INTERNSHIP REPORT ON MUSLIM COMMERCIAL BANK

SADAF TALIB HUSSAIN
A report submitted in partial fulfillment of the requirements of the degree of B.COM(HONS)

AT

HAILEY COLLEGER OF COMMERCE, Lahore. Pakistan Sep,2010

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 am also thankful to all my friends and class fellows who helped me and provided me support to complete this hard task.

I like to thank Mr. Zain Ali, Mr. Yasir and Mr. Akram especially as they helped me remarkably for this project.

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Letter of Transmittal
Head of Hailey College of Commerce, Punjab University of Lahore, New campus.

Dear Sir, It is to present you the internship report which is executed at MCB Bank Limited as required by the university as a degree requirement for B.COM(HONS)program.

This report has been prepared in accordance with the guidelines issued by the department. It is the result of my first professional experience. The report is a practical application of whatever I studied as a business graduate of Hailey College Of Commerce Lahore. In this report, I have covered the introduction of MCB, detail of my working and learning in general banking of MCB. I had assisted the manager operation for assignments, but for learning assist incharge of each department.

I have put all the efforts to summarize my knowledge and experience in this report, to make it comprehensive and to meet reader’s expectations.

Sincerely, SADAF TALIB HUSSAIN

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Executive Summary
MCB was incorporated in 1997 and was later privatized by the Government of Pakistan. The Nishat Group bought the majority shares of the bank and so got the rights to control the bank’s operations. Since the privatization of the bank, MCB has implement different policies to make it one of the best banks of Pakistan, which included introducing new products and services and increase its operations by opening new branches in Pakistan. I did my six weeks internship at MCB New Garden Town Lahore, and worked in account opening department, operations department, accounts department, Remmittance, Customer Service department. Some of the work that I did in these departments included collecting cheques, filling account opening forms, activity checking and stop payments and closing of accounts. Although there were no such big problems found in the working of MCB, there were some problems in training of the employees, incentive schemes and product innovation. Some of the recommendations include workshops for employees, job rotation, teams work to find innovative products and scholarship programs for employees. Lastly MCB has seen a rapid growth in its activities by introducing a range of products and services and showing its presence in the country by opening new branches and in future should keep this momentum and always strive to become the best.

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Table of Contents

TOPICS Acknowledgement Letter of Transmittal Executive Summary Introduction
1.1 Introduction 1.2 Background of the study 1.3 Purpose 1.4 Scope 1.5 Methodology 1.6 Summary

PAGE NO. I II III

01 01 01 02 03 04

History and About MCB
2.1 HISTORICAL BACKGROUN 2.2 About MCB 2.4 VISION & MISSION 2.4.1 VALUES OF MCB 2.4.2 Awards and Achievement 2.5 Branches network 2.5.1 Organization Structure (MCB 0187) 05 06 11 12 14 16 18

PRODUCT &SEVICES
3.1 Accounts 3.1.1 CURRENT ACCOUNT 3.1.2 BASIC BANKING ACCOUNT 3.1.3 Smart Dollar Account 3.1.4 Foreign currency Account 3.1.5 SMART SAVINGS ACCOUNT 3.1.6 KHUSHALI BACHAT ACCOUNT 3.1.7 PLS SAVINGS 365 TERM DEPOSIT 3.2.1 SPECIAL RUPEE TERM DEPOSIT (STD) 3.2.2 SPECIAL NOTICE DEPOSIT (SND) Account Opening Documentation Requirement 3.3.1 Individuals Accounts 3.3.2 Partnership Account 3.3.3 Joint Stock Companies 3.3.4 Clubs, Societies and Associations 3.3.5 Minor Accounts: (Age below: 18) 3.3.8 Illiterate / Photo/ Disable Persons Accounts Client/Account Opening Process Steps Classification of Accounts 3.5.1 Dormant Accounts 3.5.2 Inoperative Accounts 51 51 39 40 41 41 43 43 44 35 37 19 19 21 23 24 26 28 30

9.2 Collection of Cheque book by the Customer REMITTANCES 3.4 Call Deposit Receipt DIFFERENCE BETWEEN CDR AND TDR Clearing 3.1 FLOW CHART OF WORKING OF NIFT 3.5.7.1.3 Unclaimed Deposit Account 3.8.4 Intercity Clearing 51 55 59 63 66 67 67 68 69 70 71 71 71 74 77 78 79 79 82 83 .8.9.2.2.8.8.1 Demand Draft 3.8.2 In Ward Clearing 3.8.1 Parties involved in the Demand Draft 3.3 Term Deposit Receipt 3.9.3.7.1 Procedure for Issuance of Cheque books 3.6 Account Closure Overview of cheque 3.1 Characteristics of the Payment Order 3.1.3 OUTWARD CLEARING 3.8.1 NIFT 3.9.8.8.O issuance 3.8.2 Accounting entry for DD issuance 3.1.3 ACCOUNTING ENTRY WHEN PAY 3.3 Accounting entry for DD Payable Branch 3.2 Payment Order 3.9.2 Accounting entries for P.1.2.

2 Types of Lockers 3.10.3 Insurance of Lockers 3.3 Cash Flow Statement 5.1 Horizontal Analysis 4.10.10.2 Vertical Analysis 4.1Balance sheet 5.3 RATIO ANALYSIS Annual Financial statement of MCB 5.4 Statement Of Change In Equity 98 99 100 101 SWOT ANALYSIS CONCLUSIONS RECOMMENDATION SKILLS ACQUIRED GLOSSARY References 102 105 106 108 113 114 .4 Renewal / Expiry of Lockers 86 86 87 87 88 89 89 91 93 Self Experience Financial Analysis of MCB 4.10.Lockers 3.2 Income Statement 5.1 Issuance of License 3.

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It is necessary for me to complete an internship session of about 6 weeks in some manufacturing or service industry relevant to my area of interest and specialization. It also include introduction of organization. scope. As a part of requirement of MBA degree six week internship is necessary for student. 1.2 Introduction Chapter one is about introduction of report.1 Chapter # 1 Introduction 1.2 Background of the study Internship training program during Master in Business administration Program is necessary for the partial fulfillment of the completion of Degree of Master in Business Administration as per HEC ( Hire education commission ) requirement. purpose. This chapter includes background. objectives and methodology of the study. . I choose the Banking field because I have the interest in this sector because my study background is related with this sector. So.

It will help full for me in future. Bank Alfalfa and many others.  Discover where further competence is needed. Ideally.4 Scope This study will facilitate to me regarding the working of Banking sector of Pakistan because most of the teachers during their lectures use the examples of Banks like MCB.  Convert the bookish knowledge into practical life. 1. and  become better acquainted with the types of work settings in which such Competence can be applied. The most important limitation from which the study suffers is the non-availability of information in a manner required for analysis . 1. internship will enable internees to:  Use my knowledge and skills get from the classroom. real-world experience in a work setting.2 1. UBL. National Bank.3 Purpose Internship is the capstone experience that provides me with hands-on.5 Limitation of the Study: T he study is done with the sole purpose of doing the best work but there were certain limitation faced during the internship period. Students should study about the functioning of such Banks.

6 Objectives: I worked as an internee in MCB Timber Market branch. Another important limitation of the study is time and space constraint. The main objectives to study in MCB were:  To get some experience in working with well reputed organization.  To know about the technology utilized in the banks.  To gain knowledge about the professional environment of the bank. 1. Lahore. In the MCB Timber Market Branch fraud was held by chief cashier and operation manager so an Audit Team was there and management was busy in providing information to auditor and sat s claims of customers. .3 and the secrecy of the bank. 1.  To deal and manage with the situation of stress.7 Methodology: There are mainly two methods that are used for the collection of data.

(B) Secondary Data:  Internet is very helpful for me to study more about banking sector of Pakistan. Internship training program during Master in Business administration Program is necessary for the partial fulfillment of the completion of Degree of Master in Business .4  Primary Data  Secondary Data (A) Primary Data:  Observation of functions of Branch operations on the spot.  Annual reports  Journals  Newspapers 1.8 Summary This is the first chapter of the report containing the detail introduction of the report.  Different type of booklets of the Bank.  Observation of different processes of Branch on the spot.

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 inherits a 59 years legacy of trust of its customers and the citizens of Pakistan. objectives and for the preparation of the internship report I required some kind of data. Internship will enable internees to integrate and use knowledge and skills from the classroom. under the Indian Companies Act. VII of 1913 as a limited company. Chapter # 2 History and About MCB 2. 1947. Where the head office is presently located. I used both methods of data collection that are primary sources and secondary sources for that purpose. It was incorporated by the Adamjee Group on July 9.5 Administration. the bank transferred its registered office to Karachi. This study will facilitate me regarding the working of banking sector of Pakistan. In 1956. the bank moved to Dhaka (then the capital of former East Pakistan) from where it commenced business in August 1948. For achieving my purposes.1 HISTORICAL BACKGROUN MCB Bank Limited formerly known as Muslim Commercial Bank Limited MCB Bank is not an overnight success story. Thus. .

1. the Government of Pakistan nationalized MCB following the Banks (Nationalization) Act 1974.1.6 2. MCB was the only bank which was nationalized solely as neither it nor any other bank being merged with it due to its consistent and firm policies and its sound position. 2. one of the most prestigious civil awards of the country. cement and insurance.2 PRIVATIZATION: A wave of economic reforms swept Pakistan in the lattes introducing the Need for privatization of state owned banks and companies. . textile.1 NATIONALIZATION: In January 1974. In recognition of Mr. 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 Government of Pakistan has conferred him with "Sitara-e-Imtiaz". Mian Mohammad Mansha is the Chairman of the group (and also MCB) and has played instrumental role in its success. The group has strong presence in the most important business sectors of the country such as banking. Nishat Group is one of the leading and most diversified business groups in Pakistan. Mansha’s contribution.

the Bank provides 24 hour banking convenience with a network of over 1000 branches. and every time. from branch banking to internet banking and from face to face customer interaction to online accessibility. .2 About MCB: Over the years MCB has developed strong relationships with its customers by understanding their needs and treating them with respect.7 2. the largest ATM network in Pakistan over 450 ATM locations in the market. MCB now focuses on three core businesses namely Corporate. With the quest of quality MCB has always taken initiatives bringing banking into a new arena. The driving force behind its commitment and services is its focus on customers ensuring that it not only meets. first time. dignity and importance. MCB is also catering to the growing middle class by providing new asset and liability products. MCB Bank Limited (Formerly Muslim Commercial Bank Limited) has a solid foundation of over 63 years in Pakistan. Corporate clientele includes public sector companies as well as large local and multi national concerns. from cash to the convenience of plastic. They strive to achieve excellence by ensuring that every moment of their time is spent in adding value. making sure that they do things right. but also exceeds their expectation. Commercial and Consumer Banking.

6635 1.1 Pattern of Share Holdings Description Shareholding Percentage Directors.703 7.0008 0.208.3.0431 .pk 2.2490 0.com.mcb. CEO and children Associated Companies NIT & ICP Banks.057 7.877 57.307 46.5518 8.239.009. Main Mohammad Mansha New Garden Town Lahore.190.8 2. DFI & NBFI Insurance Companies Modarabas & Mutual Funds 52.835 2. 1080 +92-042-7727456 / 7720054 111-000-622 (MCB) www.034 5.052.3 Organization Profile Name of Organization: Chairman: Location: Branch code: Phone: UAN: Website: MCB Limited.3240 6.

