Islamabad and Multan, with plans to expand to
more locations.
Other Services
 MCB MNET
MNET is an electronic inter-bank connectivity platform for online transactions on ATM and
other remote banking channels. It offers other Value Added Services that include a portfolio
of e-banking and payment system products as well as management and day-to-day operations
of the same. Members include 10 local and foreign financial institutions enjoying ATM
sharing and Value Added Services.
 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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 MCB Lockers
MCB Lockers are the best protection for your valuables. Lockers of different capacities are
available nationwide.
 MCB SMS Banking
Banking at your fingertips SMS anytime to get information regarding balance, mini
statements and credit card related information once your card is linked.
 MCB Full Day Banking
Enjoy the convenience of extended banking hours from 9am to 5pm, including Saturdays at
MCB branches across the country.

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4 Overview of Department
Organizational Structure of the Branch
A well-developed and properly coordinate structure is an important requirement for the
success of any organization. It provides the basic framework within which functions and
procedures are performed. Any organization needs a structure, which provides a framework
for successful operations. The operation of an organization involves a number of activities,
which are related to decision making, and communication of these decisions. These activities
must be well coordinated so that the goals of the organization are achieved successfully
Regional Head
Commercial
Branch Manager
Branch Operation
Manager
Senior Personal Banking
Advisor
Forex Manager Customer Service Officer Credit Manager/
Relationship Manager
Teller Service Supervisor General Service Officer General Banking Officer-
-Remittance
-Clearing
-GL Accounts
-Shares
-Atm
Forex Officer
Teller Service Officer

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Employees Detail
Serial No. Employee Name Department
1 Shoaib Khan BM
2 Shabir Hussain Bajwa BOM
3 M Ijaz Balouch TSO
4 Syed Shahid GBO
5 M. Asif Iftikhar Credit Manager
6 Syed Ali Mohtisham Naqvi Credit Officer
7 Ali Raza Credit Officer
8 Shahzad Ali Khan Trade Officer
9 Ghulam Ghous TSO
10 Uzair Masood TSO

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Departments of MCB Dubai Chowk Branch (1164)
The departments are as under
 General Banking Department
I. Clearing Department
II. Remittance Department
 Accounts Department
 Credit Department
 Foreign Trade
 Internal Control Department
 Clearing Department
Clearing means collection of cheques receive from our customers but drawn on other banks.
Receiving the instruments deposited by customers posting the amount of instruments in credit
of customer’s account If cheque returns from the concerned bank, the customer account is
debited. Crossing stamp is put on the instrument and slip given to customer on receipt of the
instrument. Clearing stamp and “payee account credited” are put on the instrument and the
voucher. Clearing House has provided this facility. Clearing house facilitates different banks,
in one city, to get their cheques drawn upon other banks to be cleared.
Cheques lodged in clearing constitute in clearing constitute two types of clearing:
 Outward Clearing
 Inward Clearing
 Outward Clearing
When cheques, TC’s and other negotiable instruments drawn upon other banks like NBP,
ABN AMRO of the same city (as Bahawalpur) are presented in Muslim Commercial bank to
deposit them in the respective payee’s accounts, these instruments are lodged in outward
clearing (o/w clg) of MCB bank.
Procedure of Outward Clearing
 The name of the branch appears on its face where it is drawn.
 It should not stale or post - dated or without date.
 Amount in words and figures does not differ.
 Signature of the drawer appears on the face of the instrument.

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 Instrument is not mutilated.
 There should be no material alteration, if so, it should be properly authenticated.
 If order instrument suitably indorsed and the last endorsee’s account being credited.
 Endorsement is in accordance with the crossing if any.
 The amount of the instrument is same as mentioned on the paying-in-slip and
counterfoil.
 The title of the account on the paying-in-slip is that of payee or endorsee (with the
exception of bearer cheque).
 If an instrument received other than MCB of Pakistan then special crossing stamp is
affixed across the face of the instrument. Clearing stamp is affixed on the face of the
instruments, paying-in-slip and counterfoil (The stamp is affixed in such a manner
that half appears on counterfoil and paying-in-slip). The instrument is suitably
discharged, where a bearer cheque does not require any discharge and also an
instrument in favor a bank not need be discharged.
 Over writing.
 No stamp of clearing or if it is not clear.
 No stamp of crossing or if it is not clear.
 Inward Clearing
Inward clearing means cheques drawn on Bank and presented by other banks. In inward
clearing Branch acts as paying banker. After realization of inward clearing, banks deposits
are decreased as bank makes payment to other banks from the balances held by the branch.
This realization of inward clearing is also referred to as responding to the clearing. Cheques
and other negotiable instruments (PO, DD, PS, CDR etc.) drawn on Muslim bank, sent by
other banks, constitute the inward clearing of MCB.
Procedure of Inward Clearing
 Instruments with schedules are received from NIFT.
 Amount of each instrument entered is in inward clearing register.
 Instruments are detached and handed over to the deposits and other respective
department for checking and payment.
 In case of any instrument is returned, return memo is prepared stating the reason of
the return.
 Entry is made in cheques Return register.
 Cheques return charges are recovered from the party as per charges schedule.
 Checking / Return of Instruments

