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Mcb internship report

The document is an internship report submitted by Mazhar Abbas to Zainb Akram, detailing Abbas' 6-week internship at MCB Bank Limited in Multan, Pakistan. The report provides an executive summary of Abbas' tasks in the bank's remittance department, filling forms for transactions like pay orders, online transfers, and demand drafts. It also includes background information on MCB Bank, its vision, organizational structure, products and services, SWOT analysis, and marketing strategies. Abbas describes the processes for account opening, clearing transactions, and different types of remittances during his internship.

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COMSATS Institute of Information Technology, Lahore Department of Management Sciences Internship Report On MCB Bank Limited Masoom Shah Road Multan SUBMITTED TO: ZAINB AKRAM (Lecturer) SUBMITTED BY: MAZHAR ABBAS BBA-SP10-036 DATED: Sep 24, 2012 COMSATS Institute of Information Technology, Defiance Road Lahore Internship Report on MCB bank Page 1
EXECUTIVE SUMMARY I have done my internship in MCB Bank limited (Muslim Commercial Bank Limited). The main purpose of internship was to learn, by working in practical environment and to apply the knowledge acquired during the studies. There was only one department named as general banking. I had worked in Remittance, where I filled Pay Order, Online transfer, Demand Draft, Call Deposit Receipt forms. I did all type of clearing named as Normal Clearing, Same Day Clearing, and Intercity Clearing. I have opened new account for new customer. I successfully completed the entire tasks that were assigned to me. During the six week time period of my internship I learned about different things that how the Branch Manager deals with the customers and Staff. I learned that what kinds of documents are required for different kinds of financing activities or opening new account etc. Those things which I have mentioned above have been discussed in detail and all the procedures have been describe thoroughly. In this report there detail back ground, vision and mission statement and business operation (organization Structure, SWOT Analysis, Marketing Strategy, Competitive Strategy, Business Process Analysis) and some relative material of MCB Bank Limited. I have done my best I hope to ALLAH that this report will provide a complete and clear image of Muslim Commercial Bank Limited. Internship Report on MCB bank Page 2
Internship Report on MCB bank Page 3
Acknowledgement First of all I thanks to ALLAH that HE gave me courage and ability to do this difficult task. Secondly, I see that the credit goes to my loving parents and my respected teachers who make me able to be at this position. Finally I thankful to all the staff members of MCB limited Bank (Masoom Shah Road Multan1186) Specially the Branch manager Shahid Mahmood and General Banking officer Shaid Akhtir Walha. Internship Report on MCB bank Page 4
TABLE OF CONTANT Executive Summery 02 Dedication 03 Acknowledgement 04  Vision and Mission 07  Background 08 Awards 09 Values 10  Business Operation  Organizational Structure 12 Board of Directors 13 Products & Services 14  SWOT Analysis i. Internal Analysis 17 ii. External Analysis 19  Marketing Strategy 20  Competitive strategy 23  Business Process Analysis a. Horizontal analysis of Balance Sheet 28 b. Horizontal analysis of Income Statement 29 c. Horizontal analysis of Balance Sheet 30 d. Horizontal analysis of Income Statement 31  Plan of internship program Account opening department 35 36 i. Current account 36 ii. Saving Account 37 iii. Term deposit account 37 Clearing department 40 i. Outward clearing 41 ii. Inward clearing 43 Internship Report on MCB bank Page 5
TABLE OF CONTANT Remittances department 44 i. Demand Draft (DD) 45 ii. Pay order ( PO) 45 iii. Online transfer 45 iv. Call Deposit Receipt (CDR) 46 v. Deposit slip 46  References Internship Report on MCB bank 48 Page 6
 VISION & MISION STATEMENT Vision Statement “To be the leading financial services providing, partnering with our customers for a more prosperous and secure future.” Mission Statement “We are team of committed professionals, providing innovative and efficient financial solutions to create and nature long term relationships with our customers. In doing so, we ensure that our share holders can invest with confidence in us.” Internship Report on MCB bank Page 7
BACKGROUND OF MCB bank The MCB was established one month before the independence in June 1947. First head quarter in Calcutta and after independence it was shifted from Calcutta to Dhaka and afterward its head quarter were shifted from Dhaka to Karachi in 1948. Among the other 22 scheduled banks with 3525 branches network nationalize on 01st January1974 through the nationalization of Bank act 1974, under the nationalization policy of the Government. MCB was also nationalized and at that time of nationalization Premier Bank was merged in MCB Bank Limited in 1974. After the failure of the communism it was realizes through the world the idea of nationalization was not correct and has no any positive effects on economy. This idea developed especially in 1980 decade under which in sub continent of Asia its importance was also realized. In Pakistan privatization and deregulation policy was stared in1998 under this policy the first unit privatized was MCB with a view to stable the economy and reduce the burden of national exchequer of other sick units. In 1990 this bank was announced for privatization on the ground that 51% shares would be for general public out of which 26% shares would be offered to particular party, which will take the administration of bank and lead by Mian Muhammad Mansha who was the first chairman of MCB LTD. Internship Report on MCB bank Page 8
AWARDS  Year 2011 2011 CFA Association Pakistan Most stable of the year 2011 CFA Association Pakistan Best Bank of the year 2011 Euro money Best Bank in Pakistan 2011 ICAP/ICMAP BCR Award2010-Banking sector 2011 SAFA Join 2 nd Runner-up for BCR 2010  Year 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 BCR Award 2009-Banking Sector 2010 SAFA Certificate of Merit Award for BCR 2009  Year 2009 2009 Asia money Best Domestic Bank in Pakistan 2009 The Asset Best Domestic Bank in Pakistan  Year 2008 2008 Euro money Best Bank in Asia 2008 Euro money Best Bank in Pakistan 2008 Asia money Best Domestic Bank in Pakistan  Year 2006 2006 Asia money Best Domestic Bank in Pakistan 2006 Euro money Best Bank in Pakistan Internship Report on MCB bank Page 9
 Year 2004 2005 Asia money Best Domestic Bank in Pakistan 2005 Euro money Best Bank in Pakistan  Year 2004 2004 Euro money Best Bank in Pakistan 2004 Asia money Best Domestic Bank in Pakistan  Year 2003 Euro money Best Bank in Pakistan  Year 2001 Euro money Best Bank in Pakistan  Year 2000 Euro money Best Bank in Pakistan  VALUES Integrity We are the trustees of public funds and serve our community with integrity. We believe in being the best at always doing the right thing. We deliver on our responsibilities and commitments to our customers as well as our colleagues. Innovation We encourage and reward people who challenge the status quo and think beyond the boundaries of the conventional. Our teams work together for the smooth and efficient implementation of ideas and initiatives. Internship Report on MCB bank Page 10
Excellence We take personal responsibility for our role as leaders in 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. Respect We respect our customers’ values, beliefs, culture and history. We value the equality of gender and diversity of experience and education that our employees bring with them. We create an environment where each individual is enabled to succeed. Internship Report on MCB bank Page 11
 BUSINESS OPERATION  Organizational Structure Internship Report on MCB bank Page 12
 Board of Directors  Main Muhammad 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)  Dati’ Muhammed Hussain (Non executive Director)  Dato’ Seri Ismail Shahudin (Non executive Director)  Main Raza Mansha (Non executive Director)  Main Ahmad Khan (Non executive Director)  Main Umer Mansha (Non executive Director)  Ahmad Alman Aslam (Non executive Director)  M.U.A Usmani (Executive Director) President & Chief Executive Officer  Audit Committee Tariq Rafi (Non executive Director) Aftab Ahmad Khan (Non executive Director) Dati’ Muhammed Hussain (Non executive Director) Dato’ Seri Ismail Shahudin (Non executive Director) Ahmad Alman Aslam (Non executive Director)  Chief Financial Officer Salman Zafar Siddiqi  Company Secretary Abdus S. Sami  Auditors A. F. Forguson & Co. Chartered Accountants Internship Report on MCB bank Page 13
Products& Services Provided by MCB bank  MCB RETAIL BANKING DEPOSIT ACCOUNTS Current Account Savings Account Special Term Deposits  MCB ONLINE SERVICES MCB ATMs MCB Call Centre MCB Mobile MCB Mobile ATM MCB Online Banking  MCB LOAN PRODUCTS MCB Car4U Business Sarmaya Pyara Ghar Easy Personal Loan MCB Instant Finance  MCB CARDS MCB Smart Card Debit Card MCB Visa Credit Card Internship Report on MCB bank Page 14
 MCB INVESTMENT BANKING Project & Structured Finance Syndicated Loans and Debt Capital Markets Quasi Equity/Hybrid Instruments Equity Capital Raising Advisory Services Facility Administration Commercial Banking  MCB CORPORATE FINANCING Working Capital Loans Term Loans Trade Finance Services Cash Management Transaction Banking Division  MCB BANCASSURANCE  MCB’S REMITTANCE  MCB AGRICULTURE PRODUCTS Shadabi Plan Khushali Scheme Tractor Finance Scheme Aabiari Scheme Grower Finance Dairy & Meat Plan Internship Report on MCB bank Page 15