General Public (Local) General Public (Foreign) Others Foreign Companies 131.0636 14.375 19.731 101. A team of 10 professionals is handling operational management of the bank. & Corp. Mian Mohammed Mansha is chairman & chief executive of the company with a team of 10 directors and 1 vice chairman to help in the business control and strategy making for the company.400.749.126 44.527 100.663 246.167. The different operational departments are:  Consumer Banking & IT Division .843.9 Public Sector Cos.237. Mian Mohammed Mansha also heads this team.6194 Company Total 691.00 ORGANIZATION STRUCTURE As MCB is a banking company listed in stock exchange therefore it follows all the legalities. MR.4010 35.819 2. which are imposed by concerned statutes. MR.104.7364 0.3473 6.

Tariq Rafi Mr. Muhammad Yaqub Mian Raza Mansha Dato' Mohammed Hussein Mr. M.2 Board of Directors Mian Mohammad Mansha Chairman Mr.10  Financial & Inter Branch Division  Banking Operations Divisions  HRD & Legal Division  Financial Control & Audit Division  Credit Management Division  Commercial Banking Division  Corporate Banking Division 2. Sarmad Amin Dr. Aftab Ahmad Khan Vice Chairman Member Member Member Member Member Member Member . Muneer Mr.3. S. Shahzad Saleem Mr.

11 Mr. Atif Bajwa President / CEO 2. In doing so.4 VISION & MISSION Vision Statement To be the leading financial services provider. providing innovative and efficient financial solutions to create and nurture long-term relationships with our customers. Muhammad Ali Zeb Member Member Member Mr. we ensure that our shareholders can invest with confidence in us.  Providing innovative  Efficient financial solutions  Long-term relationships with our customers  Shareholders invest with confidence . partnering with our customers for a more prosperous and secure future. Abdul Farid Bin Alias Mian Umer Mansha Mr. Mission Statement We are a team of committed professionals.

12 2. We are a performance driven. beliefs.4. culture and history. RESPECT We respect our customer’s values. both realized and unrealized. result oriented organization where merit is the only criterion for reward. We value the equality of gender and diversity of experience and education that our employees bring with them. We deliver on our responsibilities and commitments to our customers as well as our colleagues. We make every effort to exceed customer expectations through superior services and solutions. We thrive on the challenge of understanding their needs and aspirations. We believe in being the best at always doing the right thing. EXCELLENCE We take personal responsibility for our role as leaders in the pursuit of excellence.1 VALUES OF MCB INTEGRITY We are the trustees of public funds and serve our community with integrity. . CUSTOMER CENTRICITY Our customers are at the heart of everything we do. We create an environment where each individual is enabled to succeed.

The Bank has a customer base of approximately 4 million. MCB was nationalized along with all other private sector banks. investment in technology and people. During the last fifteen years. MCB soon earned the reputation of a solid and conservative financial institution managed by expatriate executives. a nationwide distribution network of over 1.500 Billion. . utilizing its extensive branch network. the Bank has concentrated on growth through improving service quality. developing a large and stable deposit base.13 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. Incorporated in 1947. MCB TODAY MCB is one of the leading banks of Pakistan with a deposit base of Rs.000 branches and over 450 ATMs in the market. In 1974. 368 Billion and total assets over Rs.

4.2 Awards and Achievement: Euromoney Awards Best Bank in Asia Award 2008 MCB has been awarded as a Euromoney Award 2008 for the “Best Bank in Asia". Best Bank in Pakistan Award 2006 MCB has yet again received the esteemed Euromoney Award for the “Best Bank in Pakistan”.14 2.  Best Bank in Pakistan Award 2005 . It is the only bank to receive the Euromoney Award for Excellence for the sixth time in the past seven years.

2. The Best Domestic Commercial Bank Award 2004 MCB has a distinction of winning the Asia Money 2004 award for being "The Best Domestic Commercial Bank in Pakistan".5 Branches network (Domestic operation) (Overseas operation) . Asia Money Awards The Best Domestic Commercial Bank Award 2005 MCB Continues to shine as once again Asia Money declares MCB as "The Best Domestic Commercial Bank in Pakistan" for the year 2005.15  Best Bank in Pakistan Award 2004  Best Bank in Pakistan Award 2003  Best Bank in Pakistan Award 2001 Best Domestic Bank Award 2000 MCB was awarded as a Euromoney Award 2000 for the “Best Domestic Bank in Pakistan".

Employee Name Department Permanent/Outsource . Employee No.8.2010 Serial No.16 8 (Branches) 1057 Commercial = 986 Consumers = 44 WBG Islamic = 11 = 11 Sri Lanka = 5 Bahrain = 1 EPZ UAE =1 =1 Sub branches 05 MCB New Garden Town Branch (1080) Detail of staff as on 30.

(OG |||) .ADNAN MIAN AKAAM M IQBAL NIMRA ZIA SADAF ALI IFTIKHAR HUSSAIN SAQIB ALI ABDUL LATIF MUHAMMAD ARSHAD MUHAMMAD JAMSHAID BM BOM GBO FOREX GBO ADVANCES PBA ASSISTANT ASSISTANT CHIEF CASHIER ICO INSURANCE GUARD CSO CSO CASH OFFICER CASH OFFICER GUARD GUARD TEA BOY PERMANENT PERMANENT PERMANENT PERMANENT PERMANENT PERMANENT PERMANENT PERMANENT PERMANENT PERMANENT PERMANENT PERMANENT PERMANENT OUTSOURCE OUTSOURCE OUTSOURCE OUTSOURCE OUTSOURCE OUTSOURCE OUTSOURCE 2.17 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 28394 4645 3982 481 150 1226 17640 28005 26265 27364 29640 29177 32619 15558 20418 21230 32576 32538 25335 SALEEM AMJAD BUTT YASIR JAVAID AKRAM RAZA ATIF MISS AMNA UMMER ALI SAJID &SHAHID SANA UMMER NAZIR AHMAD AMIR ALI M.1 Organization Structure (MCB 0187) Manager (AVP) Operation Manger (OG | ) Advances (OG |||) Forex (OG |||) PBA (OG |||) CSO (Contract) Remittance (Assistant) Current saving dep.5.

Some of the jobs that I performed or assisted in performing or overlooked in the various departments were . Yasir (Operation manager) This section is based on my observation and experience and rotation during my internship at the Timber Market Branch of MCB Limited.18 Cash (Contract) Regional Operational Manager Regional Manager Internal control officer (OG |) Chapter # 3 PRODUCT &SERVICES Mr.

charges will be recovered as per the Schedule of Bank Charges RS. If any customer wishes to receive the account statement other than the half yearly cycle.50  Account opening with Rs.1 Accounts Malik Majid (Personal Banking Advisor) Following are the types of account in MCB 3.1.  Free of cost account statements are dispatched on half yearly basis within one week after the mid-year closing.1 CURRENT ACCOUNT  No restriction on Withdrawals and frequency of transactions  No profit is paid on Current Accounts  Service Charges are recovered as specified in the Schedule of Charges  No Zakat is to be deducted on Current Accounts.1000 .19 3.

2 BASIC BANKING ACCOUNT To provide banking facilities to low income people without the restriction to maintain minimum balance requirement Features  The account is opened with a minimum initial deposit of Rs.1000. 3.1. .50 will deduct Eligibility  Individuals (Single/Joint)  Firms (Sole Proprietor Partnership)  Companies (Public and Private Limited). Trust/ Clubs/ Societies and Associations are eligible to open Current Accounts.20  Minimum maintain balance Rs.  BBA is a Rupee Current Account (non-remunerative account).10000 if less then minimum limit Rs.

All customer initiated transactions over and above this limit will be charged Rs.e. 25 per transaction  All ATM transactions conducted through electronic channels (i.  Each month the account holder is allowed 02 deposits transactions (either cash or clearing) and 02 withdrawals (cash or clearing). Charges for duplicate statement will apply as per Schedule of Bank Charges. Hence the customer is allowed unlimited transactions through these channels.  In case where balance in BBA remains “ZERO” for a continuous 06 month period. Virtual Banking) are exempted of transaction fee. ATM.  ATM cards are issued to all BBA account holders in on-line branches.  ATM transaction charges on balance enquiry / mini statement and on usage of non-MCB ATM’s will apply as per Schedule of Bank Charges. the account will be closed automatically.21  There is no minimum balance requirement. and hence no monthly account maintenance charges apply. Debit Card POS machine.  Statement of account to be mailed as per existing policy of the Bank. Card issuance and annual fee will be recovered as per Schedule of Bank Charges. Eligibility .

00.3 Smart Dollar Account  The minimum amount to be placed under this product is USD 100.  Existing individual account holders can also convert their regular Savings or current account into Basic Banking Account.  Complimentary Pak Rupee account without minimum balance requirement.  Free Lockers Facility  Free of Charge Bank Statement & Smart Cards .1.22  Low income individuals are eligible for opening BBA with single or joint account type.  This facility is not offered to non-individuals 3.

 Preferential rates on consumer loans.23  Discount (Up to 50%) on processing charges of Personal Loans & Car Financing. Companies. KEY POINTS .  Waiver on collection charges for crediting the amount in Foreign Currency.4 Foreign currency Account Enjoy the confidence of operating an international account. Eligibility Individuals (Single & Joint). 3.  No Charges on Standing Instructions.1.  In case of any change in the above features. MCB Foreign Currency Account offers you the option of earning attractive returns on your Foreign Currency Investment. prescribed procedure by RBG will be applicable. Firms. locally.

 Countrywide network of Foreign Currency Branches.  Rate of Return directly linked with international market  Profit paid into your account every six months.24  Open your account in US Dollar.  Cash withdrawal in PKR equivalent  Network of over a thousand branches. UK Pound Sterling.  Unlimited transactions at your branch.  General Inquiry e.  Free Foreign Currency cash deposit and withdrawal facility.  Open for as little as US$ 500 or equivalent.  Foreign Remittances facility available. . and hundreds of online branches. ATM Locations. Product Information etc.g. at convenient locations. or Euro.

25  Financial Services e.g. Account Balance Inquiry, Debit Card, Transaction detail, bill payments etc  Non-financial Services e.g. Internet Banking activation etc.

 Bank Account Statement and Cheque Book Request. Eligibility

Only Individuals (Single and Joint) are eligible to open PLS Savings Accounts.

3.1.5 SMART SAVINGS ACCOUNT

 Offers the opportunity to small and medium sized depositors (individuals only) to earn attractive returns on their deposits. Cash withdrawals takes place only through ATM/POS.

 Individuals can open an account with a minimum initial deposit of Rs. 1,000.

 Profit is calculated on a monthly basis and credited to the account after each calendar quarter

 All ATM transactions conducted through electronic channels (i.e. ATM, Debit Card POS machine, Virtual Banking) are exempted of transaction fees. The customer is allowed unlimited transactions up to available balance in the account through these channels.

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 The profit is calculated only on minimum deposit balance between Rs. 10,000/- and Rs. 300,000/- during a month, irrespective of the balance available in the account (as per prescribed slabs). This range can be changed by the Bank any time without giving prior notice to the customer (as and when required).

 Profit is calculated monthly, based on the minimum balance of the account during the month. In case minimum balance exceeds the ceiling of Rs. 300,000/- in a month, profit would only be paid on Rs. 300,000/-

 MCB Smart Savings account can be merged with the regular PLS Savings account any time by giving 3 months notice to the customers at the discretion of the Bank.

 The profit rates are estimated/provisional and subject to change any time at the discretion of the Bank.

 Service charges would be applicable as per Bank policy if the balance goes down below the prescribed minimum balance.

 Cheque book would not be issued to the account holder. ATM Card would be issued to the customer for cash withdrawals.