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 Over writing
 No stamp of clearing or if it is not clear
 No stamp of crossing or if it is not clear
 Remittance Department
The Remittance department deals with the transfer of money from one place to another.
Funds transfer facility or remittance of funds is one of the key functions of the banks all over
the world. Remittances through banking channels save time, costs less and eliminate the risks
involved in physical transportation of money from one place to another. Muslim Commercial
Bank of Pakistan transfers money in the following ways.
 Pay Order
 Demand Draft
 Mail Transfer
 Telegraphic Transfer
 Pay Slip
 Call Deposit Receipt
 Letter of Credit
 Travelers Cheque
 Accounts Department
Opening of account is the most important department of the Branch as this is a contract
between the customer and bank. All future transaction/operation are carried out as per this
contract and any deviation may jeopardize the bank’s interest. The opening of a new account
is the establishment of customer banker relationship. By opening an account at a bank, a
person becomes a customer of the bank. The customers can open following accounts:
 Current Account (CD A/C)
 Profit and loss sharing Account (PLS A/C)
 Basic Bank Account (BBA A/C)
 Fixed Deposit (FDR/TDR)
Account Opening

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When a client comes to the bank, and makes a request for opening of an A/C. The officer
says that first fill up a prescribed application form. If he/she wants to open a PLS A/C, then
he/she has to fill a form according to the account.
Requirements
 ID Card of applicant
 ID Card of father, mother, brother, sister, husband or wife
 Student card (if applicant is student)
 Two photos for illiterate person or those who use Urdu signatures
Documents Attach with A/C Opening Form
 A/c opening form
 Specimen signature card
 Zakat form (for non-muslims)
 Deposit slip
 Requisition form
Issuance of Cheque Book
After opening an A/C with the bank, the A/C holder once again makes a request in the name
of bank for the issuance of a cheque book. The A/C holder mentions title of A/C, A/C
number, sign it properly and mentions the no of leaves he requires
 Credit Department
The bank is profit seeking institution. It attracts surplus balance from the customer at low rate
of interest and makes advances at a higher rate of interest to the individuals and business
firms. Credit extensions are the most important activity of all the financial institutions,
because it is the main source of earnings. Advances department is one of the most sensitive
and important department of the bank. The major portion of the profit is usually earned
through this department. The job of this department is to make proposals about the loans; the
credit management division of head office directly controls all the advances. The advances
Department receive application from intending borrowers. After receiving application the
advance department processes it further. After analyzing and detailed investigation, they
decide whether to approve the loan or not. Some loan approvals are made by the Manager of
the branch within his powers as prescribed by the bank’s higher authorities, while some loan
applications are submit to higher authorities for their approval.

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Some advances are of the following nature
 Loan against Gold
 Agriculture advance to farmers
 Medium term advance for working capital
 Long term advance for setting industry
 Short term advance to businessman
 Foreign Exchange Department
This department mainly deals with the foreign business. The main functions of this
departments are:
 L/C dealing.
 Foreign currency accounts dealing.
 Foreign Remittance dealing.
 Internal Control Department
Role of branch compliance department is to reconcile the prescribed frequencies, investigate
long pending reconciliation item, and ensure correct treatment every half-year and clearing
system service branch-in major cities. Internal control is the integration of the activities,
plans, attitudes, policies and efforts of the people of the bank working together to provide
reasonable assurance that the organization will achieve its objectives and mission.
5 Dormant account Activation project:
Dormant / Inoperative Accounts & Financial Instruments

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Checking accounts are classified accounts due to the conditions mentions mentioned in the
table below. The account become dormant if there is no activity in the account (excluding
system generated activity e. g. profit disbursement) shall be classified and flagged by the
system as “dormant account”. (No financial entry is passed). However half yearly profit shall
continue to be applied as usual on Savings account only.
Type of Account Dormancy Inoperative Unclaimed
Current Account 6 Months 2 Years 10 Years
Saving Account 1 Year 3 Years 10Years
Financial
Instruments
-
3 Year from Date of
Issuance
Unclaimed Deposits- Saving & Current Account
Current & Savings Account not operated four tan years from the date of last activity in the
account (excluding system generated activity e. g. profit disbursement) will be classified and
flagged by the system as un-claimed and on financial entry is passed).
Note: As per SBP BPRD circular 02 of jan 05, 2010 banks are NOT allowed to deduct
‘Service Charges’ on customer accounts which are classified as Dormant, In-operative & un-
claimed. And it is further notified that bank statement for such accounts will also not be
dispatched after the change of status from active to dormant
Activation & Operation in Dormant, Inoperative & Unclaimed Deposit
Accounts
Prime responsibility to approve operation and activation of a Dormant, inoperative and
Unclaimed (not yet surrendered to SBP) Accounts as well as payment of a claim lies with
PARENT BRANCH ONLY.
1. Any request for operation in above accounts should be initiated in-person by the
account holder in writing and must be supported by attested copy of valid CNIC (If
customer CNIC do not exist in the system, that it is required to verify it’s genuineness
through NDRA’s online VeriSys and retain the same as the record and update
customer’s record with CNIC number on the system. Request received from person
other that the account holder himself should not be entertained.