Murghbani Scheme Baghbani Mahigeri Schemz  VIRTUAL BANKING Deposit Schemes Fund Based Facilities Ijarah Products Types of Ijarah  Car Ijarah  Equipment Ijarah Murabahah Musharika Equipment  PRIVILEGE BANKING  OTHER SERVICES MCB MNET MCB Salary Club MCB Lockers MCB SMS Banking MCB Full Day Banking Internship Report on MCB bank Page 16
 SWOT Analysis There are two part of SWOT Analysis Internal Analysis External Analysis  Internal Analysis Strengths: The strengths of MCB Bank are the following: 1. MCB is the first Pakistani privatized bank because of its quality management, marketing, innovation in product and services is performing well in financial market. 2. It has created a good reputation in the banking sector. 3. It has 1200+ branches on different places in Pakistan. 4. It has one of the nation’s largest ATM network with more than 500 ATMs covering 110 cities across the country and it is still growing. 5. It provides MCB mobile ATM for convenient world class banking services. Internship Report on MCB bank Page 17
Weaknesses: 1. Mismanagement of time is the biggest mistake in MCB branches that the official time of bank closing is 5:30pm but the staff is normally on their seats till 7:00pm to 9:00pm. 2. Due to the lack of advertisement majority of the people are not well aware about the products of MCB. 3. There is lack of specialized skill because of rotation policy of human resource management. 4. Most of the staff and employees are dissatisfied due to low salaries as compared to same position in other banks. 5. It is also seen that the staff complain about over loaded of work. It is the reason that turnover ratio of MCB is increasing. 6. MCB has numbers of employees of the period when the MCB was nationalized bank they cannot perform their duty as like employees in other banks. They always show rude attitude that is not much motivating for new customer. 7. There is lack of skills and training of employees.MCB have to gave attention to improve the skills and abilities of the employees according to modern banking requirements. Internship Report on MCB bank Page 18
 External Analysis Opportunities: 1. MCB bank can capture big portion of the market by expanding their branches and ATM network to other countries. 2. MCB have to launch some new product or services like tele bank and internet banking etc. 3. Media is powerful tool of communication.MCB have to use it for advertisement of new product and severs provided by MCB bank. By adverting MCB can create more new customers. 4. MCB bank has to start some kind of Social services or for culture benefit. By doing this it can motivate its customer that you are contributing in this services by parching and using MCB services. 5. Now the concept of Islamic banking is increasing in Pakistan. There is opportunities that by creating Islamic branches all over the country and fallow Islamic structure in those branches. It should also creat Islamic product for customers Threats: 1. In Pakistan the banking sector is growing rapidly and it has attracts the business men to enter in banking sector. Some foreign banks have started their business in Pakistan. Now MCB bank has to compete with great effort by giving superior services. 2. From few years Pakistan is facing a lot of problems like energy crisis, rising prices of product. Govt. of Pakistan is borrowing money from State Bank of Pakistan and from commercial banks also and due to lack of money to give to depositor many banks can cause to bankrupt. 3. Foreign banks are increasing in Pakistan 4. Foreign banks are providing attractive and new services to MCB customer. Internship Report on MCB bank Page 19
 Marketing Strategy MCB bank is using different kind of marketing Strategies to expand their business. MCB bank is using marketing mix strategy for promotion. It is a set of marketing tools which is used to find out the marketing objectives in the target market. These tools are classified into four factors named as 1. Product: MCB bank has started new services and product to satisfy the customers. Different kind of accounts are offered by the MCB bank to attract the customers. Mahana Khushali Plan : It is a five year plan in which amount is deposited for five years and return is given on monthly basis. By this play MCB bank is targeting those people who want to save their money and want some return on their investment. Capital Growth Certificate plan: This plan is offered to target those person that deposit their amount for long period of time. According to this plan your deposited amount will be double after five year. Internship Report on MCB bank Page 20
Night - Banking Services: MCB has started these services on busy commercial centre for the ease of their customer. Now traders and other client can deposit their amount in these services centres till 8:00Pm. There are many other products and services that the MCB bank had lunched. By providing such kind of products MCB has attracted the consumers from outside the bank market and core account from competitors. 2. Price: It is a critical marketing tool. It represent that what customer have to pay against services received. It is the only element that creates revenue for MCB bank. Some time pricing strategy is also used to set the price. In the start prices were low but after creating the image MCB bank has raised their charges. There come some objectives in setting the price some of objectives are Maximization of profit, obtaining market share, rate of return on investment etc. 3. Place Place is used in since of distribution channel ,and distribution mean that from where the seller makes his products available to the buyers.MCb bank is using to important channels of distribution. Bank Branches Bank Credit Card Internship Report on MCB bank Page 21
Bank branches: Bank branches are the most important channel of distribution for the bank. Through these branches MCB is easily serving potential customers. The largest portion of business is being generated from these branches. The bank has also started Saturday banking in all big cities with ATN network. Bank Credit Cards: MCB has made the contract with Master Card International and made the ac cess of the card possible at 11 million outlets all over the world. Due to use of this card there is rapidly increase in the usage of banking services. 4. Promotion MCB bank use this tool for different activities. BY using different ways MCB is targeting the customers to use their product or services. MCB Ltd has used this tool to spread information about their services and product. MCB bank is using four basic promotional tools for promotion and those promotion tools are the following. Advertising Personal selling Publicity Sales promotion Internship Report on MCB bank Page 22
 Competitive Strategy After making the mix structure of basic elements of marketing the banks focus on growth strategies. Growth strategy is further divided in to four strategies: Market Penetration Strategy Market Development Strategy Product Development Strategy Diversification Strategy 1. Market Penetration Strategy With the help of this strategy the bank management first consider either it could gain more market share or not with its current products in their current markets. 2. Market Development Strategy: In this it considers whether it can find or develop new markets for its current products. 3. Product Development Strategy: Then, it considers whether it can develop new products of impending interest to its current markets.  Diversification Strategy: Finally it will review opportunities to develop new products for new markets. These strategies have been examined further as follows: Internship Report on MCB bank Page 23
Market penetration: By using this strategy MCB bank is increasing its sale with existing product in the existing market by means of increased and more effective positioning and targeting, delivery and promotional activities. Some basic strategies are: Selling present services to new customers Selling more services to present customers Market development: MCB is using this strategy to increase sale in new markets with existing products and services. Product development This strategy is used to introduce the new product or services in the existing market. Diversification It is also growth strategy and it is most difficult growth strategy for bank. In this strategy the bank focuses on to grow new services and new markets. Internship Report on MCB bank Page 24
 Business process Analysis Internship Report on MCB bank Page 25
Internship Report on MCB bank Page 26
Internship Report on MCB bank Page 27
 Business process Analysis  HORIZONTAL ANALYSIS OF BALANCE SHEET 2011 2010 2009 100% 100% 100% 2008 100% 2007 100% Assets Cash Due from Banks 100 90.51 90.06 91.32 89.35 Other Assets Total 100 84.88 61.02 51.86 53.86 Net Loans 100 91.23 90.19 78.35 64.32 and 100 99.54 99.16 98.59 98.3 and 93.45 91.35 68.91 81.29 and 100 85.46 71.56 62.46 53.17 100 97.43 88.86 83.67 93.57 (87.25) (68.96) (56.36) (62.77) Land Improvements Building Improvement 100 Furniture Equipment Gross Fixed Assets Accumulated Depreciation (100) Net Fixed Assets 100 100.24 94.79 92.95 99.59 Intangibles 100 23.67 37.07 25.65 29.85 in 100 100 0.00 0.00 0.00 Current 100 87.22 38.44 40.18 0.00 100 83.99 82.35 77.09 66.29 Goodwill (Cost Excess) Other Non Assets Total Assets Liabilities Accounts Payable 0.00 345.92 185.35 0.00 17.49 Accrued Expenses 100 88.66 82.53 75.06 65.19 Long Term Debt 100 123.07 67.96 29.24 36.38 Total Debt 100 74.96 168.94 152.48 45.23 Def. Income Tax Lib. 0.00 0.00 0.00 0.00 509.0 Internship Report on MCB bank Page 28