27  A customer can open only one MCB Smart Savings Account in the Bank, in case a customer is found to have more than one Smart Savings Account, the Bank reserves the right not to give the profit or recover profit if already paid to the customer on their account/s.

 Zakat is deducted as per the policy. Withholding Tax is also deducted from profit (where applicable) as per Income Tax Laws

Rates Up to RS.199, 999 Rs.200, 000 – 299,999 More than Rs.300, 000 5% 7% 5%

Profit Calculation: Profit will be calculated on a monthly basis, based on the minimum balance maintained by the customer during that month.

Eligibility
 Only Individuals (Single or Joint) are eligible to open PLS Smart Savings Account.

Collection accounts etc are not eligible.  Zakat is deducted as per the Government’s and Zakat Ushr Directives.20. Zakat is not deducted on the accounts of Non.28  Non-Individuals like Proprietors Company.1.Rs. Standing Instructions: .Muslims and where Affidavit is provided. Partnership.6 KHUSHALI BACHAT ACCOUNT Provides additional facilities for payment of Utility Bills and Loan Installment of HBFC through debit of Account (free of charge) with added feature of profit calculation at average daily balance.  Free of cost Account Statement is dispatched on half yearly basis. Trading. 3.  Profit is disbursed /paid on half yearly basis as per the rates notified by the bank.000  Profit provisioning/ accruals are made on Daily Closing Balance of the day. (At designated branches only  Minimum balance requirement as specified in the Schedule of Bank Charges.  Withholding Tax is deducted on Profit as per the Government’s policy.

29 For all Standing Instructions regarding payment of Utility Bills /HBFC Installments.  It is a checking account and there is no restriction on number of withdrawals and deposits transactions.000/.on any day. Branch obtains written request duly signed by the customer.and above.  Account is opened with minimum deposit of Rs. the product will . if balances in the account fall below Rs.300.256A) at the time of opening the account or subsequently whenever desired to avail such facilities.300. Eligibility Only Individuals (Single or Joint) are eligible 3. customer fills out the Standing Instructions Form (SF.300. Conversion of Existing Account to Khushali Bachat Account: Existing PLS Savings Accounts can be converted into Khushali Bachat Account on the request of the customer.000/-  Profit is calculated on daily product basis on the balance of Rs.7 PLS SAVINGS 365 PLS Savings 365 also falls under the category of Savings Deposit Scheme. However.1.000/. Branch verifies the customer’s signature from the record/system and attaches the application with the original Account Opening Form.

365 accounts except Development Financial Institution. Multinational Companies.  Calculation of Profit is made on daily product basis at variable rates according to Deposit Slab Range at declared rates on Half Yearly basis.  All other terms and conditions including rates of profit.30 be considered as well and the profit will be paid as per the rates notified by the Bank on half yearly basis. Eligibility All types of customers are allowed to open PLS. Zakat and Withholding tax applicable to PLS Savings Bank Accounts are applicable.1. Government and Autonomous bodies. 3.  There is no limitation on number of withdrawals and amount of withdrawals.8 PLS SAVINGS 365-Gold Offered to Corporate Groups. .

5% Rs. In case.000 in the account. 500. account holder is not maintaining a minimum deposit of Rs.250 Million to less than Rs. the profit is paid at the prevailing Savings Rate.  All other terms and conditions including rates of profit.000 or more in order to get attractive profits.5% Rs.500 Million 8% . 500. Zakat and Withholding Tax applicable to PLS Savings Bank Accounts are applicable. Rates Less than 10 Million 5% Rs.  Service charges would be applicable as per Bank Policy if the balance goes below the prescribed minimum monthly average balance.50 Million to less than 100 Million 7% Rs.25 Million to less than 50 Million 6.31  The account requires a minimum deposit of Rs.10 Million to less than 25 Million 6% Rs.100 Million to less than 250 Million 7.

32 Rs.1000  Minimum balance maintain limit Rs. the higher your profit.500 Million and above 8. MCB Savings Xtra Account offers you a wide range of attractive profit rates. 3. .1.100000  The higher your balance.25% Eligibility Individuals and institutions can open the account.9 SAVINGS XTRA Grow with MCB Xtra by saving more and earning greater profit. KEY POINTS  Initial balance for account opening required Rs.

1.  3 free withdrawal transactions through the branch every month.  Cash deposit and withdrawal facility at hundreds of branches nationwide.*  Profit calculated on monthly basis.  50% discount on lockers. KEY POINTS .  Unlimited number of ATM withdrawal transactions.  No joining fee on Debit/ ATM Card. and more.  Profit paid into your account semi-annually.5%.10 BUSINESS ACCOUNT MCB Business Account lets you build your business through the accrued savings from discounted transaction fees.33  Now avail attractive rates up to 8. 3.

34  Higher the balance the higher the number of free transactions.

 Open a Business Account with Rs.50, 000 only.

 Unlimited free cash deposit and withdrawal facility at hundreds of branches nationwide.

FREE SERVICES When you maintain average monthly balance of Rs.100, 000 or above

 Demand Drafts/Pay Orders.

 Cancellation for Demand Drafts/Pay Orders.

 Cheque Book.

 International ATM Gold Card.

TERM DEPOSIT

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3.2.1 SPECIAL RUPEE TERM DEPOSIT (STD):

The Special Rupee Term Deposit is governed under the PLS rules, but offers the depositor a stable rate of return for a fixed maturity. It is a mandatory requirement for booking a Term Deposit to have a checking account (Current/Savings) in the Bank.

Product is available in the following tenors:

3 months, 6 months, 1 year, 3 years & 5 years The minimum amount to be placed under this scheme is Rs.1000, 000/- (amounts can be booked in multiples of Rs.1000).

Each tenor is divided into 3 categories based on the deposit amount. • • • Zakat Zakat is deducted as per the rules of Zakat & Ushr Committee (as advised and amended from time to time) Rs.1,000,000 to less than Rs.10,000,000 Rs.10,000,000 to less than Rs.25,000,000 Rs.25,000,000 and above

36 Withholding Tax

Withholding Tax, where applicable shall be deducted from the profit amount, as per Income Tax Laws in force at the time of profit payment. This deposit can be used as a security / collateral and the depositor can avail up to 75% of the principal amount upfront. The depositor also has the option of increasing the financing limit up to 90% of the principal amount, upon obtaining the necessary approvals from the relevant authority. The tenor of the financing facility should be within the maturity date of the deposit.

In case of premature encashment, the depositor will bear the tax expense

Profit payment frequency: Profit on the special TD is paid on the date of maturity of deposit for 3 and 6 months tenor. Deposits booked for 1, 3 and 5 years tenor is paid profit on a quarterly basis. Hence the depositor gets the opportunity of investing for a long term without compromising on cash flows. Payment of profit:  Profit amount will be credited into the depositor’s linked/ specified current or Savings account.

 Cash payment of profit amount will not be allowed.

 Branch is required to maintain maturity date and profit payment dates for each account so that there is no delay in payment of profit to the depositor.

In case rate of profit announced on Special . where applicable will be deducted from the Profit/interest amount.2 SPECIAL NOTICE DEPOSIT (SND) SND is issued for 07 and 30 days. 1000/If a depositor withdraws deposit on a date prior to the date of declaration of profit rates. This. the profit due can be paid at the rate of profit declared for the last half year. (Applicable only on PAK Rupees) Withholding Tax Withholding Tax. Firms and Companies 3. Zakat Zakat will be deducted as per Zakat rules as advised and amended from time to time.37 Eligibility (Existing Account Holders) Individuals. 07 days Notice Deposit: Issued for 07 days only and if encashed before 07 days is not eligible for profit/interest. however.2. shall be a provisional payment with the prior approval of Regional Manager. 30 days Notice Deposit: Issued for 30 days and encashed after seven days is eligible for Profit/Interest payable for 07 Days Notice Deposits. If the rate declared for said half year is more than what was paid to such deposit holders then the difference shall be paid through Payment Order. as per Income Tax Laws in force at the time of profit/interest payment. These deposits are also received in multiple of Rs.

 Minimum retention period is 01 month. Eligibility Existing Account Holders (Individuals.  Free Lockers Facility  Free of Charge Bank Statement & Smart Cards  Discount (Up to 50%) on processing charges of Personal Loans & Car Financing. Deposits booked for 1 year is paid interest on a half yearly basis.3 SMART FOREIGN CURRENCY FIXED DEPOSITS  The minimum amount to be placed under this product is USD $ 10. irrespective of the tenor for which the deposit is booked.000. Firms and Companies) 3.38 Notice Deposit is less.  Preferential rates on consumer loans.  Cash payment of Interest amount is not allowed. . The return on Foreign Currency SND is paid on maturity or as prescribed by the Bank or SBP from time to time.  Interest rates are offered based on the amount of deposit. It will be appropriate if an undertaking from the customer is taken in this respect. In case depositor wishes to encash the deposit before completion of one month.  Interest on the smart foreign currency fixed deposits is paid on the date of maturity of deposit for 3 and 6 months tenor. then customer should pay the difference.2.

subject to provision of the following documents: . Attested photocopy of Computerized National Identity Card (CNIC) or Passport.39 only principal amount will be paid to the customer.1 Individuals Accounts 1.VERISYS 4. In case of a salaried person. the branch will pay interest at the Savings  Rate for the number of days completed. 5. 3.3. attested copy of his/her service card or any other acceptable evidence of service. Specimen Signature Cards and other Documents to be obtained for different types of accounts are as follows: 3. Specimen Signature Card (SF-6). In case of any change in the above features. 3. It is a mandatory requirement to verify the CNIC of the customer before opening the accounts. prescribed procedure by RBG will be applicable. In case CNIC does not contain a photograph. a passport size photograph of the new account holder besides taking left & right thumb impressions on the Account Opening Form & Specimen Signature Card 6. Application for Opening Account (SF-1AA). In case of illiterate person.3 Account Opening Documentation Requirement The details of Account Opening Application. from NADRA Online system. Banks may allow the said customer to open the account. 2. including but not limited to a certificate from the employer. If customer wishes to encash the deposit after one month but before maturity.

3. In case the partnership is unregistered.  A copy of CNIC without photograph duly attested by the same person who has attested the photograph as per above. . Specimen Signature Card (SF-6). 6.40  A copy of the photograph duly attested by gazette officer/Nazim. 3. Application for Opening Account (SF-1AA). if not available) duly signed by all partners of the firm.  Moreover.  A confirmation in writing to the effect that they have no other document bearing their photograph. 5. 2.2 Partnership Account 1. in lieu of the partnership deed. Authority letter in original.3. Attested copy of Registration Certificate with Registrar of Firms. Attested copy of “Partnership Deed” or “Letter of Partnership (CF-13). this fact should be clearly mentioned on the Account Opening Form. in favor of the person authorized to operate on the account of the firm. 4. Attested photocopies of Computerized National Identity Card (CNIC) of all partners. the particulars/CNIC of such persons must be confirmed from NADRA in writing or through its “VERYSES” system.

4 Clubs. 2.3. Societies and Associations Certified copies of: 1. 3. It must be . 4. Memorandum and Articles of Association. Resolution duly passed by the members of Managing Committee in their meeting regarding opening and operation of account in the name of said Society. 3. List of members of the Managing Committee duly certified by the Registrar of Societies. 5. 2. Certificate of Incorporation. 4. Permission of the registration authority for opening of Account in the name of Association as required under section 37 (d) of Co-operative Societies Act.3. Certificate of Commencement of Business. Certificate of Registration issued by the Registrar of Cooperative Societies/ Registration Authority. Resolution of Board of Directors for opening of account specifying the person(s) authorized to operate the company account. 5. Attested photocopies of Computerized National Identity Card (CNIC) of all the directors. 3.41 3. Bye-Laws/ Memorandum and Articles of Association of the Society containing official seal of the Registration Authority. 1925.3 Joint Stock Companies Copies of the following documents duly certified by the authorized officer of the: 1.