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2. Request received by the parent branch for execution of any customer initiated
transaction (financial or non-financial) will invariably be referred to the branch
manager who will scrutinize the request personally and satisfy himself beyond doubts
as to the genuineness thereof.
3. After being the satisfied, the branch manager operations manager will jointly approve
the operation in dormant, inoperative and unclaimed accounts OR will pay to a
rightful claimant means of payment order only as the case maybe.
4. In case of any particular does not match with NADRA records with the CNIC
provided by the customer, account should not be activated till completion information
is not updated on NADRA VeriSys.
5. In case where customer is reported as having dual CNIC’s as per NADRA VeriSys,
only valid CNIC should be obtained at the time of activation of Dormant Account and
this account should be marked as High Risk and should be monitored at regular
intervals. Further branches must ensure that he duplicate CNIC has been surrendered.
6. Where customer is holding dual CNIC as per NADRA VeriSys, and the account was
opened against surrendered CNIC, branch should immediately close the account after
completing all the formalities / requirements in light of instructions provided in CDD
/AML handbook.
In Case of Cross Branch Transaction
If customer approaches a Branch other than the ‘parent’ branch for operation in dorment,
inoperative and Unclaimed accounts the concerned branchbefore execution of customer
initiated transaction (financial or non-financial), is required to obtain written approval
from the parent branch, for this purpose:
1. Concerned branch will forward customer’s written request to the Branch Manager of
parent branch via fax or e-mail with scanned copy of customer request.
2. Branch Manager of parent branch will verify customer signature on customer’s
request, affix signature verification stamp and scrutinize the request personally and
satisfy himself beyond doubts as to the genuineness thereof. Also check the account
for complete documentation and KYC / AML requirements.

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3. After being so satisfied, request will be jointly approved by the Branch manager and
Branch Operation Manager of the parent branch mentioning their IBS number and
will forward the customer request back to the concerned branch through fax or e-mail.
4. This will be done only where the customer visits the paying branch in person.
5. Parent branch should retain a copy of the duly approved customer request as an
evidence and record in its dormant account activation file.
6. To ensure better customer service staff as both the branches should ensure that
process is completed in shortest possible time.
7. Account status will not be changed to ‘normal’ until customer personally performs a
financial transaction (deposit or withdrawal) in his account on the counter.
8. Branches will print the “Change in Account Status Report- KM0099” on daily basis
and file it chronologically as a branch record and for onward review by ROM.
In case of Inward Remittance in Dormant Account
 When the Remitter and beneficiary is the same person
If remittance is received in an account which is dormant, but the remittance has been sent
by the beneficiary himself, the bank will make the account operative and accept the
remittance provided the account is normal otherwise i.e., the account was opened without
any discrepancies and a valid CNIC is available for the account. In case the account has
discrepancies, BM/BOM will ensure to complete all formalities to regularize the account.
 When the Remitter and Beneficiary are different persons
If remittance is received in an account which is dormant and the remittance receives has
not been sent by the beneficiary himself, the Branch Manager/ Branch Operations
Manager should make full efforts to contact the customer and complete all formalities to
regularize the account. After being satisfied with the purpose of the remittance and
obtaining all relevant information/ documents to regularize the account, Account will be
activated and the remittance will be accepted.
Preservation of Documents
Branches are required to preserve all signature cards and document indicating the
“Signing Authorities” given to them and other documents relating to the debt or

48
instrument in the dual custody of Operations Manager and Designated Authorized Officer
until informed by SBP in writing that they need not be preserved the same any longer.

49
Chapter No-2
Analysis

50
6 Macro Analysis of Commercial Banks Industry
Pest Analysis
Political
 Employment practices are expected to change.
 Unions, Associations are being allowed to work effectively which can affect the
performance of the company both positively or negatively.
 Political interference regarding policies is expected to increase as current government is
in race of power gain.
 Due to lack of confidence on government, investor is reluctant so mobilization of funds is
going to decrease.
Economic
 Inflation is very high which will decrease the demand as purchasing power is decreasing.
 Staff cost is increasing as basic wage rate has increased and inflation has compelled to
will compel to increase salaries.
 Operating costs are increasing due to inflation.
 Interest rate is increasing so loan taking has decreased.
 Value of rupee is decreasing which is pressurizing the economy.
Social and Cultural
 Lack of experts is in our country regarding management hence innovative activities are
slow and conventional methods are adopted.
 Cultural strain to savings is the reason due to which investment remains low.
 Declining work ethics is also our problem which is mainly due to poverty, lack of
training.
 Inadequate Accountability, lack of good governance and lack of good infrastructure helps
creditor to cheat and heavy bad debts occur. Same situation is hoped to prevail.
 Inadequate Empowerment is also a usual problem in our organization as every person
want to get more power hence there is less delegation of authority and decision making.

