Chapter - 1 INTRODUCTION OF STUDY
1.1 BACKGROUND OF THE STUDY
Internship training program during Masters in Business administration Program is necessary for the partial fulfillment of the completion of Degree of Masters in Business Administration as per HEC (Higher Education Commission) requirement. It is necessary for me to complete an internship session of about 8 weeks in some manufacturing or service industry relevant to my area of interest and specialization. So, I choose the Banking field because I have the interest in this sector because my study background is related with this sector.
PURPOSE OF THE STUDY
Internship is the corner stone experience that provides me with handson, real-world experience in a work setting. Ideally, internship will enable internees to: • • • • Use my knowledge and skills get from the classroom, Discover where further competence is needed, Convert the bookish knowledge into practical life Become better acquainted with the types of work settings in which such Competence can be applied.
SCOPE OF THE STUDY
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, National Bank, UBL, Bank
Alfalah and many others, Students should study about the functioning of such Banks. It will help for me in future.
Primary Data Secondary Data
There are mainly two methods that are used for the collection of data.
(A) Primary Data • • Observation of functions of Branch operations on the spot. Observation of different processes of Branch on the spot.
(B) Secondary Data: • Internet is very helpful for me to study more about banking sector of Pakistan. • • • • Different type of booklets of the Bank. Annual reports Journals Newspapers
SCHEME OF THE REPORT
Chapter 1 This chapter encompasses the background of the study. It also looks into the purpose, scope, limitation, objectives, methodology and scheme of the study. Chapter 2 It gives over all view of the Bank. In this I have discussed comprehensively the history of Banking as well as historical background of MCB, its present operations, mission as well. Some light has also been shed on management and organizational structure of MCB. Chapter 3 This chapter contains SWOT analysis, critical analysis and financial analysis of MCB. Chapter 4 It summarizes the conclusions and recommendations based on the analysis. Chapter 5 This chapter includes the implementation plan.
2. 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. It was incorporated by the Adam jee Group on July 9.1. the Government of Pakistan nationalized MCB following the Banks (Nationalization) Act 1974.1 HISTORICAL BACKGROUND
MCB Bank Limited formerly known as Muslim Commercial Bank Limited MCB Bank is not an overnight success story. 2. Where the head office is presently located.1 Nationalization In January 1974. the bank moved to Dhaka (then the capital of former East Pakistan) from where it commenced business in August 1948. under the Indian Companies Act.Chapter . VII of 1913 as a limited company. In 1956.2 REVIEW OF MCB
2.1. 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 Privatization A wave of economic reforms swept Pakistan in the lattes introducing the Need for privatization of state owned banks and companies. This
. 1947. Thus. the bank transferred its registered office to Karachi.
MCB is also catering to the growing middle class by providing new asset and liability products. one of the most prestigious civil awards of the country. but also exceeds their expectation. In recognition of Mr. Nishat Group is one of the leading and most diversified business groups in Pakistan. the Government of Pakistan has conferred him with "Sitara-e-Imtiaz". making sure that they do things right. dignity and importance. Corporate clientele includes public sector companies as well as large local and multi national concerns.