Resolution duly passed by the Trustees regarding opening and operation of Account in the Bank in the name of said Trust Deed. 3.6 Trust Accounts 1. Attested photocopy of Computerized National Identity Card (CNIC) of the agent. then the period of his minority extends to the age of 21. 3. .3. 3. Certified copies of Letter of Administration/ Instrument of Trust.42 ensured that the mandate for operation of Account given in the Resolution is not in violation of the provision of Bye-Laws/ Memorandum and Articles of Association.5 Agents Accounts 1.3. Attested copies of CNIC of the authorized officials/ persons. Certified copy of “Power of Attorney” 2. 6. Attested copy of Certificate of Registration 2. Attested copies of CNIC of all the trustees. 4.3. 3.7 Minor Accounts: (Age below: 18) A Minor is a person who has not attained the age of 18 years. if the Court appoints guardian of his/her person or property.

3. 3.3. An account in the name of minor is allowed to open by his guardian. Two Attested Photographs. Title of Account is on the Minor’s Name (As per Form –B) &word “Minor” be added to the Title of Account.43 1. preferably jointly in the name of guardian / Minor or Minors. 4. Attested photocopy of Computerized National Identity Cards (CNIC). Attested copy of Computerized National Identity Card (CNIC) of the Guardian. the particulars of the Guardian will be filled out in the column of “Personal Information”. payable to either or survivor opener of the Account. Attested photocopy of Form-B of Minor. 3. 2. In the Account Opening Application. (One photograph shall be pasted on the Account Opening Form and other will be pasted on Specimen Signature Card. 5.8 Illiterate / Photo/ Disable Persons Accounts 1. Left thumb impression (Right thumb impression in case of female) on the account opening application & Specimen Signature Card (SSC) . 2.

and the relevant account documentation required from the customer depending on the type of account are completed and attached. Customer comes into the branch and requests for opening an account.4 Account opening Client/Account Opening Process Steps 1. Customer: receives the Account Opening Form (AOF) from CSO and submits duly completed AOF and relevant documents to the CSO. 2. CSO: checks that all the fields in the Account Opening Form have been duly filled.  Account Opening Form (AOF)  Specimen Signature Card (SSC)  Account Terms & Conditions acknowledgement  Attested copy of CNIC . 4. Customer Services Officer (CSO): delivers the Account Opening Application along with the terms and Conditions (AT&C) and relevant documents to the customer. 3.44 3.

 Completes and sign off Know Your Customer (KYC)/ Client Profile Form.45  Copy of employment or student Card & other verification documents as required on caseto-case basis. .  Returns the same to the CSO for further processing.  Sign-off and affix stamp on the Account Application. Moreover one signature card will be used to capture per signature of the client (In case of Joint Account Holders use additional signature card). Subsequently takes the form to the Relationship and Operations Manager for Verification and authorization. 6. Relationship/ Branch Manager  Interviews the customer. 5. Operations Manager/ Account Maintenance Officer (AMO): Verifies introducer’s signature from Branch Teller Module > Transactions > Non. Obtain customer’s signatures on the AOF and SS Card (in person).Financial Transactions > Customer Signatory (Screen # BT44).  Forwards AOF & Client Profile Form to Relationship Manager.

Pop-up box will appear on the screen: Input or select appropriate ID Type & insert CNIC number & press OK.  Insert Client Short Name. (Box will close automatically)  Insert Country Code. State.  Input address as written in Account Opening Application.46 7. Country of Risk.  Select Account Executive & Client Type then press F-10 or click save icon available on Tool Bar. separate client numbers will be given to each client.  Input Client full Name. System generates the client number and Pop-up box appear on the screen with the following message: “SUCCESSFULLY OPENED 09 DIGIT CLIENT NO xxxxxxxxx” CSO notes down the client number on the account opening form.  In the next section of the same screen. “S” Staff and/or “V” VIP Account. This is used as the default Title of Account whenever an account is opened. In case of joint account holders. Country of Citizen. insert Client Indicator as “N” Normal.SF-1AA. Customer Services Officer (CSO): Selects SYMBOLS Branch Teller Module > Transaction > Non-Financial Transaction > Client Definition (Screen # BT41) to create a client. .

Zakat deduction is not applicable on Non-Muslims. Input Account Type. Select ZAK as Type.Service Charges PLS  ZAK.  SVC. Client information will be retrieved on the screen: Service Charges: Service Charges TAB shows following two charges attached with the account. ZK as frequency & press enter Next Charge Date by default appears as for the next year. (The above exemption would be applicable only on those accounts where account holders have provided relevant documentary evidence to the branch) Zakat Deduction service charge type (ZAK) is only attached with the accounts where Zakat Declaration Form is not submitted by the customer (Only for Muslims).Zakat Service Charge Service Charges (SVC & SVP) are not link with the exempted accounts.47 Account Opening: Uses SYMBOLS BT Module > Transaction > Non-Financial Transaction > Account Opening > select type of account Current or PLS (Screen # BT42) and for Term Deposit (Screen # BT422). . insert Client Number and press enter.Service Charges Current  SVP.

System generates the account number:  CSO note down Client &/or Account Number on the Account Opening Application and Deposit slip. Customer: Deposit cash in the account & obtains the receipt from the teller and leaves the branch. 8. 9. affix stamp & sign-off the Application/ SS Card. Account Maintenance Officer: Verifies customer data (inserted in BT by CSO) with the Account Opening Application & other relevant documents. Operations Manager: Admits customer’s signature. Note: ZK is the auto frequency type for Zakat Deduction. Step 1. cheque book requisition & ATM Request to the Branch Operations for further processing.  Provides the initial Cash Deposit slip to the customer.  Forwards the Account Opening Form. 2006 than Next Charge date should be 07th November. relevant documents. 2007. AMO scans customer’s signature in the Branch Teller Module (BT) > Transactions > NonFinancial Transactions > Customer Signatory > (Screen # BT45) .48 For example: If account opening date is 07th November.

issuance & dispatch of Thank You Letter to the New Customer and introducers. press enter customer Name will appear on the screen . Input Name of Signatory & Description  System shows message at the bottom “Scanning to SYMBOLS”  Pop-up box appears on the screen and shows message “Loading image”.49 Input or Select Client Number. Step 02 Select Branch Teller Module >> Transactions >> Non-Financial Transactions >> Account Signatory (Screen # BT 44).  Keep Specimen Signature Cards (SSC) in fire proof cabinets. Enter Account number. 10. Central Processing Division (CPD): performs the following functions: .  Popup appear as “Transaction completed: Records applied and saved. press enter and save. Press Ok and then Click “Save icon” or press F10.  Forwards Account Opening Application along with the relevant documents to the Centralized Operations (in a sealed envelop via courier) for insertion of Client information in Kernel Module (Financial Management). Also enclose covering note which contains the total number of forms in the envelope.

 Keep Signature Cards in the Fire Proof Cabinets in a sequential order. Account Details Report & Covering Letter to the branch for their record. if there are any. returns account opening application. Also enclose undelivered Thank You Letters.5.  After three working days. 11. relevant documents.  Keep Account Opening Forms along with the relevant documents in the Fire Proof Cabinets or Vault for record.1 Dormant Accounts Checking accounts are classified as dormant accounts on the following conditions: .50  Selects Kernel Module > Static > Client Information > Client (Screen # FM144) and completes client opening screen # 144 in Kernel Module (Financial Management). 3. copy of Thank You Letter. After verification branch forwards acknowledgement to CPD.5 Classification of Accounts 3.  Dispatches Thank You Letter to the customer and introducer. Operations Manager/ Account Maintenance Officer: Receives account opening applications from CPD counts the total number of forms and tallies the number mentioned on the covering letter.

3.3 Unclaimed Deposit Account If a Current & Savings Accounts remains Inoperative for “08 & 07” years respectively will be classified as Unclaimed Deposit Account. Bank Drafts.5. In addition to this. Government Drafts. remains outstanding for 10 years from the date of issuance will be classified as Unclaimed Accounts. Fixed/Term Deposits etc.  Half yearly profit shall continue to be applied as usual on Savings account only. . Banking Companies Ordinance 1962 under section 31 clearly defines that Banks are required to transfer the Unclaimed Deposits to State Bank of Pakistan (SBP) on the completion of a period of Ten (10) years without any delay.5.51  Current accounts not operated for “6” months and Savings accounts not operated for one year shall be classified as dormant accounts. 3. Payment Orders.2 Inoperative Accounts  Current Accounts not operated for “2” years and Savings accounts not operated for “3” years shall be classified as “Inoperative accounts”  Half yearly profit shall continue to be applied as usual. Mail Transfers.

 No profit/interest is paid on deposits transferred to Unclaimed Accounts.  If on the expiry of the three month’s period no acknowledgement or reply is received from the holder of unclaimed Deposit/Instrument.5. no service charges are deducted. Deposits/Instruments recorded in the name of Minor or Government Department/Agency or Courts of Law are not transferred to SBP.3. the entire funds should be transferred to SBP.  Branches are required to maintain complete record of letters sent tithe holders of Unclaimed Deposits  Branches are also required to send written intimation to the Government Institutions. Agencies.1 Notice to the Holder of Unclaimed Deposits/ Instruments  03 months prior to the completion of Unclaimed Deposits. MT’s or any other financial instruments)  However. 3. Demand Draft.52  All unclaimed deposits including time deposit or any other kind of deposits or financial instrument (Pay in slips. . Similarly. TT. Court of Law and Minors (After acquiring the age of maturity) for the settlement of their deposits/instruments. Payment Orders. branches are required to intimate the account holder in writing via mail on the customer’s address regarding the settlement of their deposits/instruments.

the Bank/DFIs will surrender the equivalent PAK RUPEES to State Bank 3.2 Reporting Of Unclaimed Deposits Branch submits list of unclaimed deposits/ instruments separately for Pak Rupee and in Foreign Currency (FCY) on the Form XI (Annexure.5 Refund Procedure All claims lodged with the Branch about Unclaimed Balances transferred to State Bank of Pakistan (SBP). . should be forwarded to State Bank of Pakistan through Principal Office and after getting Proceeds from State Bank of Pakistan same shall be paid to the Claimant.I-05-B) within thirty days after the close of each calendar year. as and when become unclaimed.4 Retention of Documents Preserve all signature cards and documents indicating the “Signing Authority” and other documents in the dual custody of Operations Manager and Designated Authorized Officer.3.  In case of Frozen FCY deposits / Instruments of 1998.3 Transfer of Unclaimed Accounts to State Bank of Pakistan  The amount of unclaimed PKR and FCY deposits/ instruments is transferred to SBP at the end of each calendar year along with a list of unclaimed deposits/instruments.5.3.3.53 3.5.3.5. 3. 3.5.