Minority Interest Liabilities 100.52 22.39 22.74 22.14 100 Other Liabilities Total 100 75.02 72.21 76.49 63.19 Total Liabilities 100 89.10 80.98 70.29 4.59 Common Stock Equity 100 79.99 62.82 53.33 48.48 Retained Earnings 100 95.09 87.79 75.89 65.92 Equity Gains or Losses 100 111.31 109.03 94.52 208.4 Equity Adjustments 100 110.01 110.34 94.26 56.85 100 96.68 89.58 77.12 87.07 and 100 89.99 82.0 71.09 66.29 Stockholders’ Equity Total Equity Total Liabilities Stock Equity  HORIZONTAL ANALYSIS OF INCOME STATEMENT 2011 2010 2009 2008 2007 100% 100% 100% 100% 100% Interest Income Bank 100 92.67 81.64 63.91 53.13 Total Interest Expense 100 93.10 81.31 48.22 35.09 Net Interest Income 100 92.24 81.98 79.02 71.68 Loan Loss Provision 100 106.96 126.31 117.65 50.47 Net Interest Income 100 88.59 70.02 69.45 76.93 Non Interest Income 100 91.88 96.73 84.45 70.57 After Loan Loss Provision Non-Operating Expenses Bank Internship Report on MCB bank Page 29
Non Interest Expense (100) (85.94) (75.56) (62.62) (46.3) Bank Pre Tax Income 100 94.28 85.00 89.02 108.9 Income Taxes 100 81.88 48.76 89.98 107.6 100 100.55 102.19 88.53 109.4 Net Income Available 100 100.55 102.19 88.53 109.4 Non-Recurring Events Total Net Income For Common stock  VERTICAL ANALYSIS OF BALANCE SHEET 2011 2010 2009 2008 2007 100% 100% 100% 100% 100% Cash Due from Banks 13.86 14.10 15.37 17.83 17.42 Other Assets Total 30.96 30.58 23.94 22.16 26.07 Net Loans 45.68 46.12 50.24 50.36 44.56 Land and Improvements 1.47 1.63 1.77 2.03 2.69 Building and Improvements 0.004 0.0048 0.049 0.0053 0.0054 Furniture and Equipment 0.008 0.0083 0.0075 0.0074 0.0067 Gross Fixed Assets 2.77 2.96 3.01 3.31 3.9 Accumulated Depreciation (0.006) (0.0055) (0.0051) (0.0048) (0.0057) Net Fixed Assets 2.16 2.41 2.5 2.83 3.33 Intangibles 0.00006 0.000018 0.000031 0.000025 0.000031 Goodwill (Cost in Excess) 0.0004 0.000054 0.00 0.00 0.00 Other Non Current Assets 0.0069 0.0066 0.0032 0.0039 0.00 Total Assets 100 100 100 100 100 Accounts Payable 0.00 0.0003 0.00019 0.00 0.00002 Accrued Expenses 0.0097 0.0096 0.0098 1.03 0.0096 Assets Liabilities Internship Report on MCB bank Page 30
Long Term Debt 0.00008 0.00012 0.00004 0.00003 0.00004 Total Debt 2.31 1.93 4.77 4.96 1.58 Def. Income Tax Lib. 0.00 0.00 0.00 0.00 0.0066 Minority Interest Liabilities 0.0004 0.00047 0.00012 0.00014 0.00014 Other Liabilities Total 2.45 2.04 2.16 2.57 2.33 Total Liabilities 88.27 87.39 87.17 87.27 84.59 Common Stock Equity 1.46 1.29 1.13 1.09 1.06 Retained Earnings 7.72 8.16 8.26 8.2 7.68 Equity Unrealized 1.95 2.42 2.62 2.6 6.15 Equity Adjustments 0.0059 0.0072 0.0079 0.0078 0.0050 Total Equity 11.73 12.6 12.82 12.72 15.4 100 100 100 100 2008 100% 2007 100% Stockholders’ Equity Total Liabilities and Stock 100 Equity  VERTICAL ANALYSIS OF INCOME STATEMENT 2011 100% 2010 100% Interest Income Bank 540.26 498.94 Total Interest Expense (273.92) (253.63) 2009 100% 431.61 (217.93) 389.97 262.16 (152.27) (87.79) Net Interest Income 266.32 244.32 213.67 237.7 174.36 Loan Loss Provision (52.83) (56.20) (65.30) (70.21) (24.35) Net Interest Income 213.50 188.12 148.37 167.49 150.01 101.92 105.57 106.39 71.89 (125.62) (75.19) after Loan Loss Provision Non-Operating Expenses Non Interest Income 111.53 Bank Non Interest Exp. Bank (177.58) Internship Report on MCB bank (151.77) (131.30) Page 31
Pre Tax Income 147.45 138.25 122.64 148.26 146.70 Income Taxes (47.46) (38.65) (22.65) (48.24) (46.64) Minority Interest 0.000001 0.0039 0.000098 5 (0.00019 (0.00061) ) Non-Recurring Events Total Net Income 100 100 100 100 100 Net Income Available 100 100 100 100 100 For Common Stock Holder Internship Report on MCB bank Page 32
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 Assets of MCB bank is increased by 15% to Rs. 653 Billion  Deposits is increased to Rs. 491 Billion  Gross advances came down Rs. 248 Billion  Share holder Equity is creased to Rs. 79 Billion  Profit after tax is increased to Rs. 19.4 Billion  Income from dealing in foreign currencies increased by 46%  Return on assets improved from 3.13% in 2010 to 3.18 in 2011.  Earnings per share is increased to Rs. 23.23 in 2011as compared to Rs.20.18 in 2010 Internship Report on MCB bank Page 34
Details plan of my internship program  Introduction of branch: I have done my six weeks internship from MCB bank limited (1186) Masoom Shah Road Multan under the branch manager Shahid Mahmood. This is a online branch of MCB bank and this branch is doing good business. The question comes in how? Reasons behind this are firstly, when the branch manager joins this branch he brings some account with him. Secondly, this branch is on exact location on the main road and different are around it. Thirdly, the Staff of this branch is much cooperated they work like a time that’s why the working of management is very smooth and efficient. Finally, this branch have very good contact and the relation with the shops business entities and the other sound parties as well to increase the deposit of the branch and maintain the efficiency of the work and enhance the organization. The branch manager Shahid Mahmood introduced me with staff members and guided me about different functions being operated within the organization.  Starting and the ending dates of my internship Starting and the ending dates of my internship program in the MCB bank limited (1186) Masoom Shah Road Multan. Starting Date: September 25, 2012 Ending Date: August 05, 2012 Internship Report on MCB bank Page 35
 Names of the departments where I have worked during my internship duration 1. Account opening department 2. Clearing department 3. Remittances department 1. Account Opening Department I have worked one week in account opening department. It is the most important department of any branch of any bank because all the working of the bank is based on the account. It is the first step between the customer and banks. I opened new accounts some for new customers and some for old customers because they want to operate more than one account. There are different types of accounts in MCB bank limited which are offered to its customers. Different accounts has different benefits different charges different minimum balance requirement and different purposes. There are three types of account. 1. Current account 2. Saving account 3. Term deposit account  Current Account: MCB Bank offers a variety of current accounts to provide to the everyday transactional needs of various customers. These accounts ensure ease and freedom to bank from any of the 1100+ branches across the country. The different accounts include: i. Normal Current Account that has 10,000 rupees minimum balance requirement. Internship Report on MCB bank Page 36
ii. Business Account that has 50,000 rupees minimum balance requirement. It is offering free online transactions, Demand Drafts, Pay Orders and lots more to meet the day to day business requirements iii. Current Life Account which offers the security of life insurance free of cost and for all others, the conventional Current Account. Note: If the balance goes down from the minimum balance required then the bank will be charged Rs.50 as per mint.  Saving Account: MCB Bank 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. i. PLS Saving Account has no minimum balance requirement and it offer profit rate on semi annually balance. ii. Xtra Saving Account is targeted for customers having Rs. 5 million + deposit and it offer profit rate on quarterly balance. iii. 365 Gold Account offers profit rate on daily balance In addition, two unique products: Smart Savings and Savings Maximizer are special saving accounts run solely via debit cards and other remote banking channels, offering a very competitive rate to both high and low end savers.  Term Deposit Account: MCB Term Deposit 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. Internship Report on MCB bank Page 37
To open term deposit account the minimum balance requirement is one lack rupees. Term deposit account can be opened for one month, three month, six month, one year, three year, and five year. The account will be closed after the term then new account will be open on the demand of customer. MCB bank limited is offering some other types of account these are mention below.  Basic Banking Account: MCB bank is offering these services to those people who have low income without any charges. No Zakat is deducted from their balance and there is no profit no loss on this account.  Khushali Bachat Account: It offer profit rate on semi annually balance. For opening of new accounts there are required some documents For individual account Account opening form Attested photocopy of computerize National Identity Card or Passport of individual. In case of salaried person, attested copy of his or her service card or any other acceptable evidence of service, including, but not limited to a certificate from employer. If the person has his or her own business then the letter pad copy is needed. Internship Report on MCB bank Page 38
In case of illiterate person, two receipt passport size photographs of the new account holder besides taking his right and thumb impression on the specimen signature card. For Joint Stock Companies Account Certified copies of Resolution of board of directors for opening of account specifying the person or person’s authorized to operate the company account. Memorandum and Article of Association Certificate of incorporation Certificate of commencement of business Attested photo of Computerized National Identity Card of all Directors. List of Directors in from-29 issued for the Register Joint Stock Companies. For Partnership Account Attested photocopy of computerize National Identity Card Attested copy of “ Partnership Deed” or “letter of Partnership” Attested copy of Registration Certificate with Registrar of the firm. In case of Partnership is unregistered, this fact should be clearly mentioned on the Customer Relationship form. Authority Letter in original, in favor of the person or other person who is authorized by the partners. Account Opening Form is filled and necessary documents are attached with this Form and are sent to main Branch. After verification the main branch send mail of verification then the new is activated. Internship Report on MCB bank Page 39