2. Mansha’s contribution. The group has strong presence in the most important business sectors of the country such as banking.2
ABOUT MCB (1)
Over the years MCB has developed strong relationships with its customers by understanding their needs and treating them with respect. MCB Bank Limited (Formerly Muslim Commercial Bank Limited) has a solid foundation
. Mian Mohammad Mansha is the Chairman of the group (and also MCB) and has played instrumental role in its success. Commercial and Consumer Banking.cement and insurance. The driving force behind its commitment and services is its focus on customers ensuring that it not only meets. MCB now focuses on three core businesses namely Corporate. from branch banking to internet banking and from face to face customer interaction to online accessibility. They strive to achieve excellence by ensuring that every moment of their time is spent in adding value. With the quest of quality MCB has always taken initiatives bringing banking into a new arena. first time. and every time. textile. from cash to the convenience of plastic.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 different operational departments are: • • • • • • • • Consumer Banking & IT Division Financial & Inter Branch Division Banking Operations Divisions HRD & Legal Division Financial Control & Audit Division Credit Management Division Commercial Banking Division Corporate Banking Division
. MR. A team of 10 professionals is handling operational management of the bank.of over 63 years in Pakistan. developing a large and stable deposit base. which are imposed by concerned statutes. During the last fifteen years. Mian Mohammed Mansha also heads this team. the largest ATM network in Pakistan over 450 ATM locations in the market. 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. investment in technology and people. the Bank provides 24 hour banking convenience with a network of over 1000 branches. MR. the Bank has concentrated on growth through improving service quality. utilizing its extensive branch network.
As MCB is a banking company listed in stock exchange therefore it follows all the legalities.
In doing so.2. We deliver on our responsibilities and commitments to our customers as well as our colleagues. providing innovative and efficient financial solutions to create and nurture long-term relationships with our customers.4.”(2) Mission Statement “We are a team of committed professionals.
. We create an environment where each individual is enabled to succeed.”(3) • • • • Providing innovative Efficient financial solutions Long-term relationships with our customers Shareholders invest with confidence
2. culture and history.4
VISION & MISSION
Vision Statement “To be the leading financial services provider. We believe in being the best at always doing the right thing. beliefs. We value the equality of gender and diversity of experience and education that our employees bring with them.1 Values of MCB (4)
Integrity We are the trustees of public funds and serve our community with integrity. partnering with our customers for a more prosperous and secure future. we ensure that our shareholders can invest with confidence in us. Respect We respect our customer’s values.
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.4.2 Awards and Achievement (5)
Euro money Awards Best Bank in Asia Award 2008 MCB has been awarded as a Euromoney Award 2008 for the “Best Bank in Asia". We make every effort to exceed customer expectations through superior services and solutions. Customer Centricity Our customers are at the heart of everything we do. We are a performance driven.Excellence We take personal responsibility for our role as leaders in the pursuit of excellence.
2.Best Bank in Pakistan Award 2006 MCB has yet again received the esteemed Euromoney Award for the “Best Bank in Pakistan”. result oriented organization where merit is the only criterion for reward. It is the only bank to receive the Euromoney Award for Excellence for the sixth time in the past seven years. We thrive on the challenge of understanding their needs and aspirations. both realized and unrealized.
Best Bank in Pakistan Award 2005 Best Bank in Pakistan Award 2004
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. They are delegated enough authority from the Board of Directors so that it works without pressure. It also keeps a check over the irregularities in different branches. It has the responsibility to manage all the affairs related to agriculture sector.5
DIVISIONS OF MCB (6)
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. This division works for the development of agriculture in the country. It appoints the audit teams and all the irregularities pointed out are reported to this division. 2.1 Agriculture Division Agriculture division deals with the loans and development of agriculture sector. 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.
.2 Audit Division Audit Division is responsible for the inspection of financial affairs.
It includes financing of large and specialized corporations projects.7 Finance and Treasury Division It manages all the assets of MCB.5. This division also carries out marketing activities about the loan.2. Management of income tax and central excise duty is the function of this division.5. It also directly controls all those branches.O). Its main concern is to develop the business of the bank related to the introduction of new products.5.4 Central Accounts Division Central Accounts Division takes care of the accounts of branches and records all inter branch transactions and transaction of branches with HO. The most important
.5.5 Corporate Affairs Division Corporate affairs division deals with the affairs related to public limited companies. 2.3 Business Development and Marketing Division This division works under the Head Office (H. 2.6 Credit Management Division This division has the duty to make and alter the credit rules and regulations in accordance with the prudential rules and regulations formed by SBP. 2. 2.5. In short it manages the corporate financing. Changes in the existing schemes in favor of the bank and customer are also the responsibility of this division. which are designed as corporate branches. Calculation of profit on the account of branches maintained with HO is also the responsibility of this division. It deals with all credit proposals submitted by advances department of different branches and designs their limit of loans.