 Attested copy of CNIC of the claimant.  Claimant’s address and contact number must be clearly mentioned in the application. Whenever the client wants to close the account. the only responsibility of the bank is to collect the issued cheque book from the customer and to get the constructed application form of account closing completely filled.54 While forwarding any claim for refund.I-05-C.  Copy of Intimation Letter sent to the holder of unclaimed deposit/instrument.  Certificate as per Annexure.6 Account Closure For the purpose of account closing a form has been constructed to aide this process. After that the payment of the entire amount in the account is paid to the client. . branches are required to obtain the following documents:  Original application for refund long with verification of attested signature/thumb impression of the claimant by the Branch Operations Manager or Designated Authorized Officer with the name and stamp. 3.

screen pop-ups “Authorization Required” message. 2. Customer Services Officer.CSO:  Receives account closure application  Confirms Account balance from the Branch Teller Module  Informs account balance and returns the same to the customer. customer's account number.55 1. Customer: Fills out the cheque of the total amount and presents the same to the Teller for encashment. in order to fill out the cheque of the complete amount (Account Balance) Designated Authorized Officer Verifies customer’s signature on Account Closure Application. Chief Teller authorizes/approves the transaction). Customer: Presents duly completed account closure application to the CSO. amount of withdrawal and cheque number etc. currency.  Enters the transaction details i. 4.(If transaction amount exceeds the Teller’s limit.e. 3. . Teller: Verifies the customer’s signature & amount from the system  Selects transaction type "CQWR" (Cheque withdrawal) from List of Values  Debits the entire amount from the customer’s account.

 Forwards the application to the Teller in order to close the account. 5. inserts the transaction details in the system. Teller: After receiving the application from the AMO. CSO: Receives restraint removal application from the customer & forwards the same to the Relationship Manager for signature verification and deletion of restraint from the account in order to close customer’s account.56 Note: In case of any Restraint on the account: Teller informs the customer to submit a written application to the CSO. in order to remove the restraint from the account. Account Maintenance Officer (AMO) Verifies the details and remove restraint from the customer’s account. it will generate the following entries: Branch Teller Module: DR: Customer Account CR: Cash In Vault . 7. 6.

Issuance of Cheque book for Existing Customer Prior to issuance of a new cheque-book. Cheque books are relatively sensitive items hence due care must be exercised while handling them. Mahmood. Customer: Counts the cash and leaves the branch. 8. Overview of cheque (Mr. Remittance) Cheque book is a safe custody instrument. account is not dormant /blocked/ inoperative. Cheque is used for cash withdrawal and making payments. Issuance of Cheque book for New Account Holders MF-80R is used for cheque book issuance to the New Account Holders as well as the exiting customers (In absence of existing cheque book or cheque book requisition slip). .57 Accounting Entry For Account Closure Charges: Dr: Cash In Vault/ Customer’s Account Cr: Miscellaneous Earning (A/c Closure) Counts the cash and deliver the same to the customer. please ensure that the affair of the account is satisfactory in all respect (customer maintaining minimum balance requirement. the relationship activity is within the prescribed norms of banking regulations & the customer’s signatures are verified as per the required practice).

 Branch Manager would approve the list for destruction and sign-off.1 Procedure for Issuance of Cheque books 1. 3. However.7.58 Cheque books should be issued to the account holder or his/her authorized representative at the Bank’s counter if DAO is fully satisfied.  Custodian (Designated Authorized Officer) destroys the books/leaves in the presence of the Branch Manager and obtains his/her signature. customer fills out a cheque book Requisition slip .  The cheque-book custodian (Designated Authorized Officer) records the details of all such cheque books in the Annexure 1. Customer: Visits the branch and presents cheque book requisition slip.09-A. Handling of Undelivered Cheque books All processed cheque books that remain uncollected by the customers for six months from the date of issuance must be destroyed by the branches after the recovery of Cheque book issuance charges and Excise Duty (If any).  Ensure proper notation on cheque-book issuance Report for the books destroyed. (Available in the existing cheque book) In case of new customers or lost requisition slip/Cheque book. in exceptional cases the Operations Manager may allow issuance/ dispatch of cheque book to the customers through courier after completing all the relevant formalities.

Input USER)  Receives Requisition Slip. if account has dormant or inoperative status. and Inoperative). press enter. CSO: receives requisition slip from the customer.BT.  Sign-off and affix stamp “Signature Verified” stamp on the requisition slip. Designated Authorized Officer/ Account Maintenance Officer (AMO)  Verifies customers signature through Branch Teller Module >  Input account number. CSO request the customer to perform a financial transaction on the cash counter in order to activate the account & process cheque book issuance request. Also confirm the status of account (Active.  Returns requisition slip to CSO for further processing. 4.59 2. 3.  In case of dormant or inoperative account. Dormant.  CSO Forwards cheque book requisition slip to Designated Authorized Officer to verify customer’s signature from the Branch Teller module. account information & signature appears on the screen. Customer Services Officer (CSO.  Confirms Account balance from the Branch Teller Module >. .  System does not permit the processor to submit the cheque book request by disabling the “SUBMIT” icon on the screen.

.60  Log in to Cheque book Registration System (CBR).  Click on customer’s Name link. Click on submit icon. Central Processing Division (CPD)  Inserts USERID & Password and submit. (At the bottom of the screen all the Cheque Book Request that are linked to the customer’s account are shown along with their status). Input “Number of Leaves” as requested by the customer. 6.  Check details with the Requisition Slips and select Application Status as “Accepted”  Click on “SUBMIT” ICON.  Click on submit icon. system saves the cheque book request with the “New” status. 5.  Input Account Number & click on submit icon. Designated Authorized Officer/ Account Maintenance Officer (Approver)  Approver inserts Login ID and password in the Cheque book Request System in order to approve the cheque book requests.  Keep Cheque book Requisition Slips in the Fire Proof Cabinets under Dual Control. Cheque book Request Details will appear on the screen.  Next screen shows the customer’s account details.  Click to the option “Proceed” available on the above screen. Approver ensures that all the above fields are properly filled by the Input user and approve the Cheque Book Request accordingly.

Central Processing Division (CPD)  Receives Text File from Printer and updates the cheque series in the system. NIFT: Forwards Text file to Printer for marking “Magnetic Ink Character Recognition” (MICR) & Account Details (Number & Title of Account) 8.  Forwards the details (Via e-mail.61  Main Menu Bar screen appears. clicks on Print Cheque book Tab on the top Menu Bar. . 7.  Screen will show the details and total number of request received from all the SYMBOLS Branches.  After uploading the series in the system. Printer:  Receives cheque book requisition slips from the NIFT for marking MICR codes.  After one working day.  Details of the Cheque book Request automatically upload in the text file.Text file) of the printed cheque books to the CPD for verification and for uploading the cheque series in the CBR system 9.  Forwards Text File to NIFT via e-mail.  Click on “Print” Icon & system gives following message “The Cheque book Request has been set to Printed”. “Printed” status automatically changed into “Received”. delivers the same to the respective branches along with the covering schedule.

 Notes down cheque series on the Cheque book requisition slip on which customer’s signature is already verified.CSO: . 3. Match the total number of cheque books received in day with system generated report. Customer Services Officer . 2. 11. Note down the receipt date on the right corner of the cheque book.2 Collection of Cheque book by the Customer 1.  Mark received on the cheque book covering Schedule (report) and sign off the same.  Keeps the cheque books in the safe custody under dual control. CSO (Customer Service Officer) Daily generates Cheque book Issuance Report and maintain in a box file.  Attach requisition slips with the respective cheque books.  Designated Authorized Officer daily delivers the cheque book Box to CSO for onward delivery to the customers.7. Customer: Visits the branch to collect his/her cheque book. (Strong Room or Fire Proof Cabinets). Designated Authorized Officer  Receives processed cheque books from Printer along with the covering schedule.62 10.

63  Retrieves the cheque book from the box. system shows the End Cheque Number. System automatically debit customer’s account and credit Income Head (Miscellaneous Earning). 4.  Detach requisition slip from the cheque book.  Input Start Cheque Number.  Obtains Customer’s signature on the cheque book requisition slip & Issuance Report.BT >> Transactions >> Non-Financial Transactions >> Cheque book Issuance (BT. press enters.  Input appropriate Size Type e.  Attach Cheque book series with the account by using Branch Teller.  Delivers the cheque book to the customer. Customer: Collects cheque book and leaves the branch.47)  Input or Select Account Number.g. 3. “S” Small  System will show Number of Leaves.  Press F10 or Click on save icon available on the tool bar. . Customer Services Officer (CSO) After obtaining the acknowledgement (Signature). Ensures that the signatures are duly verified.

Click on View Request option available on Tool Bar.(Account No. CSO click on Customer’s Name & verifies the cheque series and changes the status into “Delivered” After performing the above task. Designated Authorized Officer: Generates Daily Cheque Issuance Listing Report from MCB Reports and verify the details from the entire requisition slip issued in a day.64 Auto Account Entry: Dr: Customer’s Account (CBIC) Cr: Miscellaneous Earning. At end of Day. . cheque book details report displays on screen.) Cr: Stamp Duty (If any) CSO enters Login ID & Password in CBR system in order to change the “Received” Status to “Delivered”. Forwards all the requisition slips to the Designated Authorized Officer for the validation of Daily Cheque Issuance Listing Report for the day. 5. returns all the undelivered cheque books to Designated Authorized Officer for stock balancing. system shows the message “The Application Status has been set to Delivered”.

or upon other Bank to pay a certain sum of money to or to the order of a specified person.8 REMITTANCES This covers the services and products that Bank offers to its customers for Funds Transfer.  Drawn by one branch of a Bank upon another branch of the same Bank.  Payment Order  Demand Draft (Local & Foreign Currency)  Telegraphic Transfer (Local & Foreign Currency)  Mail Transfer (Local Currency) Note: But here now a day the time of online transfer so TT (Telegraphic Transfer ) and MT( Mail Transfer) not in practically use because people like online quick and safe transfer of amount even DD ( Demand Draft ) and PO ( Pay Order ) use for documentary prove 3.8. 3. It is issued by one branch of a bank and payable by another branch of the same bank or another bank .65 There is a report available in SYMBOLS that provides details of the entire cheque books issued to all the account holders in the branch since the account opening date. Currently Bank is offering following Products & Services for Fund Transfer: (Locally & Internationally).1 Demand Draft Features  Demand Draft is a written order.

66  Demand Draft is a negotiable instrument.1 Parties involved in the Demand Draft 1.1.  Legal provisions as to crossing. collection and payment in due course are similar to those as for cheques and other negotiable instruments. Drawee Branch: Is the Branch on which a draft is drawn. Issuing or Drawing Branch: The Branch which issues a Draft on another Branch.  Thumb impression is not to be accepted on Funds Transfer Application except in cases where purchaser is maintaining an account with the issuing branch.  Demand Draft is neither issued payable to bearer nor drawn on branches situated within the same city.  It is to be ensured that the purchaser of Demand Draft is able to at least sign his name. 2. Payee / Beneficiary . company or local authority. Purchaser: Is the person. 4.8. firm. endorsement. A person unable to sign and not having an account may be advised to apply for the DD person to sign on his behalf. 3. through a literate 3.

3 Accounting entry for DD Payable Branch.2 Accounting entry for DD issuance DEBIT PARTY ACCOUNT CREDIT HO (specific branch of MCB on which DD issued) 3.67 Remitter Draft Beneficiary Fund received Draft Issuing Branch Advice Drawee Branch 3.1.8. DEBIT HO (Specific branch by which DD issued) CREDIT DD PAYABLE .8.1.