2. Cleaning department I have worked two weeks (2nd ad 3th ) in clearing department. I learned the functions and work which are performed by this department. This is the important department of any bank. General banking officer (GPO) Shahid Akhtar Wahla taught me about clearing. He told me that it is a process in which the banker settle their mutual account by claiming the arising account of various instruments presented by one bank drawn on the other bank either the bank is in the same city or out of city. Suppose an NBP account-holder gives a crosscheck for MCB. Similarly, MCB accountholders give check to people having accounts in other banks; these all banks need to clear their overall balances with each other. The clearing department does this. Clearing checks MCB Account-holder X NBP Account-holder Cross check Y NBP Bank MCB Deposited In clearing we deal with the cheques of other banks or other branches of MCB. The clearing is done with the help of NIFT (National Institutional Facilitation Technologies). It is the institute which the state bank has hired for the collection of clearing cheques of each branch and it plays middle man role between each branch with State Bank of Pakistan. He told me that clearing are of two types  Outward clearing  Inward clearing Internship Report on MCB bank Page 40
 Outward clearing Out ward clearing is that the settle of claims of our branch of MCB bank but drawn on other branches of MCB or on other banks .These cheques are deposited by our customer in our MCB branch and then our MCB bank branch present it in out ward clearing. GPO told me that there are three types of out ward clearing. i. Normal clearing ii. Someday clearing iii. Intercity clearing Before starting clearing GPO gave me the first task to record the detail of cheques in the cheque Collection ( CC ) ledger. The detail includes pay account number, cheque number, cheque amount, bank name of which the cheque is. And I wrote the all amount of all cheques on Add list and add it. Two copies were made one original and second carbon copy. I attached add list and all the bank copy of deposit slip which were filled from customer in the CC ledger. GPO appreciated me that your calculation is good. The same task is done either it is Normal, Same day, or intercity clearing. These are the following detail are required in Clearing Register. 1. Serial No. 2. Account no. of the depositor 3. Depositor name 4. Drawer 5. Drawee 6. Cheque No. 7. Amount of the cheque Internship Report on MCB bank Page 41
 Normal clearing Normal clearing is made at afternoon which would be present on next day.Two stamps are stamped one on front of clearing date stamp and one on back manager stamp that payee account will be credited with signature. It deals with in city. Time limit of this type of clearing is two days. Return on paid charges are Rs.300 which are deducted from the depositor account is case of retire of cheque.  Same day clearing Same day is made initial working hours and are presented on the same day. Two stamps are stamped on frount of the cheque and one on back of the cheque. On front side, one stamp of Same day clearing and second stamp of clearing date on which cheque has to present. On back side, manger stamp that payee account will be credited, and manager signature also. Its charges are Rs.350 only charges that are deducted from the account of holder account.  Intercity clearing Where there is State Bank of Pakistan then the clearing is done by NIFT and if not then another institute is worked so CC ( cheque collection ) is made. Three stamps are stamped two on front side and one on back side. On front side one stamp of intercity clearing and other is clearing date on which it has to present. On back side manager stamp that payee account will be credited and manger signature also. Internship Report on MCB bank Page 42
Charges for intercity clearing MCB 0.15% of total amount of cheque including 75 rupees posting charges (Minimum charges are 100 rupees) For other banks 0.25% of total amount of cheque. Excise duty 0.16% In paid charges are 500+75posting charges In case of normal clearing, detail information is recorded the detail in ledger. A clearing schedule slip is arranged with the branch code stamp, total amount and number of instruments and add list is also attached with clearing schedule slip then a plastic seal number is required which is written on the seal. After matching the detail of clearing Register with clearing schedule slip all the instruments, add list, outline page are putted in an envelope and packed in NIFT bag and that NIFT bag is closed with that plastic seal. This is to ensure additional safety. When the seal is opened then the bank will not receive that bag., If the seal number on the bag and on the bundle cover does not match in this case it is a suggestion that some sort of changes has been made the strict action are taken by NIFT and the Bank consequently. The procedure is same for same day clearing and intercity clearing.  Inward clearing In inward clearing other banks or other branches of MCB also settle their account by claiming the instruments which are drawn by the other bank customers or other branches of MCB bank. This is inward clearing other banks sent instrument to our branch which are drawn on us. There are few things which are included in inward clearing. Internship Report on MCB bank Page 43
a. The cheques should be cross cheques or there should be cross stamp on face side of the cheque. b. Clearing stamp on the front side of the instruments. c. The clearing stamp dated should be of the next working day d. Manger stamp that Payees account is credited on the bake of the instruments and signature on the stamp e. The signature is to be verified before entering into computer and then the cheque is posted and drafted. 3. Remittance Department I have worked two weeks (4th and 5th ) In Remittance Department. We deal with different functions and different instruments in this department. Those instruments and function are: 1. Demand Draft (DD) 2. Pay order ( PO) 3. Online transfer or internal transfer 4. Call Deposit Receipt (CDR) 5. Deposit slip 1. Demand Draft (DD) Demand draft is like an instrument and is issued on the demand of the customer.DD has abominate the extra burden of the currency. It is payable on the demand when the customer want it. It is issued by the one branch of the bank and is payable by another branch of the same bank. Information required for DD Internship Report on MCB bank Page 44
 Beneficiary Details Beneficiary Name Bank or Branch Name and address Purpose of remittance 2. Pay order (PO) PO is the kind of instruments and it is the property of customer. It is used for the payment of admission fee, tender or for payments of dealing. In case of PO the issue bank and paying will be the same but branches may be different in that city. It flows within the city. 3. Online Transfer The amount can be transfer from one account to another account either the account is of that branch or any branch of MCB in any city. If the amount is being transferred through cheque then online charges are Commission Rs.125 Excise duty Rs.020 Total charges Rs.145 If the amount is being transferred through Cash then the charges are different. If the amount is less than Rs. 25000 then Commission Rs.150 Excise duty Rs. 024 Total Charges Rs. 174 If amount exceed from Rs.25000 then the taxes is also applied due to this total charges also changed. Internship Report on MCB bank Page 45
Information required for online  Beneficiary Details Beneficiary Name Bank or Branch Name and address Purpose of remittance  Applicant Detail Name or Title off account Account number CNIC or Passport No.(for Non Account Holder) Signature of Applicant 4. Call Deposit Receipt (CDR) It is highly liquefied instrument which can be cashed at any time on the demand of customer. it is used for tender purpose.CDR show that the specific mentioned account is present in between customer and other party with which deal is being done. In this case issue and paying branch is same. 5. Deposit Slip There are two copies of deposit slip one is for bank use and other for customer use. We fill deposit slip in case of cash deposit in account holder account and when any cheques come in the branch. In my last week (6th) of internship period I have collected the information related to my internship. At end of last week Branch manager Shahid Mahnood taken my Internship Report on MCB bank Page 46
test what I were learned from the organization and then fill my evaluation form and gave the internship letter to me. This was the worked that I had learned from MCB bank limited. I have used great effort to learn about banking sector hoped that this effort will provide me opportunities. It is great edge for me in the job market. It gave a lot of confidence that to deal the customers. It will create positive impact on my future. Internship Report on MCB bank Page 47
REFFERENCES  http://www.mcb.com.pk/mcb/about_mcb.asp  http://www.mcb.com.pk/psc/accounts/basic_account.asp  http://www.mcb.com.pk/mcb/our_values.asp  http://www.mcb.com.pk/mcb/awards_accolades.asp  Annual Report 2011 of MCB bank limitd Internship Report on MCB bank Page 48
Internship Report on MCB bank Page 49
Internship Report on MCB bank Page 50
Internship Report on MCB bank Page 51
Internship Report on MCB bank Page 52

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Mcb internship report

  • 1.
