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Internship Report Mcb

Internship Report Mcb

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Published by Roshni Pak

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Published by: Roshni Pak on Jul 21, 2010
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 Good Banking Getting Better Internship Report
It has not so far been decided as to how the word ¶Bank· originated. Theexplanation of this origin is attributed to the fact that the jews in Lombardy transacted the business of money exchange on banches in the market placeand when the business failed, the people destroyed the Bank. Incidentally,the word ¶bankrupt· is said to have been evolved from this practice. Theopponents of this opinion argue that it was so, then how is that the Italianmoneychangers were never called ¶Banchierei· in the Middle Ages?Other authorities hold the opinion that the word ¶Bank· is derived from theGerman word back which means joined stock fund. Then ¶Back· wasItalianize into ¶Bank·.
Banking in fact is as primitive as human society for eversince man came torealise the importance of money as a medium of exchange. Perhaps it wasthe Babylonians who developed banking system as early as 2000 B.C. It isevident that the Temples of Babylon were used as ¶Banks· because of theprevalent respect and confidence in the clergy.King Hamurabi ( 1728 ² 1686 B.C ), the founder of the Babylonian empire,drew up accede where in he laid down standard rules of procedure forbanking operations by temples and great landlords. He got his codeinscribed on the block of diorite about 8 feet tall, containing about 150paragraphs which deals with nearly all aspects of loans, interest, pledges,guarantees, natural accidents, loss, theft etc. Later on Sumerians,
 Good Banking Getting Better Internship Report
Babylonians, Hitties and Assyrians standardised the values of the goods insilver, copper and bronze.It is not certain as to whom invented money but history recess that king of Lydia castled electrum ingots of identical shapes and of uniform weights with a triple emblem engraved on it as an official guarantee of value in 687B.C. In 1401 a German public bank was framed comprising the operationsof discounting and transferring of money. By the 16th century, some morepublic banks were formed in Venice, Milan, Amsterdam, Hamburg andNuremburg. In order to streamline Banking organisations and techniques,conferences were held in Nuremburg from 1548 to 1551 and it was agreedthat the commercial interest of the time needed a bank with facilities of growth and transfer but it should not be a bank run by private individuals.Ultimately in 1587, a State Bank under the name of banco DI rialto wasformed in Genoa. Later the bank of Amsterdam was also formed in 1609. This Bank had a guarantee by the State and rendered valuable services to theNetherlands traders upto the year 1795.Similarly in 1690, the Bank of Hamburg came into existence in Hamburg  with the business of accepting deposits of fine silver or of foreign money and to run accounts on these deposits. This Bank rendered great service tothe merchants as well as countries it dealt with until 1873, when it wasmerged with the Reich bank. By the year 1700, the bank of England was notonly issuing notes but also conducting accounts for customers. Its directors were conducting the business like that of limited companies. The bank hadthe monopoly of issuing banking notes. Upto 1813 or there about inEngland, the main profit of bank was derived from the circulation of notes.
In 1918 came into being eleven clearing banks of today. The effect of thishistorical development of banking in England has been fairly wide. First,
 Good Banking Getting Better Internship Report
emergence of a small number of large banks with wide network of branches.Second, increase in the popularity of bank accounts and a large-scale use of cheques.In 1946, the labour government nationalised the bank of England andtransferred the existing stock to the nominee of British treasury. In 1955, theBritish Banks made a departure from traditional banking by undertaking hire-purchase finance for companies buying industrial plants and machinery and took interest on hire-purchase finance.
 At the time of independence, there were 631 offices of scheduled banks inPakistan, of which 487 were located in West Pakistan alone.As a new country without resources it was very difficult for Pakistan to run its ownbanking system immediately. Therefore, the expert committeerecommended that the Reserve Bank of India should continue to functionin Pakistan until 30
September 1948, so that problems of time and demandliability, coinage currencies, exchange etc. be settled between India andPakistan. The non-Muslims started transferring their funds and accounts toIndia. By the end of June 1948 the number of officers of scheduled banksin Pakistan declined from 631 to 225. There were 19 foreign banks with thestatus of small branch offices that were engaged solely in export of cropfrom Pakistan, while there were only two Pakistani institutions, Habib Bank of Pakistan and the Australasia Bank. The customers of the bank are notsatisfied with the uncertain condition of banking. Similarly the Reserve Bank of India was not in the favour of Govt. of Pakistan. The Govt. of Pakistandecided to establish a full-fledge central bank. Consequently the Governor-general of Pakistan Quaid-I-Azam inaugurated the State Bank of Pakistanon July 1, 1948. Thus a landmark was made in the history of banking when

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