. A Crossed DD cannot be paid in cash. A complete procedure for collection / payment has been explained in the section of Cash and Counter Services (Inward Clearing Revalidation of Demand Draft Since DD is payable within six months from the date of its issue. As such. Payment of Demand Draft in Transfer/ Clearing Payment of Demand Drafts can also be made in Transfer/ Clearing. identification of a payee is required. therefore. his signature can be verified from the specimen signatures on the record. an instrument being older than six months requires revalidation before payment. If a payee is the customer of a branch. a crossed DD cannot be presented by the Payee for Cash payment at the counter.68 Once the DD present to the branch then the following entry will pass DEBIT DD PAYABLE CREDIT PARTY ACCOUT CREDIT Payment of Demand Draft via Cash When Demand Draft is presented at the counter of a Drawee branch for cash payment. except to a banker who collects the same for credit to his customer’s account.

of 3.8.  Particulars of the DD should be compared with those given in the RSBS or Branch Teller Module. A rubber stamp reading “Revalidated on --------” should be affixed on the DD under signature two authorized officers of the branch with IBS or AS Numbers. made in a cheque form issued and payable by the bank. to the person named and addressed therein on his giving a proper discharge thereon”.  DD should be presented to the Issuing branch. FEATURES  It is issued by and drawn upon and payable by the same branch of the bank  It is neither transferable nor negotiable and as such it is payable to the payee named therein .2 Payment Order Payment Order is used for making payments within a city. Literal definition of Payment Order is as follows: “A Pay Order is a written authorization for payment.69 Following procedure will be used:  The signature on such letter should be duly verified.

2. . the payee must be named or otherwise indicated therein with reasonable certainly. Government/Semi Government Organization or local authority. Parties involved in the Pay Order Purchaser: Purchaser is a person. company. payment is to be made.8.  Pay Order is issued for payments within the same city 3. Where a bill is not payable to bearer. firm.70  It is in a receipt from and therefore is payable only after obtaining a discharge of the payee on adequate revenue stamp  Pay Order cannot be issued to a minor  Pay Order meant for bank’s own payment but in practice these are also issued to customers for making payment. or to whose order. Issuing/Paying Branch: These issues/pays on presentation of the instrument. Payee: Payee is the person named on a bill to whom.1 Characteristics of the Payment Order  It is issued by and drawn upon and payable by the same branch of the Bank.  It is neither transferable nor negotiable and as such it is payable to the payee named therein.

so when we talk about some specific time period it may be three months.2 Accounting entries for P.8. six months three years etc basically it depends open on customer according to his desire I made this Term deposit receipt. and it is also use for transfer purpose. in term deposit receipt specific time period is mentioned and during this particular period no one can withdraw this amount from his account.3 ACCOUNTING ENTRY WHEN PAY DEBIT: PAY ORDER CREDIT: PARTY 3. because customer deposits his money for specific period of time and on behalf of this bank will pay some percentage of profit which depends upon the amount of deposit higher the deposit higher will be the percentage of profit.8.O issuance DEBIT: PARTY OR CASH CREDIT: PAY ORDER ISSUANCE 3. Basically TDR is profit oriented instrument so that’s why zakat is also applicable on it. no commission is charged on this term deposit receipt. .2.71 3. which means amount moves from one account to another account.8.2.3 Term Deposit Receipt Term Deposit Receipt is basically used for the saving purpose. Term Deposit Receipt is basically a profit oriented instrument.

The client can also made his TDR by depositing cash but his account must be opened in our branch which is necessary because TDR payment is made only through account no counter payment is made on behalf of this TDR.1 Procedure of Issuance of Term Deposit Receipt First of all receive the request letter from customer on (S.3.  Taking all this information in to the TDR register that is TDR  Serial number 58/15  Customer name  Account number  Issued date  Expiry of this TDR  Deposit Receipt which is TDR block Number .  Date of issued TDR  Received from  On Account of  Amount in wards and Amount in Figures  Than send this TDR for signature one from the Accountant and one from the Manager.72 3. Fills the TDR block and write down the complete information on it.F 265) Also receive the cheque which is transfer from cheque to TDR.8.

2 Payment Procedure of Term Deposit Receipt The payment procedure of TDR is only made through account no counter payment is made for this Term Deposit Receipt.3. which means that customer is agree with rules and regulation. and if the customer is not tick this option than he again gives us the request letter on which he wants to extend this time period of TDR.8.8. in this form one option is given and the option is Rollover the Same Tenure If the customer tick this option while filling this form than automatically the renewal of TDR is happened no need for any customer request. 3. for this purpose he will also come to the branch with original TDR and change the date which is mentioned on this TDR.F 265 which is TDR application form.73 Renewal of Term Deposit Receipt When the customer fills the S.3. Customer transfer this TDR at the expiry of this TDR in to his own account and than present a cheque and mention the required amount which he wants to withdraw. 3.3 Deduction of Zakat Thereon .

5%.74 Because TDR is profit oriented instrument so that’s why zakat is applicable on it.2% withholding tax of the amount which is withdrawal over RS.4 Call Deposit Receipt CDR is just like a hard cash.3. So this is the simple rule of Zakat deduction 3. but in now a days when the government of Pakistan impose .in a day 3. basically CDR is used for transfer purpose means amount transfer from one account to another account.8.8.4.4 Voucher in Sheet of TDR Dr Cheque TO CR Term Deposit Receipt(General) 3. CDR is used for Bidding purpose or some time government introduces different housing scheme and here he mentioned that you must submit the CDR instead if net cash.25000/. stale cheque or not and also check the sign verification of this customer which is mentioned on this cheque and compare with signature card which is scanned in computer. now the percentage of zakat which is deducted form the whole amount which is available in his account is 2.1 Issuance of Call Deposit Receipt Receive the request letter from customer and also receive the cheque and verify this cheque weather this post dated.8. .

account number his contact number at the back side of the copy which we kept as record  Paste stamps on this cheque that is Branch crossing stamp  Transfer stamp on this cheque Charges of CDR Bank charge Rupees 50/. 58/07  Than take the signature.2 Enter these vouchers into Transfer sheet Debit Cheque TO Credit CDR .75 Than send this cheque for posting here and see that is it enough amount in his account which he written down on this cheque.8. if yes than further processing. Fills the CDR block and write down the following information on it  Issue date of this CDR  In favor of  On account of  Amount in wards  Amount in figures  CDR serial number i.per CDR 3.4.e.

e. This register uses to write down the following things  Date of Deposit  Deposit number i. 58/10  Deposit Receipt i. and this commission is deducted from his account the customer may this commission charger through cash or I can charge from his account Debit Account TO Credit MISE Earning (General) 3. Payment procedure of Call Deposit Receipt .4.e.76 Also made commission voucher.3 Maintenance of Records of CDR For the purpose of maintenance of CDR record I used the CDR register. 770012  Depositor name  Account number  Due Date (At Call) At Call means that the bank will provide the same amount to the customer who made this CDR at any time.8.

3.8.9 Clearing “Fund transfer between two banks and branches is called clearing” There are two types of clearing  Outward clearing  Inward clearing .4 DIFFERENCE BETWEEN CDR AND TDR: CDR VS TDR Non interest bearing instrument instrument Demand at Call period No Zakat is deducted Use for Transfer Purpose Charges on CDR Interest bearing Demand after the specific Zakat is deducted Use for saving Purpose No Charges on TDR 3.77 The customer whose name. Basically CDR is mostly used for transfer purpose that’s why his payment is made only through account.4. account number is mentioned on this CDR he is only person who can take this amount through his account not in counter payment.

. 3. To understand the process of clearing we first need to understand and comprehend the workings and the purpose of the state banks institution called NIFT. No condition will impose in normal clearing like same day clearing. Inter city clearing Clearing between two cities is called intercity clearing.78 Outward clearing “Outward clearing is to send the cheques to other branch” There are three types of outward clearing 1. Normal clearing In normal clearing send the cheque today and receive the payment next day. In inter city clearing cheque will clear in two or three days. Same day clearing 2. Same day clearing In same day clearing send the cheque in the morning and receive the payment in the evening. Inter city clearing 1. There are two conditions in the same day clearing • • Cheque will be 500000 or above Member of the same day 2. Normal clearing 3.

1 NIFT (NATIONAL INSTITUTIONAL OF FACILITATION TECHNOLOGY) In the process of clearing NIFT plays a very important role. 3. This way NIFT delivers all the cheques to their parent branch from which they have been issued.9.9.1. At the SBP first the NIFT forms a list of all the cheques from all the banks and then forwards it to the SBP representative. NIFT (national institutional facilitation technology) has a very vital role as it is the “middle man” in the purpose of clearing and issuances of cheque books to the customer on demand of the bank or branch. Then these sorted cheques are again given to the NIFT agent and he then takes them to the head offices of their respective banks and from there they are distributed to the respective branches also through NIFT.1 FLOW CHART OF WORKING OF NIFT . This institution has been formed by the State Bank of Pakistan and it performs the duties of receiving all the clearing cheques from all the branches of all the banks and taking them to the state bank. That person categorizes all these cheques according to their respective banks and branches and forms another list of his own.79 3.

and charge RS 200/. after posting all these instruments then he again give me the instruments and I enter all these instruments into the clearing sheet in his Debit side.F 16) in which the details of objections are given that for purpose we return this instrument.2 In Ward Clearing In the morning time I am received the in ward clearing from the NIFT employee and then I count the instruments which I received and match with the summery which is also attached with these instruments. Than give these instruments to the computer operator who posts these instruments. Memo on Cheques Return Also prepare the Memo on (S.80 3.per instrument Calculate the Difference Vouchers of Clearing .9.

P means Return Un Paid. So this the complete process of Clearing.9. 3. Means those cheques which our branch is returned and those cheques which other banks returned our cheques which we send for clearing and it had been rejected  If liabilities are outstanding on our side than made Credit voucher  If liabilities are outstanding are on there side than made Debit Voucher Than finally enter all these difference vouchers in to the clearing sheet and balancing with the computer.  If liabilities are outstanding on our side than made Credit voucher  If liabilities are outstanding are on there side than made Debit Voucher Calculate the Difference Vouchers of Clearing Return I have also made the difference voucher of those cheques which are R.2.U. If the liabilities are outstanding on our side which means that our branch will pay this difference amount than I will prepare the H-O Credit Voucher.1 FLOWCHART OF INWARD CLEARING . and if the Liabilities are outstanding on there side which means that now we are receiving the difference amount so I will prepare the HO Debit Voucher.81 Difference voucher means the difference between the Out ward Clearing and In Ward Clearing.

the A/C Of customer and Cr.82 Customer Gives cheque Of MCB to Other party CHQ holder Goes where he has his own A/C At evening Bank send That CHQ to Bank keeps CHQ and Makes Transaction NIFT send MCB CHQ next Morning to that Branch whose Name is mention On CHQ MCB receives CHQ and checks The following Things NIFT transfer Amount to the Drawer bank Their own branch instrument Date of instrument Date of clearing Over writing Amount in figures Amounts in words MCB Dr. A/C of NIFT .

 Paste the Cross Stamp and clearing stamp at the front of these instruments Face.9. All the cheques deposited in one day of other banks are then again sent through the NIFT to the SBP which sends them to the head offices of their respective banks which through NIFT sends the instruments to the respective branches from which they were issued.3 OUTWARD CLEARING When the account holder of our bank receives payment from any other party in the form of cheque. This process of outward clearing is exactly opposite to the process of inward clearing which I explained in detail before. and our account holder deposits it in his MCB account then that cheque has to pass from the process of outward clearing.  Giving the receiving slip to the customers.83 3. and that cheque is not of our bank or branch.  Separate these instruments with in city clearing wise and inter city wise. 3. This process of outward clearing is also of three days.  Write Down the detail of these entire instruments which I received from customer in to the Clearing Register. .  Paste the Payees Account Credited stamp at the back of these instruments.9.3.1 Procedure of Out Ward Clearing First of all receive the instrument from different customers which they present on our branch.