    COMSATS Institute ofInformation Technology, Lahore Department of Management Sciences Internship Report On MCB Bank Limited Masoom Shah Road Multan SUBMITTED TO: ZAINB AKRAM (Lecturer) SUBMITTED BY: MAZHAR ABBAS BBA-SP10-036 DATED: Sep 24, 2012 COMSATS Institute of Information Technology, Defiance Road Lahore Internship Report on MCB bank Page 1
  • 2.
    EXECUTIVE SUMMARY I havedone my internship in MCB Bank limited (Muslim Commercial Bank Limited). The main purpose of internship was to learn, by working in practical environment and to apply the knowledge acquired during the studies. There was only one department named as general banking. I had worked in Remittance, where I filled Pay Order, Online transfer, Demand Draft, Call Deposit Receipt forms. I did all type of clearing named as Normal Clearing, Same Day Clearing, and Intercity Clearing. I have opened new account for new customer. I successfully completed the entire tasks that were assigned to me. During the six week time period of my internship I learned about different things that how the Branch Manager deals with the customers and Staff. I learned that what kinds of documents are required for different kinds of financing activities or opening new account etc. Those things which I have mentioned above have been discussed in detail and all the procedures have been describe thoroughly. In this report there detail back ground, vision and mission statement and business operation (organization Structure, SWOT Analysis, Marketing Strategy, Competitive Strategy, Business Process Analysis) and some relative material of MCB Bank Limited. I have done my best I hope to ALLAH that this report will provide a complete and clear image of Muslim Commercial Bank Limited. Internship Report on MCB bank Page 2
  • 3.
    Internship Report onMCB bank Page 3
  • 4.
    Acknowledgement First of allI thanks to ALLAH that HE gave me courage and ability to do this difficult task. Secondly, I see that the credit goes to my loving parents and my respected teachers who make me able to be at this position. Finally I thankful to all the staff members of MCB limited Bank (Masoom Shah Road Multan1186) Specially the Branch manager Shahid Mahmood and General Banking officer Shaid Akhtir Walha. Internship Report on MCB bank Page 4
  • 5.
    TABLE OF CONTANT ExecutiveSummery 02 Dedication 03 Acknowledgement 04  Vision and Mission 07  Background 08 Awards 09 Values 10  Business Operation  Organizational Structure 12 Board of Directors 13 Products & Services 14  SWOT Analysis i. Internal Analysis 17 ii. External Analysis 19  Marketing Strategy 20  Competitive strategy 23  Business Process Analysis a. Horizontal analysis of Balance Sheet 28 b. Horizontal analysis of Income Statement 29 c. Horizontal analysis of Balance Sheet 30 d. Horizontal analysis of Income Statement 31  Plan of internship program Account opening department 35 36 i. Current account 36 ii. Saving Account 37 iii. Term deposit account 37 Clearing department 40 i. Outward clearing 41 ii. Inward clearing 43 Internship Report on MCB bank Page 5
  • 6.
    TABLE OF CONTANT Remittancesdepartment 44 i. Demand Draft (DD) 45 ii. Pay order ( PO) 45 iii. Online transfer 45 iv. Call Deposit Receipt (CDR) 46 v. Deposit slip 46  References Internship Report on MCB bank 48 Page 6
  • 7.
     VISION &MISION STATEMENT Vision Statement “To be the leading financial services providing, partnering with our customers for a more prosperous and secure future.” Mission Statement “We are team of committed professionals, providing innovative and efficient financial solutions to create and nature long term relationships with our customers. In doing so, we ensure that our share holders can invest with confidence in us.” Internship Report on MCB bank Page 7
  • 8.
    BACKGROUND OF MCBbank The MCB was established one month before the independence in June 1947. First head quarter in Calcutta and after independence it was shifted from Calcutta to Dhaka and afterward its head quarter were shifted from Dhaka to Karachi in 1948. Among the other 22 scheduled banks with 3525 branches network nationalize on 01st January1974 through the nationalization of Bank act 1974, under the nationalization policy of the Government. MCB was also nationalized and at that time of nationalization Premier Bank was merged in MCB Bank Limited in 1974. After the failure of the communism it was realizes through the world the idea of nationalization was not correct and has no any positive effects on economy. This idea developed especially in 1980 decade under which in sub continent of Asia its importance was also realized. In Pakistan privatization and deregulation policy was stared in1998 under this policy the first unit privatized was MCB with a view to stable the economy and reduce the burden of national exchequer of other sick units. In 1990 this bank was announced for privatization on the ground that 51% shares would be for general public out of which 26% shares would be offered to particular party, which will take the administration of bank and lead by Mian Muhammad Mansha who was the first chairman of MCB LTD. Internship Report on MCB bank Page 8
  • 9.
    AWARDS  Year 2011 2011CFA Association Pakistan Most stable of the year 2011 CFA Association Pakistan Best Bank of the year 2011 Euro money Best Bank in Pakistan 2011 ICAP/ICMAP BCR Award2010-Banking sector 2011 SAFA Join 2 nd Runner-up for BCR 2010  Year 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 BCR Award 2009-Banking Sector 2010 SAFA Certificate of Merit Award for BCR 2009  Year 2009 2009 Asia money Best Domestic Bank in Pakistan 2009 The Asset Best Domestic Bank in Pakistan  Year 2008 2008 Euro money Best Bank in Asia 2008 Euro money Best Bank in Pakistan 2008 Asia money Best Domestic Bank in Pakistan  Year 2006 2006 Asia money Best Domestic Bank in Pakistan 2006 Euro money Best Bank in Pakistan Internship Report on MCB bank Page 9
  • 10.
     Year 2004 2005Asia money Best Domestic Bank in Pakistan 2005 Euro money Best Bank in Pakistan  Year 2004 2004 Euro money Best Bank in Pakistan 2004 Asia money Best Domestic Bank in Pakistan  Year 2003 Euro money Best Bank in Pakistan  Year 2001 Euro money Best Bank in Pakistan  Year 2000 Euro money Best Bank in Pakistan  VALUES Integrity We are the trustees of public funds and serve our community with integrity. We believe in being the best at always doing the right thing. We deliver on our responsibilities and commitments to our customers as well as our colleagues. Innovation We encourage and reward people who challenge the status quo and think beyond the boundaries of the conventional. Our teams work together for the smooth and efficient implementation of ideas and initiatives. Internship Report on MCB bank Page 10
  • 11.
    Excellence We take personalresponsibility for our role as leaders in 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. Respect We respect our customers’ values, beliefs, culture and history. We value the equality of gender and diversity of experience and education that our employees bring with them. We create an environment where each individual is enabled to succeed. Internship Report on MCB bank Page 11
  • 12.
     BUSINESS OPERATION  OrganizationalStructure Internship Report on MCB bank Page 12
  • 13.
     Board ofDirectors  Main Muhammad 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)  Dati’ Muhammed Hussain (Non executive Director)  Dato’ Seri Ismail Shahudin (Non executive Director)  Main Raza Mansha (Non executive Director)  Main Ahmad Khan (Non executive Director)  Main Umer Mansha (Non executive Director)  Ahmad Alman Aslam (Non executive Director)  M.U.A Usmani (Executive Director) President & Chief Executive Officer  Audit Committee Tariq Rafi (Non executive Director) Aftab Ahmad Khan (Non executive Director) Dati’ Muhammed Hussain (Non executive Director) Dato’ Seri Ismail Shahudin (Non executive Director) Ahmad Alman Aslam (Non executive Director)  Chief Financial Officer Salman Zafar Siddiqi  Company Secretary Abdus S. Sami  Auditors A. F. Forguson & Co. Chartered Accountants Internship Report on MCB bank Page 13
  • 14.
    Products& Services Providedby MCB bank  MCB RETAIL BANKING DEPOSIT ACCOUNTS Current Account Savings Account Special Term Deposits  MCB ONLINE SERVICES MCB ATMs MCB Call Centre MCB Mobile MCB Mobile ATM MCB Online Banking  MCB LOAN PRODUCTS MCB Car4U Business Sarmaya Pyara Ghar Easy Personal Loan MCB Instant Finance  MCB CARDS MCB Smart Card Debit Card MCB Visa Credit Card Internship Report on MCB bank Page 14
  • 15.
     MCB INVESTMENTBANKING Project & Structured Finance Syndicated Loans and Debt Capital Markets Quasi Equity/Hybrid Instruments Equity Capital Raising Advisory Services Facility Administration Commercial Banking  MCB CORPORATE FINANCING Working Capital Loans Term Loans Trade Finance Services Cash Management Transaction Banking Division  MCB BANCASSURANCE  MCB’S REMITTANCE  MCB AGRICULTURE PRODUCTS Shadabi Plan Khushali Scheme Tractor Finance Scheme Aabiari Scheme Grower Finance Dairy & Meat Plan Internship Report on MCB bank Page 15
  • 16.