5.11 information Management Division Information Management provides all the information to the top management. It maintains records of employees and conducts performance appraisal and disciplinary actions.5. 2.9 General Service Division General service section is concerned with construction of building for branches of the bank at various localities. 2.5. It is also concerned with the purchase of vehicles and other accessories for the banks. transfer and retirement etc.8 Foreign Trades and Exchange Operation Division This division is responsible for managing foreign currency reserves for day-to-day requirements of the bank. This division monitors the information system of all branches and is playing a very important role in computerization of MCB. It frames all the rules and regulations regarding foreign exchange and opening of L/C in the light of prudential regulations of SBP. 2. promotion. It settles all the matters relating to salaries.10 Human Resource Development Division This division manages all the methods concerns with the human resources management like selection.5.
. 2. bonuses. The supply of stationary and equipment is the responsibility of this division. increments.function is to announce the profit rates on different schemes from time to time. and fringe benefits.
This division also gives suggestions on the adoption of interest free banking in Pakistan. It also manages the religious matters of hajj and Umrah. 2. This department deals with Zakat deduction. It looks after all the matters.5. Qarz-e-hasana etc. It also gives suggestions in framing of new rules and regulations to other division.2. MCB developed this division.13 International Division This division deals all the matters relating to branches located in foreign countries. 2.12 Industrial Credit Division Previously it was a part of credit management division.16 Legal Affairs Division This division deals with the legal affairs of the bank. Iqra surcharge. It deals with capital market at national and international level and also manages syndicate in case of issuing of shares etc. It handles all the cases filed against the bank. steps were taken to abolish interest from the bank transaction.14 Investment Banking Division This division looks after the investment of bank in various schemes introduced by the bank.5.5. 2. It is concerned with advances to various industrial units.5.
. which MCB carries out with banks and financial institution of foreign countries. 2.5. Zia.15 Islamization Division During the era of Late President Gen.
2. The tendency to disperse decision-making authority in an organization structure. but it is not true because no bank without its proper organizational structure stand No. (It refers to the number of personnel a manager manages by virtue of his post. branches. Regional Managers (RM`s). The tendency to restrict delegation of decision making in an organization structure.) 5 MCB is a very large and complicated organization having many divisions. MCB is running its operations successfully since 1947 and reached to the top of the banking industry. including Senior Executive Vice Presidents (SEVP`s). institutional training so that the trainee can understand the actual job cooperation. Where practical training supports necessary. and Branch Managers are delegated with powers and authorities. which are fairly. Still many decisions of small importance. So there is a mix of centralized and decentralized authority in this respect. usually by holding authority at or near the top of the organization structure. However. It also
. All the Executives. MCB policies are very flexible and changes frequently according to the situation. 1 for so many years. MCB is a very large organization with many branches in different areas of the country and different divisions under the Head Office. So it is managed through broad span of control with decentralization of authority. Normally it is said that MCB has no specific organizational structure. match able with their responsibilities and duties they perform.6
It is the graphical representation of authorities and responsibilities.4 It defines the various level of management and its span of control. Vice Presidents (VP`s). are made by Top Management for control purposes. General Managers (GM`s). and administrative offices all over the country and outside the country.
Bank introduced various new products for its customers.7.7
PRODUCT & SERVICES (7)
In order to achieve long-term goals of expansion and penetration in the market. evaluation and development of New products was started which resulted in introduction of various new products which were earlier not introduced by any other Bank in the country.