Than the third copy of delivery summery along with deposit slips keeps in our custody. . because before this action if any instrument which is belong to out of city.9. 3. Now in most of the big cities inter city Clearing performing his job instead of CC. and then enter all these vouchers in to the clearing sheet in his Credit side so this is the complete procedure of out ward clearing.4 Intercity Clearing There is the new concept of clearing which is named as inter city clearing. with the help of inter city clearing time duration is definitely minimum. State Bank of Pakistan now revises his policies and introduces this concept. Under cheque collection procedure it took five to six days which time taking even though the CC procedure is not yet finished but minimum up to the certain extent.84  Calculate the amount of all these instruments  Prepare the delivery summery report  Prepare the Clearing Bundle Cover  Also prepare the Add List After each and every thing is completed now put all these instruments into the NIFT bag and closed this bag with seal. so in order to clear this instrument we sent this cheque through CC Cheque Collection.

 Separate these instruments inter city clearing wise.85 Facility of Inter City Clearing is now offer in these cities  Karachi  Lahore  Mulatn  Gujranwala  Rawalpindi  D.G Khan  Hyderabad  Islamabad  Sialkot  Bahawalpur  Quetta  Peshawar 3.4.1 Procedure of Intercity Clearing  First of all receive the instrument from different customers which they present on our branch.  Write Down the detail of these entire instruments which I received from customer in to the inter city Clearing Register.  Giving the receiving slip to the customers.9. .

per instrument.86  Paste the Cross Stamp. And also made the commission voucher that is account Debit and Mise Earning is Credit .  Paste the Payees Account Credited stamp at the back of these instruments. Than the third copy of delivery summery along with deposit slips keeps in our custody city wise. clearing stamp and inter city stamp at the front of these instruments face. But inter city payment procedure is different I can not credit the particular account until or unless I am receive the NILL value voucher through NIFT.  Calculate the amount of all these instruments  Prepare the delivery summery report for each city  Prepare the Clearing Bundle Cover for each city After each and every thing is completed now put all these instruments city wise into the separate envelope of every city and all these envelopes put in to the NIFT bag and closed this bag with seal. When I receive the NILL value voucher then enter these vouchers into the clearing sheet Dr H-O To Cr A /C Also charge the commission on inter city Clearing which is RS 200/. and also receive the summery from NIFT about all these instruments which I am sent separately into different cities.

The branch who wants to get licence he must sent a written request letter to State Bank than the state bank officer visit this branch and see that is there enough place to provide the licence of lockers to this branch or not? If they are satisfy they charge the licence fee from this branch. with out his permission no body can provide this facility to the customers. 3.2000) .10.2000) Medium Size (Rent RS 2200 per Annum) 16% FED Rs.10. for this purpose the bank should get permission from State Bank of Pakistan who is the banker’s bank. gold and important documents so now the people are very much relax because now they use this facility quite frequently.87 Dr A /C TO Cr Mise Earning (General) 3.224 (Key Security Rs.1 Issuance of License It is not an easy task to get the licence of opening the locker facility in the branch for every bank.2 Types of Lockers Small Size (Rent RS 1400 per Annum) 16% FED Rs.10 Lockers Basically it is a facility which is provided by the bank to its customers in order to secure there money gold important property documents etc.352 (Key Security Rs. before this locker concept people are very much worried about the lose of there money. 3.

4 Renewal / Expiry of Lockers Usually the time period of this facility is one year.88 Large Size (Rent RS 3500 per Annum) 16% FED Rs. at the end of the time period the bank will ask to the client that weather he will continue this facility or not if the customer says yes then he will pay the charges again in order to use this facility which is provided by the bank.3 Insurance of Lockers Bank will also pay the insurance on behalf of this lockers so in case of any bank misshape then the insurance company will accept the certain claim but it depends open the size of the lockers Small Size Locker Claim up to RS 500.10. and the locker is opened with both keys. The authorized person who keeps keys He/She note following things  Customer name  Signatures of customers  Time of lockers operating  Account number .2500) 3.000/- 3.000/Medium Size Locker Claim up to RS 10.10. 00. Procedure of Use of Lockers One key is given to the customer and the other key is handed over to any bank person who is the authorized person. 00.560 (Key Security Rs.000/Large Size Locker Claim up to RS 15.

Chapter # 3 Self Experience  Dressing (Suiting)  Regularity  Punctuality  Account Opening  Account Closing  Account activation  Stop Payment  Interaction with peoples & professional  Issuance of Cheque Book  Remittance  Clearing  Counter services  Symbols software  Facing stress environment .89  Leaving time Customers can use this locker during the banking hour that is 9: Am to 5: PM.

051.155 9.597.017 21.842 55.054.156 172.973 35.406.081.838 1.831 292.675 10.750 45.162 11.530.722.683.066 479.463.638 5.485.239.929 40.519 1.662.276 24.960.282.372 113.883 3.598 16.232 1.263.800 63.130.486.426 5.679 23.031.314 5.156 48% 65% 13% -70% 5% 18% 35% 15% 38% -7% 27% 39.243 Liabilities Bills payable Borrowings Deposits and Other accounts Sub-ordinated loans Deffered tax liabilities Other liabilities Net assets Represented by: Share capital Reserves Unappropriateed profit 7.123 17.373 11.024.943.493 355.496 301.450 342.656.768 34.761 410.479.675 6.119.180.414.577.058 39.976 6.868.461.098.000.089.1 Horizontal Analysis Muslim Commercial Bank Limited Balance Sheet As on 31st December 2008 2009 Assets Cash and balances with treasury banks Balances with other banks Lending to financial intuitions Investments Advances Operating fixed assets Deferred tax assets Other assets 32.465.108.844.807.171.476 257.90 Chapter # 4 Financial Analysis of MCB 4.316 198.261 218.365.517 22% -42% -95% 78% 10% 77% -100% 62% 20% (2009-2008)/2008 .089.440 11.

519 55.105 563.844.592 11.670 5.500.235 811.061 4. commission and brokerage income Dividend income Income from dealing in foreign currencies Gain on investment Unrealized gain/ loss on revaluation of investment Other income Total non mark up interest income Income after interest income Non mark up/interest expense Administrative expenses Other proposition/write off Other charges Total non mark up/ interest expense Profit before taxation 6.91 Surplus on revaluation of assets 5.708 6.505 4.416 -3.035 -23% -133% 710% -15% 15% 2.010 605.187.711 18.705.865.408 1.865 -13.801 692.675 87% 35% Muslim Commercial Bank Limited Profit and Loss Account As on 31st December 2008 Markup/ return/ interest earned Mark up/ return/ interest expense Net mark up/ interest income Provision for dimininution H52in the value of investment Provision against loans and advances Bad debts written off directly Net mark up/interest income after provisions Non mark up/interest income Fee.482.865 570.583 199 20.610 632.308.000 20.634.921.269 2.119.411 66.062 (20092008)/2008 23% 74% 13% 121.267 21.381 2.011.965 105.991.314 9.959.594 5.500.359 21.559.213 6.743 540.540 47.778.311.252.022.867.533 23.014.300 693.856.291 26.702 2009 31.595 7.197 1.416 25.011 -13% 192% -100% 4% .069.560.639 40.786.061.525.302 14% -22% 0% 148% -1% 20% 7% 25.

517 72.022.164.261 218.031.294.9% 2.831 292.098.519 1.4% 27.868.5% 529.171.4 6.442.066 479.443 593.089.243 79.828 20.855 5.398 4.479.9% 205.450 342.701.493 19.316 198.590 15.373 11.461.054.562 5.155 9.4% 58.162 11.496 17.232 1.051.597.2 Vertical Analysis Muslim Commercial Bank Limited Balance Sheet As on 31st December 2008 Assets Cash and balances with treasury banks Balances with other banks Lending to financial intuitions Investments Advances Operating fixed assets Deferred tax assets Other assets vertical 2009 vertical 32.239.089.058 39.761 410.808.486.265.4% 485.390 24.2% 397.3% 3.7% Liabilities Bills payable Borrowings Deposits and Other accounts Sub-ordinated loans Deffered tax liabilities Other liabilities 7.465.356 -1.476 257.598 16.017 21.9% 0.976 6.800 63.497 63.9% 1.530.990.332 12.0% 6.406.838 1.372 113.5% 16.081.577.943.6% 39.3% .9% 27.4% 10.960.92 Taxation-Current year Prior years Defferd Profit after taxation Unappropriate profit brought forward Transfer from surplus on revaluation of fixed assets Profit available for appropriation Basic/diluted earning per share 5.1% 51.260 32.473 894.426 17.024.166 5.0% 71.123 17.807.1% 21.142.1% 32.6% 630.542.722.883 3.4% 22.440 11.683.6% 155.679 23.485.180.108.156 172.2% 29.4% 744.0% 837.973 11.2% 0.824 23.3 13% -318% 1313% 26% 11% -63% 10% 21% 4% 4.

4% 176.282.93 301.675 5. commission and brokerage income 2.381 206.069.061 212.314 13.300 693.1% 4.7% 9.865 -13.011 25.656.414.1% 2.0% 23.000 1.197 1.7% 5.8% -0.291 17.750 45.0% 6.0% vertical 2009 vertical 208.5% 87.0% 8.4% 26.4% 0.500.525.276 24.2% 51.6% 20.011.1% 3.105 563.365.4% 17.705.4% 61.5% 156.959.0% 355.6% 100.929 Net assets Represented by: Share capital Reserves Unappropriateed profit 40.844.865.156 9.119.359 37.530.786.6% 100.856.3% 31.3% 20.213 6.801 Income from dealing in foreign currencies 692.3% 82.3% 12.519 55.533 21.7% 5.187.505 Total non mark up interest income 4.7% 19.061.119.4% 0.269 2.235 Dividend income 811.130.7% 25.921.3% 4.0% 5.311.302 .768 34.0013% 136.000.7% 100.0% 6.416 Income after interest income Non mark up/interest expense 19.540 47.662.702 175.426 5.7% 41.675 644.583 199 0.638 5.4% 13.842 55.610 632.252.639 40.263.0% Surplus on revaluation of assets Muslim Commercial Bank Limited Profit and Loss Account As on 31st December 2008 Markup/ return/ interest earned Mark up/ return/ interest expense Net mark up/ interest income Provision for dimininution H52in the value of investment Provision against loans and advances Bad debts written off directly Net mark up/interest income after provisions Non mark up/interest income Fee.973 35.408 1.062 121.5% 9.991.865 Unrealized gain/ loss on revaluation of investment Other income 570.014.595 4.463.314 737.867.010 Gain on investment 605.4% 105.7% 39.3% 7.7% 100.675 11.965 165.634.0% 4.844.4% 60.778.

838 4.1% 5.443 593.411 66.5% 5.5% 12.594 5.4% 5.9% 3.2% 0.94 Administrative expenses Other proposition/write off Other charges Total non mark up/ interest expense Profit before taxation Taxation-Current year Prior years Defferd Profit after taxation Unappropriate profit brought forward Transfer from surplus on revaluation of fixed assets Profit available for appropriation Basic/diluted earning per share 6.398 257.530.1% 0.022.3.708 6.562 4.824 141.4% 0.0% 4.990.265.442.9% 0.592 11.142.497 63.1 PROFIT TO DEPOSIT RATIO PROFIT / INTEREST TO DEPOSIT RATIO = PROFIT / INTEREST DEPOSIT Profit Deposit Ratio (%) • • 2009 15.164.0% 15.066 5.500.0% 36. Deposited increased and profit on deposits also increase.390 24.294.2% -8.142.3% 136.743 540.3% 18.265.2 RETURN ON AVERAGE EQUITY (ROE) .590 32.3.560.542.0% 5.3% 5.3 32.035 6.808.308.1% 36.267 21.5% 54.098.473 894.3 RATIO ANALYSIS 4.670 152.4% 17.6% 42.260 41.416 -3.7% This ratios is expressing the positive trend in 2009.398 100.332 47.828 20.022.562 292.482.2% 2008 12.559.461.4 4.426 41.4% 139.855 5.711 53.973 11.5% 36.701.9% 100.166 0. 4.356 -1.4% 23.