    Murghbani Scheme Baghbani Mahigeri Schemz VIRTUAL BANKING Deposit Schemes Fund Based Facilities Ijarah Products Types of Ijarah  Car Ijarah  Equipment Ijarah Murabahah Musharika Equipment  PRIVILEGE BANKING  OTHER SERVICES MCB MNET MCB Salary Club MCB Lockers MCB SMS Banking MCB Full Day Banking Internship Report on MCB bank Page 16
  • 17.
     SWOT Analysis Thereare two part of SWOT Analysis Internal Analysis External Analysis  Internal Analysis Strengths: The strengths of MCB Bank are the following: 1. MCB is the first Pakistani privatized bank because of its quality management, marketing, innovation in product and services is performing well in financial market. 2. It has created a good reputation in the banking sector. 3. It has 1200+ branches on different places in Pakistan. 4. It has one of the nation’s largest ATM network with more than 500 ATMs covering 110 cities across the country and it is still growing. 5. It provides MCB mobile ATM for convenient world class banking services. Internship Report on MCB bank Page 17
  • 18.
    Weaknesses: 1. Mismanagement oftime is the biggest mistake in MCB branches that the official time of bank closing is 5:30pm but the staff is normally on their seats till 7:00pm to 9:00pm. 2. Due to the lack of advertisement majority of the people are not well aware about the products of MCB. 3. There is lack of specialized skill because of rotation policy of human resource management. 4. Most of the staff and employees are dissatisfied due to low salaries as compared to same position in other banks. 5. It is also seen that the staff complain about over loaded of work. It is the reason that turnover ratio of MCB is increasing. 6. MCB has numbers of employees of the period when the MCB was nationalized bank they cannot perform their duty as like employees in other banks. They always show rude attitude that is not much motivating for new customer. 7. There is lack of skills and training of employees.MCB have to gave attention to improve the skills and abilities of the employees according to modern banking requirements. Internship Report on MCB bank Page 18
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     External Analysis Opportunities: 1. MCBbank can capture big portion of the market by expanding their branches and ATM network to other countries. 2. MCB have to launch some new product or services like tele bank and internet banking etc. 3. Media is powerful tool of communication.MCB have to use it for advertisement of new product and severs provided by MCB bank. By adverting MCB can create more new customers. 4. MCB bank has to start some kind of Social services or for culture benefit. By doing this it can motivate its customer that you are contributing in this services by parching and using MCB services. 5. Now the concept of Islamic banking is increasing in Pakistan. There is opportunities that by creating Islamic branches all over the country and fallow Islamic structure in those branches. It should also creat Islamic product for customers Threats: 1. In Pakistan the banking sector is growing rapidly and it has attracts the business men to enter in banking sector. Some foreign banks have started their business in Pakistan. Now MCB bank has to compete with great effort by giving superior services. 2. From few years Pakistan is facing a lot of problems like energy crisis, rising prices of product. Govt. of Pakistan is borrowing money from State Bank of Pakistan and from commercial banks also and due to lack of money to give to depositor many banks can cause to bankrupt. 3. Foreign banks are increasing in Pakistan 4. Foreign banks are providing attractive and new services to MCB customer. Internship Report on MCB bank Page 19
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     Marketing Strategy MCBbank is using different kind of marketing Strategies to expand their business. MCB bank is using marketing mix strategy for promotion. It is a set of marketing tools which is used to find out the marketing objectives in the target market. These tools are classified into four factors named as 1. Product: MCB bank has started new services and product to satisfy the customers. Different kind of accounts are offered by the MCB bank to attract the customers. Mahana Khushali Plan : It is a five year plan in which amount is deposited for five years and return is given on monthly basis. By this play MCB bank is targeting those people who want to save their money and want some return on their investment. Capital Growth Certificate plan: This plan is offered to target those person that deposit their amount for long period of time. According to this plan your deposited amount will be double after five year. Internship Report on MCB bank Page 20
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    Night - BankingServices: MCB has started these services on busy commercial centre for the ease of their customer. Now traders and other client can deposit their amount in these services centres till 8:00Pm. There are many other products and services that the MCB bank had lunched. By providing such kind of products MCB has attracted the consumers from outside the bank market and core account from competitors. 2. Price: It is a critical marketing tool. It represent that what customer have to pay against services received. It is the only element that creates revenue for MCB bank. Some time pricing strategy is also used to set the price. In the start prices were low but after creating the image MCB bank has raised their charges. There come some objectives in setting the price some of objectives are Maximization of profit, obtaining market share, rate of return on investment etc. 3. Place Place is used in since of distribution channel ,and distribution mean that from where the seller makes his products available to the buyers.MCb bank is using to important channels of distribution. Bank Branches Bank Credit Card Internship Report on MCB bank Page 21
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    Bank branches: Bank branchesare the most important channel of distribution for the bank. Through these branches MCB is easily serving potential customers. The largest portion of business is being generated from these branches. The bank has also started Saturday banking in all big cities with ATN network. Bank Credit Cards: MCB has made the contract with Master Card International and made the ac cess of the card possible at 11 million outlets all over the world. Due to use of this card there is rapidly increase in the usage of banking services. 4. Promotion MCB bank use this tool for different activities. BY using different ways MCB is targeting the customers to use their product or services. MCB Ltd has used this tool to spread information about their services and product. MCB bank is using four basic promotional tools for promotion and those promotion tools are the following. Advertising Personal selling Publicity Sales promotion Internship Report on MCB bank Page 22
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     Competitive Strategy Aftermaking the mix structure of basic elements of marketing the banks focus on growth strategies. Growth strategy is further divided in to four strategies: Market Penetration Strategy Market Development Strategy Product Development Strategy Diversification Strategy 1. Market Penetration Strategy With the help of this strategy the bank management first consider either it could gain more market share or not with its current products in their current markets. 2. Market Development Strategy: In this it considers whether it can find or develop new markets for its current products. 3. Product Development Strategy: Then, it considers whether it can develop new products of impending interest to its current markets.  Diversification Strategy: Finally it will review opportunities to develop new products for new markets. These strategies have been examined further as follows: Internship Report on MCB bank Page 23
  • 24.