51
 Due to the fast paced life style of modern day individual, modern facilities has been
provided by banks to customer.
 MCB commercial banking is also effected by religion because many people considered
banking HARAM due to interest.
Technical
 MCB has computerized its most of the branches but still some are manual there is need to
computerized otherwise customers will get bad image.
 Now a day computerized system is used by banks which is very effective. But MCB will
have to improve its computerized technology as some fake transactions occur by ATM.
 Employees of each organization need IT training and organization has this trend. MCB
will have to follow it.
 Commercial bank industry is using new technology of communication like banners and
customer relationship management (CRM). MCB has to improve its way of
communication.

52
7 Micro Environment Analysis
SWOT Analysis
Strengths  Strong capital base & Highest Capital
Adequacy Ratio in peer Banks.
 Highest CASA ratio / low cost deposits
(90%) in the industry.
 Ability to introduce new products to
improve margin and volumes.
 Diversified Portfolio of loans and
advances and diversified income streams.
 2nd lowest infection ratio in peer banks
 Conservative and sustainable business
policy.
 MCB is Successive and Market oriented.
 MCB investing huge sums on HR
development and training.
 Customer default rate is lower as
compared to other banks.
 MCB has the largest ATM network in the
country.

53
 Limited credit opportunities having low
risk profiles.
 Concentration in Govt securities &
Lending to Public/ Govt owned entities.
 Lesser international / Global presence as
compare to peer banks.
 Dependence on the money and capital
markets.
 Linkage of minimum deposits rate with
discount rate by regulator squeezing
banks margin.
 Exposure to the Euro/US dollar exchange
rate, with an impact on growth and
results.
 Low motivational level.
 Employees, dissatisfaction due to ill
treatment and improper reward system.
 Favoritism and Nepotism in recruitment.
 High Employees Turnover.
 Decision making process is very slow.
 It is not having greater no. of branches
abroad.
Weaknesses
Opportunities
 Potential for capitalization on the
anticipated growth in Islamic industry.
 Strong capital base enable the Bank to
explore international markets.
 GSP plus status helping to raise the credit

54
demand and recovery of classified
portfolio in textile sector.
 Positive and macroeconomic stability will
increase demand.
 Significant increase in the customer base,
further extension of the range of the
products.
 Expansion in Africa, Europe and Middle
East- Growth and expansion
opportunities in emerging economies.
 Expanding the advisory and other
services offered to clients and investors.
 Potential relationship with non-resident
Pakistanis to attract FDI and home
remittance.
 Population demographics show an
increase in working age population and
hence increase in banking needs.
 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.
 Islamic Trading Based Banking can
enhance the business of the bank.
 Overseas Operations.
 Competition from peer banks.
 Competition from growing branchless
banking.
Threats

55
 Delinquencies of credit portfolio due to
ailing economic conditions.
 Squeezing margin of Banking industry
due to minimum threshold for deposits
rates and reducing discount rate.
 For the last of many years, Pakistan is
facing economic and political instability
which is a big threat.
 Slowdown in the world economy
 Prevalent energy crises adversely
affecting projects viabilities and demand
for credits.

56
Porter Five forces Model
Potential Entrants
The banking sector of any country has always potential of growth and competition. Mostly
foreign banks step in the developing countries for expanding their branches, not only this
mergers between foreign and local banks take place at large scale but Pakistan's present
economic condition and government instability has arose the feelings of awe and terror
among most of the foreign banks to enter in the market. In future due to uncertainty and
security problems in Pakistan investors will not be willing to invest here. Due to overall
financial problems in the whole world new banks will not be entering in to the banking
industry
Bargaining Power of Customers
Bargaining power of buyer is low where the products substitutes are not available and
customers are large in number. In case of banks there are lots of other banks and banking
intermediaries, having wide range of products, so power of buyer in banking sector is high.
The bank cannot force any customer to buy the desired product because this directly affects
its reputation. However, the bank can convince its customers by giving them special discount
or rewards. If we look at MCB we will find that the competitors are also offering products
due to which customer feel in power by saying that they can go to some other bank in case of
dissatisfaction.
Threat of Substitutes:
Substitution of one product with another one increases the competition within an industry.
However, the perfect substitutes of banks are not available in the market at present, but
people still have choices of saving or investing their money. The people can save their money
in their own houses or they can deposit their money in the National Saving Centers (Banking
Intermediaries) which give protection to their assets. Aside from saving one can invest money
in stock market in form of shares / bonds or in real estate. These kinds of substitutes increase
the competition in the banking sector.