2. Introduction of these products was indeed a major source of penetration for the bank and turned out to be a differential factor as compared to other banks. ii. a constant process of market research. iii. Deposits Rupee Traveler Cheques Remit Express
Corporate Banking Investment Banking • 2. In order to do so. The services provided by MCB Bank are: • Personal Banking i. which cater to the needs of various segments of the society.1 Personal Banking Deposits Khushhali Bachat Account Mahana khushalii Account Pak Rupees Saving Account Pak Rupees Current Account Pak Rupees Term Deposit Saving 365 Foreign Currency Saving Accounts
.provides them opportunity to work in the branch environment facing customers practically and handle them.
3. Due to the low initial deposit. 50. Pak Rupees Saving Account
MCB’s Pak Rupee Savings Account offers you attractive returns on your Pak Rupee investment. o Minimum deposit of Rs. Pay Order. Your deposit to remain fixed for five years. a Rupee savings account is one of MCB Bank’s most popular products. Profit will be paid on a monthly basis through Cash. Just purchase a Monthly Khushali Certificate and you will enjoy a steady income of your total deposit every month. Mahana Khushali Account
MCB Monthly Khushali Scheme provides you with a steady income every month. You can avail a credit facility up to 75% of the total deposit value. 4. the account can be opened by people from all walks of life and still avail the facility of daily product profit calculation. Demand Draft or Direct Debit to your Saving/Current Account.
Foreign Currency Current Account Foreign Currency Term Deposit Dollar Khushhali Account Rupees Maximize Account Capital Growth Call Deposit Khushali Bachat Account
Khushali Bachat Account. The account offers unique and attractive benefits to the Account holders.
. 2.000. 1.
Pak Rupees Current Account
MCB’s Pak Rupee Current Account offers you the convenience of unlimited withdrawals i. There is no limit on the number of transactions you make in a day plus you can avail finance facility up to 75% of the total deposit. Saving 365 The MCB Saving 365 calculates profits on a daily product basis and gives you the facility of unlimited withdrawals. Pak Rupees Term Deposit Place your investment in a MCB Pak Rupee Term Deposit and receive a higher rate of return.In addition. For more information or to open an account at MCB visit one of our 900 branches today.e. o Open a Saving 365 Account with a minimum initial deposit
of Rs. o No restrictions on the number of withdrawals. 3 months.
. 1 year. you have access to a countrywide ATM network convenient cash accessibility 24 hours a day. 3 years.000. In addition. 2 years. Avail your choice of 1 month. 500. access to your funds whenever you want without any notice. 4 years and 5 year term deposits. The facility also provides you with unlimited daily transactions with a limit on maximum withdrawal amount through the ATM machines. The facility also provides you with unlimited daily transactions with a limit on maximum withdrawal amount through the ATM machines. you have access to a countrywide ATM network convenient cash accessibility 24 hours a day. 6 months. o Your Profits are calculated on daily product basis payable on
a half yearly basis.
You can avail a credit facility up to 75% of the total deposit
value. • Dollar Khushhali Account
. access to your funds whenever you want without any notice. • Foreign Currency Saving Accounts You can invest in any of the four currencies i. US Dollar. Japanese Yen or Deutsche Mark. Avail your choice of 1 month. Japanese Yen or Euro.e. 4 years and 5 year term deposits. UK Pound Sterling. o Your foreign currency account is exempted from Zakat and withholding tax. There is no limit on the number of transactions you make in a day. o You can invest in any of the four currencies i.e. 1 year.
MCB’s Foreign Currency Savings Account offers you attractive returns on your Foreign Currency investment. exempted. US Dollar. Foreign Currency Term Deposit
Place your investment in a MCB Foreign Currency Term Deposit and receive a higher rate of return. 2 years. 6 months. 3 months. Your foreign currency account is Zakat and withholding tax You can avail a credit facility up to 75% of the total deposit
UK Pound Sterling. 3 years. • Foreign Currency Current Accounts:
MCB’s Foreign Currency Current Account offers you the convenience of unlimited withdrawals i. o o o value.
o Your account is not subject to Zakat. on their deposits in Pak Rupees. Free ATM Card to each customer. Today. The profit rate on capital growth certificate is 4. You can avail a credit facility up to 75% of the total deposit initial deposit of US Rs. a Dollar based account was introduced in 1993 at selected MCB Bank branches.