    Market penetration: By usingthis strategy MCB bank is increasing its sale with existing product in the existing market by means of increased and more effective positioning and targeting, delivery and promotional activities. Some basic strategies are: Selling present services to new customers Selling more services to present customers Market development: MCB is using this strategy to increase sale in new markets with existing products and services. Product development This strategy is used to introduce the new product or services in the existing market. Diversification It is also growth strategy and it is most difficult growth strategy for bank. In this strategy the bank focuses on to grow new services and new markets. Internship Report on MCB bank Page 24
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     Business processAnalysis Internship Report on MCB bank Page 25
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    Internship Report onMCB bank Page 26
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    Internship Report onMCB bank Page 27
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     Business processAnalysis  HORIZONTAL ANALYSIS OF BALANCE SHEET 2011 2010 2009 100% 100% 100% 2008 100% 2007 100% Assets Cash Due from Banks 100 90.51 90.06 91.32 89.35 Other Assets Total 100 84.88 61.02 51.86 53.86 Net Loans 100 91.23 90.19 78.35 64.32 and 100 99.54 99.16 98.59 98.3 and 93.45 91.35 68.91 81.29 and 100 85.46 71.56 62.46 53.17 100 97.43 88.86 83.67 93.57 (87.25) (68.96) (56.36) (62.77) Land Improvements Building Improvement 100 Furniture Equipment Gross Fixed Assets Accumulated Depreciation (100) Net Fixed Assets 100 100.24 94.79 92.95 99.59 Intangibles 100 23.67 37.07 25.65 29.85 in 100 100 0.00 0.00 0.00 Current 100 87.22 38.44 40.18 0.00 100 83.99 82.35 77.09 66.29 Goodwill (Cost Excess) Other Non Assets Total Assets Liabilities Accounts Payable 0.00 345.92 185.35 0.00 17.49 Accrued Expenses 100 88.66 82.53 75.06 65.19 Long Term Debt 100 123.07 67.96 29.24 36.38 Total Debt 100 74.96 168.94 152.48 45.23 Def. Income Tax Lib. 0.00 0.00 0.00 0.00 509.0 Internship Report on MCB bank Page 28
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    Minority Interest Liabilities 100.52 22.39 22.74 22.14 100 Other Liabilities Total 100 75.02 72.21 76.49 63.19 TotalLiabilities 100 89.10 80.98 70.29 4.59 Common Stock Equity 100 79.99 62.82 53.33 48.48 Retained Earnings 100 95.09 87.79 75.89 65.92 Equity Gains or Losses 100 111.31 109.03 94.52 208.4 Equity Adjustments 100 110.01 110.34 94.26 56.85 100 96.68 89.58 77.12 87.07 and 100 89.99 82.0 71.09 66.29 Stockholders’ Equity Total Equity Total Liabilities Stock Equity  HORIZONTAL ANALYSIS OF INCOME STATEMENT 2011 2010 2009 2008 2007 100% 100% 100% 100% 100% Interest Income Bank 100 92.67 81.64 63.91 53.13 Total Interest Expense 100 93.10 81.31 48.22 35.09 Net Interest Income 100 92.24 81.98 79.02 71.68 Loan Loss Provision 100 106.96 126.31 117.65 50.47 Net Interest Income 100 88.59 70.02 69.45 76.93 Non Interest Income 100 91.88 96.73 84.45 70.57 After Loan Loss Provision Non-Operating Expenses Bank Internship Report on MCB bank Page 29
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    Non Interest Expense(100) (85.94) (75.56) (62.62) (46.3) Bank Pre Tax Income 100 94.28 85.00 89.02 108.9 Income Taxes 100 81.88 48.76 89.98 107.6 100 100.55 102.19 88.53 109.4 Net Income Available 100 100.55 102.19 88.53 109.4 Non-Recurring Events Total Net Income For Common stock  VERTICAL ANALYSIS OF BALANCE SHEET 2011 2010 2009 2008 2007 100% 100% 100% 100% 100% Cash Due from Banks 13.86 14.10 15.37 17.83 17.42 Other Assets Total 30.96 30.58 23.94 22.16 26.07 Net Loans 45.68 46.12 50.24 50.36 44.56 Land and Improvements 1.47 1.63 1.77 2.03 2.69 Building and Improvements 0.004 0.0048 0.049 0.0053 0.0054 Furniture and Equipment 0.008 0.0083 0.0075 0.0074 0.0067 Gross Fixed Assets 2.77 2.96 3.01 3.31 3.9 Accumulated Depreciation (0.006) (0.0055) (0.0051) (0.0048) (0.0057) Net Fixed Assets 2.16 2.41 2.5 2.83 3.33 Intangibles 0.00006 0.000018 0.000031 0.000025 0.000031 Goodwill (Cost in Excess) 0.0004 0.000054 0.00 0.00 0.00 Other Non Current Assets 0.0069 0.0066 0.0032 0.0039 0.00 Total Assets 100 100 100 100 100 Accounts Payable 0.00 0.0003 0.00019 0.00 0.00002 Accrued Expenses 0.0097 0.0096 0.0098 1.03 0.0096 Assets Liabilities Internship Report on MCB bank Page 30
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    Long Term Debt 0.00008 0.00012 0.00004 0.00003 0.00004 TotalDebt 2.31 1.93 4.77 4.96 1.58 Def. Income Tax Lib. 0.00 0.00 0.00 0.00 0.0066 Minority Interest Liabilities 0.0004 0.00047 0.00012 0.00014 0.00014 Other Liabilities Total 2.45 2.04 2.16 2.57 2.33 Total Liabilities 88.27 87.39 87.17 87.27 84.59 Common Stock Equity 1.46 1.29 1.13 1.09 1.06 Retained Earnings 7.72 8.16 8.26 8.2 7.68 Equity Unrealized 1.95 2.42 2.62 2.6 6.15 Equity Adjustments 0.0059 0.0072 0.0079 0.0078 0.0050 Total Equity 11.73 12.6 12.82 12.72 15.4 100 100 100 100 2008 100% 2007 100% Stockholders’ Equity Total Liabilities and Stock 100 Equity  VERTICAL ANALYSIS OF INCOME STATEMENT 2011 100% 2010 100% Interest Income Bank 540.26 498.94 Total Interest Expense (273.92) (253.63) 2009 100% 431.61 (217.93) 389.97 262.16 (152.27) (87.79) Net Interest Income 266.32 244.32 213.67 237.7 174.36 Loan Loss Provision (52.83) (56.20) (65.30) (70.21) (24.35) Net Interest Income 213.50 188.12 148.37 167.49 150.01 101.92 105.57 106.39 71.89 (125.62) (75.19) after Loan Loss Provision Non-Operating Expenses Non Interest Income 111.53 Bank Non Interest Exp. Bank (177.58) Internship Report on MCB bank (151.77) (131.30) Page 31
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    Pre Tax Income 147.45 138.25 122.64 148.26 146.70 IncomeTaxes (47.46) (38.65) (22.65) (48.24) (46.64) Minority Interest 0.000001 0.0039 0.000098 5 (0.00019 (0.00061) ) Non-Recurring Events Total Net Income 100 100 100 100 100 Net Income Available 100 100 100 100 100 For Common Stock Holder Internship Report on MCB bank Page 32
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    Internship Report onMCB bank Page 33
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     Assets ofMCB bank is increased by 15% to Rs. 653 Billion  Deposits is increased to Rs. 491 Billion  Gross advances came down Rs. 248 Billion  Share holder Equity is creased to Rs. 79 Billion  Profit after tax is increased to Rs. 19.4 Billion  Income from dealing in foreign currencies increased by 46%  Return on assets improved from 3.13% in 2010 to 3.18 in 2011.  Earnings per share is increased to Rs. 23.23 in 2011as compared to Rs.20.18 in 2010 Internship Report on MCB bank Page 34
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    Details plan ofmy internship program  Introduction of branch: I have done my six weeks internship from MCB bank limited (1186) Masoom Shah Road Multan under the branch manager Shahid Mahmood. This is a online branch of MCB bank and this branch is doing good business. The question comes in how? Reasons behind this are firstly, when the branch manager joins this branch he brings some account with him. Secondly, this branch is on exact location on the main road and different are around it. Thirdly, the Staff of this branch is much cooperated they work like a time that’s why the working of management is very smooth and efficient. Finally, this branch have very good contact and the relation with the shops business entities and the other sound parties as well to increase the deposit of the branch and maintain the efficiency of the work and enhance the organization. The branch manager Shahid Mahmood introduced me with staff members and guided me about different functions being operated within the organization.  Starting and the ending dates of my internship Starting and the ending dates of my internship program in the MCB bank limited (1186) Masoom Shah Road Multan. Starting Date: September 25, 2012 Ending Date: August 05, 2012 Internship Report on MCB bank Page 35
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     Names ofthe departments where I have worked during my internship duration 1. Account opening department 2. Clearing department 3. Remittances department 1. Account Opening Department I have worked one week in account opening department. It is the most important department of any branch of any bank because all the working of the bank is based on the account. It is the first step between the customer and banks. I opened new accounts some for new customers and some for old customers because they want to operate more than one account. There are different types of accounts in MCB bank limited which are offered to its customers. Different accounts has different benefits different charges different minimum balance requirement and different purposes. There are three types of account. 1. Current account 2. Saving account 3. Term deposit account  Current Account: MCB Bank offers a variety of current accounts to provide to the everyday transactional needs of various customers. These accounts ensure ease and freedom to bank from any of the 1100+ branches across the country. The different accounts include: i. Normal Current Account that has 10,000 rupees minimum balance requirement. Internship Report on MCB bank Page 36
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    ii. Business Account that has 50,000 rupees minimum balance requirement. It isoffering free online transactions, Demand Drafts, Pay Orders and lots more to meet the day to day business requirements iii. Current Life Account which offers the security of life insurance free of cost and for all others, the conventional Current Account. Note: If the balance goes down from the minimum balance required then the bank will be charged Rs.50 as per mint.  Saving Account: MCB Bank 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. i. PLS Saving Account has no minimum balance requirement and it offer profit rate on semi annually balance. ii. Xtra Saving Account is targeted for customers having Rs. 5 million + deposit and it offer profit rate on quarterly balance. iii. 365 Gold Account offers profit rate on daily balance In addition, two unique products: Smart Savings and Savings Maximizer are special saving accounts run solely via debit cards and other remote banking channels, offering a very competitive rate to both high and low end savers.  Term Deposit Account: MCB Term Deposit 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. Internship Report on MCB bank Page 37
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    To open termdeposit account the minimum balance requirement is one lack rupees. Term deposit account can be opened for one month, three month, six month, one year, three year, and five year. The account will be closed after the term then new account will be open on the demand of customer. MCB bank limited is offering some other types of account these are mention below.  Basic Banking Account: MCB bank is offering these services to those people who have low income without any charges. No Zakat is deducted from their balance and there is no profit no loss on this account.  Khushali Bachat Account: It offer profit rate on semi annually balance. For opening of new accounts there are required some documents For individual account Account opening form Attested photocopy of computerize National Identity Card or Passport of individual. In case of salaried person, attested copy of his or her service card or any other acceptable evidence of service, including, but not limited to a certificate from employer. If the person has his or her own business then the letter pad copy is needed. Internship Report on MCB bank Page 38