57
Bargaining Power of Suppliers
The lending power of bank is enhanced by its depositors as they are suppliers of the bank. It
allows bank to involve in other business activities to invest such as personal and business
loans. The suppliers then get interest on their amount as profit earned by the bank. Banks
need to concentrate on their policies as bargaining power of suppliers is very high and they
move towards highest interest rates
Rivalry among Current Competitors
There is tough competition between different banks. There is a huge variety of public and
private banks already exist in the market, offering products on competitive prices. If we look
at banking products (loans, savings and current accounts) then Alfalah Bank, Meezan Bank,
Habib Bank and many others are offering wide range of products in this sector. The tough
competition between these banks increases the challenge which the MCB have to face. The
competition among various banks increases the switching of the customers form one bank's
product to the other bank.
According to Porters Five Forces analysis we can say that MCB has no fear of new entrants
due to the poor economic position of Pakistan. However, it should keep its eyes open
regarding mergers of various banks. There are two big threats; firstly from the buyers who
can go to the other banks and secondly form the substitutes like investment in stock market,
so MCB should carefully examine its task environment.

58
8 Share Price Sensitivity Analysis
Factors that can influence the share price of MCB Bank Limited are given below:
 Discount rate / Monetary Policy:
Based on different assessment parameters, the State Bank of Pakistan can change the
monetary policy rate. Any decrease in discount rate will result in lower net interest income
and reduce profitability of the Bank. As a result, its share price may drop.
 Minimum Rate of Return on Deposits
Any upward revision in the minimum deposit rate will result in compression in net interest
margins earned due to increased cost of deposits. Such revision can negatively impact the
earning and correspondingly the share price of the scrip.
 Inflation
Inflation is considered as a key determinant for policy rate change. Any uptick in the inflation
statistics will have a corresponding impact on the monetary policy rate. With higher discount
rates, the Banks will be able to invest in high yielding investments, thus resulting in increased
profitability. This, in turn will have a positive impact on the share price.
 Political Stability & Law and order situation
Political stability and controlled law & order situation is a pre-requisite for any economic
development. This in turn reposes investor confidence in the soils of Pakistan, making our
corporates a potential investment opportunity. However, any act of terrorism or political
instability can negatively impact the equity market and share prices of traded stocks.

59
9 ORGANIZATIONALANALYSIS
(COMPARISON WITH OTHER BANKS)
MCB Comparison with United Bank Limited & National Bank of Pakistan and Habib Bank
Limited
(Thousand Rupees)
Particulars HBL UBL MCB NBP
Deposits and other accounts 1,401,229,814 889,525,603 632,309,094 1,101,845,283
Investments 826,062,308 458,846,198 453,808,345 396,411,825
Profit after taxation 23,027,095 19,730,771 21,950,141 5,306,783
Total liabilities 1,572,837,124 972,359,569 705,815,509 1,211,054,416
MCB has less deposits then all oter banks.

60
MCB Bank has less investment then HBL and UBL but more than NBP.
Profit after taxation has less than HBL but more than others.

61
Total liabilities are less as compared to all other Banks. This shows good trend.

62
10 Market Summary at 22-8-2014 of All Commercial Banks
Competing MCB
Commercial Banks
SYMBOL LDCP OPEN HIGH LOW CURRENT CHANGE VOLUME
Allied Bank 112.75 112 113 111.7 112.13 -0.62 700
Askari Bank 19.84 20 20.2 19.85 19.92 0.08 434,500
B.O.Punjab 8.04 8.06 8.14 7.95 8.04 0 5,307,500
Bank Al-Falah 27.48 27.5 27.99 27.5 27.81 0.33 216,500
Bank AL-
Habib
46.28 46.5 46.9 46.25 46.25 -0.03 2,500
Bank Of
Khyber
8.45 8.01 8.01 8.01 8.01 -0.44 4,000
Bank islami
Pakistan
9.5 9.5 9.5 9.5 9.5 0 7,500
Faysal Bank 16 16.02 16.02 15.7 15.79 -0.21 1,080,500
Habib Bank
Ltd
186.87 186.75 187.17 186 186.02 -0.85 871,400
Habib
Metropol
30.3 30 30.75 29.75 30.24 -0.06 53,500
JS Bank Ltd 4.89 4.8 4.9 4.8 4.89 0 344,500
KASB Bank
Ltd.
1.48 1.43 1.5 1.43 1.47 -0.01 113,500
MCB Bank
Ltd
290.1 289.95 292.99 289 289.67 -0.43 47,000
Meezan Bank 40.26 40.3 40.5 40.3 40.5 0.24 5,500