398 35.05% • • It is negative trend as compare to 2008.265.156 33.414.562 45.61% 2008 12.3. Equity Capital increased in 2009 but return is very low.656.675 34. 4.95 RETURN ON EQUITY CAPITAL RATIO = NET PROFIT AFTER TAX EQUITY CAPITAL Profit After Tax Equity Capital Ratio (%) 2009 15.142.3 RETURN ON AVERAGE ASSETS (ROA) RETURN ON ASSETS RATIO = NET PROFIT AFTER TAX AVERAGE ASSETS .

838 16.485.578.243 3.3. But with decreasing ratio It is not good trend 4.457 257.3.5 PROFIT TO ADVANCES RATIO INTEREST / PROFIT TO ADVANCES RATIO = INTEREST / PROFIT ADVANCES .142.96 Profit Average Assets Ratio (%) • • 2009 15. Total Deposits are also more than 2008.5% Increasing trend in 2009 of return on assets.589.108.562 410.126 292.9% 2008 42.517 3.4 FIXED DEPOSIT TO TOTAL DEPOSIT RATIO FIXED DEPOSIT TO TOTAL DEPOSITS RATIO = FIXED DEPOSIT TOTAL DEPOSITS Fixed Deposits Total Deposits Ratio (%) • • • 2009 43.066 14. Profit margin increase in 2009 as compare to 2008 4.398 342.461.265.098.5% Fixed Deposits are more than 2008.7% 2008 12.

97% 2008 12.97 Profit Advances Ratio (%) 2009 15.960.142.155 6.598 6.239.562 218.398 198. .265. Advances Increases in 2009 It good trend.12% • • • Profits are more in 2009 as compare to 2008.

066 1.098.3.022.71% 2008 6.592 257.461.416 292.6 ADMIN EXPENSES TO DEPOSIT RATIO ADMIN EXPENSE TO DEPOSITS RATIO = ADMIN EXPENSE TOTAL DEPOSITS Admin Expenses Deposit Ratio (%) 2009 5.98 4.482.51% • • • Admin expenses are less as compare to 2008 Deposits increases in 2009 Its over all good trend .838 2.

. mobile banking etc.  MCB has the largest ATM network in the country.  One of the major strengths of MCB is that it has very stable deposit base.  Customer default rate is lower as compared to other banks.  MCB investing huge sums on HR development and training.102 Chapter # 5 SWOT ANALYSIS STRENGTHS  MCB is Successive and Market oriented.  Meeting the challenges of latest Technology by introducing Smart card remit express.

103  MCB is largest private bank in Pakistan with around 1000 branches. which cover almost every part of Pakistan. EFU.  Favoritism and Nepotism in recruitment. PTC etc. of branches abroad.  High Employees Turnover.  Decision making process is very slow.  Some management positrons needed are not professional.  The bank enjoys competitive profitability in the industry. dissatisfaction due to ill treatment and improper reward system.  MCB RTC is useable only in Pakistan.  Though ATM network is the largest in Pakistan. PTCL.  The bank enjoys competitive advantage over other banks in Pakistan.  Although most of the branches are computerized now.  MCB has the accounts of big organizations like OGDCL.  Less efficiency of SYMBOL System due to disconnectivity . still some potential areas don’t have the ATM. still some important branches don’t have computers.  MCB has captured majority of potential customers in Pakistan. WEAKNESSES  Low motivational level  Employees.  It is not having greater no.

 Afghan war and Iraq war has a deep effect on the economy of Pakistan.  For the last of many years. Alfalah.  People don’t prefer banking culture. THREATS  Other private commercial bank with sound profitability is also a threat to MCB e.  Foreign banks are flourishing in field of consumer financing. Pakistan is facing economic and political instability which is a big threat.  Islamic Trading Based Banking can enhance the business of the bank.104 Opportunities  Leasing sector is growing in Pakistan for the last two to three years which provides opportunity to MCB to go ahead in this area as well. UBL.g. They mostly prefer cash transactions .  Launch the more effective and modern banking online system.  MCB is providing Consumer Finances at comparatively lower rates which paves a way to grab more customers  Financing to small/medium cottage industries will definitely increase its advances and profitability as well.  Overseas Operations. HBL etc. which may affect MCB.

This branch of MCB relatively small and has climbed its way up very quickly and all that only because of the employee’s efforts and consideration for each other Understanding and the effective management of the human resources is the most difficult challenge faced not only by the bank but by all the organizations. I am able to handle the public with respect to many different workings on many different instances and also in account opening for customers and can handle many other tasks as well. Management of the bank is very strong. Employees of MCB Timber Market branch work more than their working hours and all the workings take place in a very friendly atmosphere that does not induce pressure on the person working there.105 Chapter # 6 CONCLUSIONS With Cooperation of all branch members. Finally I concluded that MCB is a good organization for a person for his long term career workings. it is becoming clear that the true lasting competitive advantage comes through human resources and how they are managed. MCB seems . It also shows their loyalty and commitment to the organization. I have been able to learn and experience many new things related to the banking sector and the banks workings. Overall working and environment of the bank is very comfortable and the staff is very helpful and respectful of each other and it still maintains a professional environment. Even though the people have been sacrificed in the new organizational developments.

It can also improve its magazine publication that it releases each month. Need introduce friendly Products In order to compete in the ever-expanding market both nationally and internationally. was quite low. introducing new and efficient products is one of its major requirements. Some of the suggestions that I would like to give at the end are: Promotion and Mass Media Publicity MCB Bank can improve its Marketing strategies to acquire more promotion and mass media publicity by the use of effective channels of promotions like TV.106 to not focusing on this highly critical issue as the job satisfaction level of the employees working at MCB. First of all. . the management needs to overlook the major problems that the organization is currently facing and then develop strategies to eradicate them. I would then like to make the recommendations that. Centralized Structure Centralized Structure that enables employee involvement needs to be formed. Chapter # 7 RECOMMENDATIONS After doing a deep study and witnessing everything that goes on in a branch. Newspaper Advertisements.

SYMBOL SYSTEM To make the SYMBOL system more efficient and make sure its connectivity all the time in order to provides more convenience to customers. Staff Member I have observe during working that there need of more staff due to pressure of work MCB should hire more employees for better performance even any employee when take leaves Manager has no choice to his work to other employee so this situation built high pressure. .107 Better Reward System Better reward system is one of the most important requirements in order to reduce the problem of Employee retention and improve Employee motivation. Continuous Training of Employees • • • Creation of enhanced performance appraisal system Implementation of enhanced Marketing system Continuous lecture on better communication of staff with customers ATM Machines Maintained ATM machine must be maintained properly to make it more convenient for the customers and to decrease the load of work to the employees of the bank especially in the salary days.

clearing and deposit department.e. 1st week:  During the first week of my internship. remittance. During the six weeks of my internship I got a good chance to see what the actual banking is regarding the operations performed at my branch i. account opening. I opened two types of account.108 Job Rotation for Employees MCB should to make the strategy where make the job rotation of employees WORK PERFORMED DURING INTERNSHIP My internship provided me a great opportunity to learn & experience different banking practices. STAMP.  TO FILL IN THE DEPOSIT SLIP  TO ISSUE A CHEQUE BOOK TO OPEN THE ACCOUNT: During my internship.  single account  Joint account . I learnt these things at the account opening/maintenance department:  TO OPEN THE ACCOUNT  TO SET THE ACCOUNT NO.

but I know the following regarding PARTNERSHIP ACCOUNT. • how a joint account is affected by the death of one joint account holder: 3) PARTNERSHIP ACCOUNT: I did not open this account personally. • • documents needed to open this account Moreover the operation manager told me these things regarding the partnership account: Death of a partner: Admission of new partner Documents required in case of a new partner .109 1) SINGLE ACCOUNT: I monitored three types of accounts under this head along with documentation required for these accounts.’  Account of a literate person  Account of a salaried person  Account of an illiterate person 2) JOINT ACCOUNT: Besides opening this account I was provided with the following information regarding JOINT ACCOUNT by manager ops.

where I learnt the following things: • • • • • • • Study of different types of vouchers related to the TRANSFER To fill a voucher for online transfer Online transfer via cheque To issue a demand draft via cheque To post the voucher for online transfer & DD Got some information about pay order from the relevant officer To make a TT to transfer access money to the head office . i have learnt these things: 1) Cheque book issuance to the existing /new account holder: 2) Issuance of smart card (ATM) to the existing/ new account holder: Other things which I have learnt about ATM involve: • • • • • • ATM Card Categories ATM Card Features Fund Transfer via ATM ATM Card Charges Delivery & Custody of ATM Card 2nd week: My 2nd & 3rd weeks of internship were at remittance department.110 ACCOUNT MAINTENANCE ACTIVITIES: Related to the account maintenance activities.

How the manager ops authorize various transactions I also have some idea about the DAILY GENERAL LEDGER REPORT . cash and clearance departments I have some idea about the opening & closing of bank but not have a through grip on it. • • • • How he checks the daily vouchers related to transfer.111 3rd week: My 4 th week was in the cash cabin and I performed following work there: • • • • • • • • To make the online transfer voucher via cash To post these vouchers To issue a DD via cash To post the vouchers for this DD Study of cash book Study of cash position book Visit to strong room How the cash is maintained in strong room 4th week: During the 5th week. I worked with the operation manager and learnt about his working.

Study of key book .112 5th week: • • • • Issuance of RTC (Against Cash) Issuance of RTC (Against Account): Encashment of RTC Cheque deposit & withdrawal through clearing 6TH week: I did miscellaneous work in the last week of internship: • • • • • What is the function of a feeding/pooling branch? What is the inter branch Dr/Cr advice Study that how CDRs are issued How an account is made exempted from ZAKAT.

113 Chapter # 8 Glossary MCB ATM FED WHT TDR CDR PBA BBA PLS TD AOF AMO KYC SSC GBO ICO CSO DD PO Muslim Commercial Bank Automatic Teller Machine Federal Excise Duty with Holding Tax Term Deposit Receipts Call Deposit Receipts Personal Banking Advisor Basic Banking Account Profit and Loss A/C Term Deposit Account opening Foam Account maintenance officer Know your customers Specimen Signature card General banking officer Internal control officer Customer service officer Demand Draft Pay Order .

Jones .asp Vision / Mission: http://mcb.114 FTA CPD NIFT TDR RTC IBC OBC MO HO Fund Transfer Application Central Processing Division National Institute of Facilitation Technology Term Deposit Receipt Rupee Travel Cheque Inward Bills for Collection Outward Bills for Collections Main Office Head Office 9.1 References • • • • Introduction: http://mcb.pk/mcb/mission_vision.com.as Internship Activities: PBO (Mr.com.com.asp Corporate information: http://mcb.com.pk/mcb/about_mcb..pk/mcb/corporate_information. Sajid) BOM (Mr. Yasir) CSO (Miss sane) Remittance (Miss Amana) • • Financial Statement: Google.pk Ratios: Analysis of Financial Statement by Charles. P.

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