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    In case ofilliterate person, two receipt passport size photographs of the new account holder besides taking his right and thumb impression on the specimen signature card. For Joint Stock Companies Account Certified copies of Resolution of board of directors for opening of account specifying the person or person’s authorized to operate the company account. Memorandum and Article of Association Certificate of incorporation Certificate of commencement of business Attested photo of Computerized National Identity Card of all Directors. List of Directors in from-29 issued for the Register Joint Stock Companies. For Partnership Account Attested photocopy of computerize National Identity Card Attested copy of “ Partnership Deed” or “letter of Partnership” Attested copy of Registration Certificate with Registrar of the firm. In case of Partnership is unregistered, this fact should be clearly mentioned on the Customer Relationship form. Authority Letter in original, in favor of the person or other person who is authorized by the partners. Account Opening Form is filled and necessary documents are attached with this Form and are sent to main Branch. After verification the main branch send mail of verification then the new is activated. Internship Report on MCB bank Page 39
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    2. Cleaning department Ihave worked two weeks (2nd ad 3th ) in clearing department. I learned the functions and work which are performed by this department. This is the important department of any bank. General banking officer (GPO) Shahid Akhtar Wahla taught me about clearing. He told me that it is a process in which the banker settle their mutual account by claiming the arising account of various instruments presented by one bank drawn on the other bank either the bank is in the same city or out of city. Suppose an NBP account-holder gives a crosscheck for MCB. Similarly, MCB accountholders give check to people having accounts in other banks; these all banks need to clear their overall balances with each other. The clearing department does this. Clearing checks MCB Account-holder X NBP Account-holder Cross check Y NBP Bank MCB Deposited In clearing we deal with the cheques of other banks or other branches of MCB. The clearing is done with the help of NIFT (National Institutional Facilitation Technologies). It is the institute which the state bank has hired for the collection of clearing cheques of each branch and it plays middle man role between each branch with State Bank of Pakistan. He told me that clearing are of two types  Outward clearing  Inward clearing Internship Report on MCB bank Page 40
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     Outward clearing Outward clearing is that the settle of claims of our branch of MCB bank but drawn on other branches of MCB or on other banks .These cheques are deposited by our customer in our MCB branch and then our MCB bank branch present it in out ward clearing. GPO told me that there are three types of out ward clearing. i. Normal clearing ii. Someday clearing iii. Intercity clearing Before starting clearing GPO gave me the first task to record the detail of cheques in the cheque Collection ( CC ) ledger. The detail includes pay account number, cheque number, cheque amount, bank name of which the cheque is. And I wrote the all amount of all cheques on Add list and add it. Two copies were made one original and second carbon copy. I attached add list and all the bank copy of deposit slip which were filled from customer in the CC ledger. GPO appreciated me that your calculation is good. The same task is done either it is Normal, Same day, or intercity clearing. These are the following detail are required in Clearing Register. 1. Serial No. 2. Account no. of the depositor 3. Depositor name 4. Drawer 5. Drawee 6. Cheque No. 7. Amount of the cheque Internship Report on MCB bank Page 41
  • 42.
     Normal clearing Normalclearing is made at afternoon which would be present on next day.Two stamps are stamped one on front of clearing date stamp and one on back manager stamp that payee account will be credited with signature. It deals with in city. Time limit of this type of clearing is two days. Return on paid charges are Rs.300 which are deducted from the depositor account is case of retire of cheque.  Same day clearing Same day is made initial working hours and are presented on the same day. Two stamps are stamped on frount of the cheque and one on back of the cheque. On front side, one stamp of Same day clearing and second stamp of clearing date on which cheque has to present. On back side, manger stamp that payee account will be credited, and manager signature also. Its charges are Rs.350 only charges that are deducted from the account of holder account.  Intercity clearing Where there is State Bank of Pakistan then the clearing is done by NIFT and if not then another institute is worked so CC ( cheque collection ) is made. Three stamps are stamped two on front side and one on back side. On front side one stamp of intercity clearing and other is clearing date on which it has to present. On back side manager stamp that payee account will be credited and manger signature also. Internship Report on MCB bank Page 42
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    Charges for intercityclearing MCB 0.15% of total amount of cheque including 75 rupees posting charges (Minimum charges are 100 rupees) For other banks 0.25% of total amount of cheque. Excise duty 0.16% In paid charges are 500+75posting charges In case of normal clearing, detail information is recorded the detail in ledger. A clearing schedule slip is arranged with the branch code stamp, total amount and number of instruments and add list is also attached with clearing schedule slip then a plastic seal number is required which is written on the seal. After matching the detail of clearing Register with clearing schedule slip all the instruments, add list, outline page are putted in an envelope and packed in NIFT bag and that NIFT bag is closed with that plastic seal. This is to ensure additional safety. When the seal is opened then the bank will not receive that bag., If the seal number on the bag and on the bundle cover does not match in this case it is a suggestion that some sort of changes has been made the strict action are taken by NIFT and the Bank consequently. The procedure is same for same day clearing and intercity clearing.  Inward clearing In inward clearing other banks or other branches of MCB also settle their account by claiming the instruments which are drawn by the other bank customers or other branches of MCB bank. This is inward clearing other banks sent instrument to our branch which are drawn on us. There are few things which are included in inward clearing. Internship Report on MCB bank Page 43
  • 44.
    a. The chequesshould be cross cheques or there should be cross stamp on face side of the cheque. b. Clearing stamp on the front side of the instruments. c. The clearing stamp dated should be of the next working day d. Manger stamp that Payees account is credited on the bake of the instruments and signature on the stamp e. The signature is to be verified before entering into computer and then the cheque is posted and drafted. 3. Remittance Department I have worked two weeks (4th and 5th ) In Remittance Department. We deal with different functions and different instruments in this department. Those instruments and function are: 1. Demand Draft (DD) 2. Pay order ( PO) 3. Online transfer or internal transfer 4. Call Deposit Receipt (CDR) 5. Deposit slip 1. Demand Draft (DD) Demand draft is like an instrument and is issued on the demand of the customer.DD has abominate the extra burden of the currency. It is payable on the demand when the customer want it. It is issued by the one branch of the bank and is payable by another branch of the same bank. Information required for DD Internship Report on MCB bank Page 44
  • 45.
     Beneficiary Details BeneficiaryName Bank or Branch Name and address Purpose of remittance 2. Pay order (PO) PO is the kind of instruments and it is the property of customer. It is used for the payment of admission fee, tender or for payments of dealing. In case of PO the issue bank and paying will be the same but branches may be different in that city. It flows within the city. 3. Online Transfer The amount can be transfer from one account to another account either the account is of that branch or any branch of MCB in any city. If the amount is being transferred through cheque then online charges are Commission Rs.125 Excise duty Rs.020 Total charges Rs.145 If the amount is being transferred through Cash then the charges are different. If the amount is less than Rs. 25000 then Commission Rs.150 Excise duty Rs. 024 Total Charges Rs. 174 If amount exceed from Rs.25000 then the taxes is also applied due to this total charges also changed. Internship Report on MCB bank Page 45
  • 46.
    Information required foronline  Beneficiary Details Beneficiary Name Bank or Branch Name and address Purpose of remittance  Applicant Detail Name or Title off account Account number CNIC or Passport No.(for Non Account Holder) Signature of Applicant 4. Call Deposit Receipt (CDR) It is highly liquefied instrument which can be cashed at any time on the demand of customer. it is used for tender purpose.CDR show that the specific mentioned account is present in between customer and other party with which deal is being done. In this case issue and paying branch is same. 5. Deposit Slip There are two copies of deposit slip one is for bank use and other for customer use. We fill deposit slip in case of cash deposit in account holder account and when any cheques come in the branch. In my last week (6th) of internship period I have collected the information related to my internship. At end of last week Branch manager Shahid Mahnood taken my Internship Report on MCB bank Page 46
  • 47.
    test what Iwere learned from the organization and then fill my evaluation form and gave the internship letter to me. This was the worked that I had learned from MCB bank limited. I have used great effort to learn about banking sector hoped that this effort will provide me opportunities. It is great edge for me in the job market. It gave a lot of confidence that to deal the customers. It will create positive impact on my future. Internship Report on MCB bank Page 47
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    REFFERENCES  http://www.mcb.com.pk/mcb/about_mcb.asp  http://www.mcb.com.pk/psc/accounts/basic_account.asp http://www.mcb.com.pk/mcb/our_values.asp  http://www.mcb.com.pk/mcb/awards_accolades.asp  Annual Report 2011 of MCB bank limitd Internship Report on MCB bank Page 48
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    Internship Report onMCB bank Page 49
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    Internship Report onMCB bank Page 50
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