63
National
Bank.
58.31 58.5 58.8 57.75 57.99 -0.32 1,117,500
NIB Bank
Limited
2.01 1.98 2.03 1.9 2 -0.01 293,500
Samba Bank 6.2 6 6.3 6 6.25 0.05 241,000
SilkBank
Limited
1.96 2 2.04 1.88 1.95 -0.01 569,500
Soneri Bank
Ltd
12.8 12.71 12.71 12.5 12.52 -0.28 22,500
St.Chart.Bank 23.9 23.3 25 23.26 24.74 0.84 30,000
Summit Bank 2.9 2.91 3 2.9 2.99 0.09 194,000
United Bank 179.92 180.2 181.99 178.11 179.13 -0.79 387,400
Graphical Representation
As compared to MCB bank Allied Bank has less closing price and less number of share and
both bank has negative change -0.62 and -0.43 respectively.

64
As compared to MCB bank Askari Bank has less closing price but more number of share of
Askari Bank are traded in market .MCB bank has negative change -0.43 and Askari Bank
has 0.08 positive change in LDCP and Current price. .
As compared to MCB bank B.O. Bank has less closing price but more number of share of
Askari Bank are traded in market .MCB bank has negative change -0.43 and Askari Bank
has no change in LDCP and Current price..

65
As compared to MCB bank Bank Al-Falah has less closing price but more number of share of
Bank Al-Falah are traded in market .MCB bank has negative change -0.43 and Bank Al-Falah
has no change in LDCP and Current price.
As compared to MCB bank Bank Al-Habib has less closing price but more number of share
of Bank Al-Habib are traded in market .MCB bank has negative change -0.43 and Bank Al-
Falah has also negative change of -0.03 in LDCP and Current price.

66
As compared to MCB bank Bank of Khyber has less closing price and less number of share
of Bank Al-Habib are traded in market .MCB bank has negative change -0.43 and Bank Al-
Falah has also negative change of -0.44 in LDCP and Current price.
As compared to MCB bank Bank Islami Pakistan has less closing price and less number of
share of Bank Islami Pakistan are traded in market .MCB bank has negative change -0.43 and
Bank Islami Pakistan has has no change in LDCP and Current price..

67
As compared to MCB bank Faysal Bank has less closing price and less number of share of
Faysal Bank are traded in market .MCB bank has negative change -0.43 and Faysal Bank has
also negative change of -0.21 in LDCP and Current price.
As compared to MCB bank United Bank has less closing price but more number of share of
Faysal Bank are traded in market .MCB bank has negative change -0.43 and Faysal Bank has

68
As compared to MCB bank Summit Bank has less closing price but more number of share of
Summit Bank are traded in market .MCB bank has negative change -0.43 and Summit Bank
has also positive change of 0.09 in LDCP and Current price.
As compared to MCB bank St.Chart Bank has less closing price and less number of share of
St.Chart Bank are traded in market .MCB bank has negative change -0.43 and St.Chart Bank
has also positive change of 0.84 in LDCP and Current price.

69
As compared to MCB bank Soneri Bank has less closing price and less number of share of
Soneri Bank are traded in market .MCB bank has negative change -0.43 and Soneri Bank has
As compared to MCB bank Meezan Bank has less closing price and less number of share of
Meezan Bank are traded in market .MCB bank has negative change -0.43 and Meezan Bank
has positive change of 0.24 in LDCP and Current price.

70
As compared to MCB bank KASB Bank has less closing price and more number of share of
KASB Bank are traded in market .MCB bank has negative change -0.43 and KASB Bank has
As compared to MCB bank JS Bank has less closing price and more number of share of JS
Bank are traded in market .MCB bank has negative change -0.43 and JS Bank has no change
of in LDCP and Current price

71
As compared to MCB bank Habib Metropol Bank has less closing price and more number of
share of Habib Metropol Bank are traded in market .MCB bank has negative change -0.43
and Habib Metropol Bank has also negative change of -0.06 in LDCP and Current price.
As compared to MCB bank Habib Bank has less closing price and more number of share of
Habib Bank are traded in market .MCB bank has negative change -0.43 and Habib Bank has

72
As compared to MCB bank Silk Bank has less closing price and more number of share of
Silk Bank are traded in market .MCB bank has negative change -0.43 and Silk Bank has also
negative change of -0.01 in LDCP and Current price.
As compared to MCB bank Samba Bank has less closing price and more number of share of
Samba Bank are traded in market .MCB bank has negative change -0.43 and Samba Bank has
positive change of 0.05 in LDCP and Current price.

73
As compared to MCB bank NIB Bank has less closing price and more number of share of
NIB Bank are traded in market .MCB bank has negative change -0.43 and NIB Bank also has
negative change of -0.01 in LDCP and Current price.
As compared to MCB bank National Bank has less closing price and more number of share of
National Bank are traded in market .MCB bank has negative change -0.43 and National Bank
also has negative change of -0.32 in LDCP and Current price.

74
11 Future Prospects of MCB
MCB team committed to taking the Bank to the next levels of success. Key features of
multipronged plan are as follows:
1. MCB wants to be viewed as the leader in transactional convenience. To get top market
share, they will continue to invest in alternate channel payment capabilities and services
as well as getting a larger share of transaction driven businesses like remittances, cash
management, payroll and trade.
2. Managements want to continue to invest in branches to make them more sales and service
oriented. Through introduction of new sales and service model, strengthened transaction
processing and leading financial products menu, aspire to achieve this ambition.
3. Management core focus on mass, mid-market and corporate segments, continue down the
path of further segmenting customer needs and developing focused customer
propositions, particularly in Privilege, Islamic & SME.
4. Not any organization can deliver without investing in its employees. In order to achieve
growth targets, management have to further strengthen reserve of talent and leadership
powered by a strong performance culture and training.
5. Finally, for an organization, controls and efficiency is central to existence. Management’s
strategy to build stronger controls, develop a unit cost culture.
MCB’s strengths in terms of its franchise, balance sheet and reputation are unparalleled.
Entire team task is to ensure that continue to go from strength to strength. Bank’s
performance in 2013 is an attestation of the commitment & passion that the team brings to
MCB and the strong support of the shareholders.

75
12 Financial Analysis
Statement of Financial Position
Statement of Financial Position
As at December 31, 2013(2009-2013)
(In millions)
2013 2012 2011 2010 2009
Assets
Cash and
balances with
treasury banks
59,946,150 57,420,211 53,122,620 45,407,264 38,774,871
Balances with
other banks
1,536,946 1,236,736 2,357,418 1,551,518 6,009,993
Lending to
financial
Institutions
1,224,638 1,551,472 955,087 4,401,781 3,000,000
Investments-
net
449,006,019 405,601,313 319,005,983 215,747,844 167,134,465
Advances-net 248,242,965 239,788,511 227,573,618 254,565,471 253,249,407
Operating
Fixed assets
28,595,338 24,144,242 22,418,450 21,061,787 18,014,896
Deferred tax
asset
- - - - -
Other assets 26,956,315 41,715,761 31,440,700 27,746,198 23,040,095
Total current
assets
815,508,371 771,458,246 656,873,876 570,481,863 509,223,727
Liabilities and

76
stockholders'
equity
Bills payable 10,138,726 9,896,284 9,466,818 10,265,537 8,201,090
Borrowings 38,542,660 79,064,351 39,100,627 25,684,593 44,662,088
Deposits and
other accounts
632,330,286 544,988,091 491,146,798 431,295,499 367,604,711
Sub-ordinated
loans
- - _ - -
Liabilities
against assets
subject to
finance lease
- - - - -
Deferred tax
liabilities
4,201,373 9,768,871 6,689,736 5,146,733 3,196,743
Other liabilities 20,064,345 21,265,639 18,457,835 16,090,374 15,819,082
Total
Liabilities
705277390 664983236 564861814 488482736 439483714
NET ASSETS 110,230,981 102,470,689 88,802,482 79,204,209 69,740,013
Represented
By:
Share capital 10,118,461 9,198,601 8,362,365 7,602,150 6,911,045
Reserves 46,601,214 44,620,928 42,412,588 40,164,526 38,385,760
Unappropriated
profit
40,552,043 37,530,955 88,802,482 23,458,429 15,779,127
97,271,718 88,876,792 78,915,003 69,180,011 61,075,932
Surplus on
revaluation of
assets net of
tax
12,959,263 13,593,897 9,887,479 10,771,324 8,664,081
110,230,981 102,470,689 88,802,482 79,204,209 69,740,013

77
Profit and Loss Account
Profit and Loss Account
For the year ended December 31, 2013 (2009-2013)
(In millions)
Year Ended June 30, 2013 2012 2011 2010 2009
Mark-up / return /
interest earned 65,064,123 68,356,191 68,215,902 54,829,365 51,616,007
Mark-up / return /
interest expensed 27,195,894 27,500,019 23,632,615 18,027,372 15,841,463
37,868,229 40,856,172 44,583,287 36,801,993 35,774,544
Provision for diminution
in value of investments -
net -6,834 -3,044 778,526 444,476 1,484,218
Provisions against loans
& Advances -net -2,828,783 480,903 2,846,523 3,100,594 5,796,527
Bad debts written off
directly - 206 28,565 52,047 41,576
Provisions against loans
& advances -net -2,835,617 478,065 3,653,614 3,597,117 7,322,321
Net mark-up / interest
income after
provisions 40,703,846 40,378,107 40,929,673 33,204,876 28,452,223
Non Mark – up / Interest
income
Fee, Commission and
Brokerage Income 6,741,404 5,934,472 4,921,269 33,204,876 3,331,856
Income earned as trustee
to various funds - - 17,257 22,714

78
Dividend Income 932,717 1,197,615 785,549 450,492 459,741
Income from dealing in
foreign Currencies 916,572 822,856 924,236 632,819 341,402
Gain on sale of
securities - net 2,130,341 824,539 761,890 410,618 773,768
Unrealized gain on
revaluation of
investments
classified as held for
trading - - 16,616 40,832 -
Other income 449,604 373,849 814,443 751,058 736,118
Total non- mark-up /
return / interest
income 11,170,638 9,153,331 8,241,260 6,441,642 5,642,885
51,874,484 49,531,438 49,170,933 39,646,518 34,095,108
Non Mark-up /
Interest
Administrative expenses 18,709,969 17,476,862 15,860,242 12,327,496 10,107,189
other provision –net -52,285 -187,305 514,646 88,261 -72,740
Other charges 928,595 817,824 1,402,756 990,638 690,150
Total non -mark-up
/interest Expenses 19,586,279 17,889,531 17,777,644 13,406,395 10,940,163
Extraordinary/ unusual
item _ _ _ _ -
Profit Before Taxation 32,288,205 31,641,907 31,321,782 26,509,636 23,154,945

79
Taxation 7,659,648 6,492,966 6,358,272 4,096,072
Current year 15,170,974 9,600,760 9,739,369 8,053,368 7,703,305
Prior Year - 116,725 1,038,662 -2,232,226
Defered -4,378,107 1,251,420 1,312,316 1,554,809 2,188,569
10,792,867 10,968,905 12,058,273 9,637,510 7,659,648
Profit After Taxation 21,495,338 20,673,002 19,424,906 16,872,126 8,922,415
Unappropriated profit
brought Forward 35,424,921 28,723,928 23,458,429 17,821,670 9,193,332
Transfer from surplus
on revaluation of fixed
assets – net of tax 35,788 35,789 36,182 21,879 22,324
35,460,709 28,759,717 23,494,611 17,843,549 9,215,656
Profit Available For
Appropriation 56,956,047 49,432,719 42,768,927 34,717,568 24,710,953

80
13 Ratio Analysis
Trend/Ratio Analysis
Five Years Financial Summary 2009 - 2013
Ratios 2013 2012 2011 2010 2009
Debt Ratio 1.156 1.160 1.163 1.168 1.159
Time interset earned
ratio 2.992 2.885 2.598 2.751 3.023
Profitability ratios
Net markup/interest
margin 4.99% 5.23% 6.23% 5.82% 5.59%
Non-interest income to
Total Assets Ratio 1.37% 1.19% 1.25% 1.13% 1.11%
Gross spread
63 59 60 61 55
Admin. expense to non-
markup/ 1.675 1.909 1.924 1.914 1.791
Admin. expense to profit
before tax. 0.58 0.55 0.51 0.47 0.44
Return on assets % 2.72% 2.91% 3.18% 3.13% 3.25%
Modified dupond
formula
Leverage 80.596 83.867 78.551 75.042 73.683
Return on equity
2.124 2.247 2.320 2.219 1.291
Market ratios
Total Equity to Total
Asset 0.012 0.012 0.013 0.013 0.014
Book Value per 96.13 96.62 94.37 91.00 88.37

81
Earnings per share
(before tax) 31.91 34.40 37.46 34.87 33.50
Earnings per share (after
tax)
21.24 22.47 23.23 22.19 12.91
Capital ratio 12% 12% 12% 12% 12%
Liquidity ratios
Gross advances to
deposits ratio 0.424 0.481 0.5088 0.636 0.734
Total liabilities to total
assets 86.48% 86.20% 85.99% 85.63% 86.30%
Investments to deposits
ratio
71.01% 74.42% 64.95% 50.02% 45.47%
Deposits to shareholder
equity
62.49 59.25 58.73 56.73 53.19
Assets to equity
80.60 83.87 78.55 75.04 73.68
Share Information
Market value per share-
Dec 31 281.17 209.76 134.6 228.54 219.68
High - during the year 323 216.75 250.48 233.8 244
Low - during the year 182.2 133 134 173.04 75

82
Graphical Representation:
There is fluctuation in the debt ratio of MCB bank.
Time interest earned ratio increased after 2011.

83
Net mark up to interest margin ratio shows decreasing trend after 2011.
Non interest income to total asset ratio shows fluctuation in five year.

84
Gross spread ratio looks at the spread of interest between borrowing and lending. Higher
Gross spread ratio of MCB Bank indicates a higher profit margin for the bank.
Admin exp / non markup Income ratio measures the proportion of bank's admin expense in
relation with non-markup/interest earned. After 2011 ratio shows decreasing trend.

85
Admin exp / PBT measures the proportion of bank's admin expense in relation with Profit
before tax. Ratio has fluctuation in five years.
ROA ratio measures the overall effectiveness of management in generating profit with its
available asset.ROA ratio is fluctuating but less than 4%. It shows the ineffectiveness of
management I generating profit.

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