MCB Rupees Maximize Account is our latest PLS saving Account specially made to help MCB Foreign Currency Account holder to convert their account into Pak Rupees. deposits are to stay with the bank for five years and every six months the profit is calculated and added into the initial deposit in this way it is a form of compounding. o o o o value. No restrictions on number of withdrawals.The Dollar Khushali Account. Locker facility free of cost Capital Growth
In this scheme.00% Minimum Deposit of 10. yearly on interest calculated at the Dollar Savings Rate. Rupees Maximize Account You can open a Dollar Khushali Account with a minimum Your Profits are paid on daily product basis payable half No prior notice required for withdrawal. No restriction on initial deposit. It gives individual.000
. you can open a Dollar Khushali Account at over 200 branches in Pakistan. 100. businessmen and Corporation the chance to earn a high rate of return The account offers unique and attractive benefits to the account holder: o o o o o • Profits calculated on a daily product basis.
Semi Government. as security deposit. and Institution Corporations etc.
This is a type of deposit offered by MCB on which no Markup is paid. The Call Deposit receipt is usually issued in the favor of Government.
without any inconvenience especially by Travelers. in Pakistan. precautions.000 and gift cheques of Rs 500. MCB Rupee Traveler's Cheques were first introduced in 1993 as safe cash for traveling and travel related purposes. MCB Rupee Traveler's Cheques. Rs Valid until Used: Validity of Cheques indefinite. Cheques cannot be duplicated.
.2. secure and profitable.
Lahore & Islamabad.The safest way to Carry Cash Rupee Traveler’s Cheques Features: • • • • • • • • Easily available: Buy them from any of the designated branches As good as cash: MCB RTCs are safe to carry and can be used Easily encased: At any designated MCB branch Easily refunded: in case of loss or theft. you can get the full Exclusive security features: Due to special printing and safety Denominations: Available in denominations of Rs 1000. • More than 900 MCB Authorized branches are selling and
purchasing Cheques all over Pakistan.7. The product has been extremely popular and is preferred over cash by customers while traveling and in all walks of life.2.
amount back. 24-hour Service available at Airport MCB booths Karachi. 5000. Rupee Traveler’s Cheques (8)
Ideal for Every Deal MCB Bank has been at the forefront of providing it’s customers with new and innovative products and financial instruments that are safe. and Rs 10.
MCB Rupee Traveler's Cheques are also available at the
counters of Foreign Banks such as ABN Amro and HSBC and private bank i.7. Personal delivery to the beneficiary.e. Remit Express Features • • • • • • Easiest and safest way to remit funds. Message facilities for both parties. Lahore. The MCB corporate banking team consists of enthusiastic.e. Delivery confirmation to the remitter. cooperative professionals with the requisite expertise to take care of your banking needs.8 Corporate Banking (10) MCB has its 20 corporate branches in major cities of all over the Pakistan. The receiver i. and Saudi Arabia. Bank Al-Habib. Its area offices are located in Karachi.
2.3 Remit Express (9)
The fastest way of getting your money across to Pakistan. These
. 2. Remit Express offers low cost remittance from U. Remittance within 24 to 72 hours.E. business associates or relatives receive drafts within 72 hours. Your beneficiary will receive the amount even if he/she does
not have an MCB account. Corporate branches have been established in the three prime cities where teams of obsessive managers have been appointed. MCB Remit Express has been specifically designed to meet the needs of the expatriate Pakistani community residing in the Gulf countries.
acting as a liaison between you and the bank.2 Term Loans For meeting the capital expenditure and short term working capital requirement of customers. 2. cross branch on-line transactions.managers have been delegated with the inclusive responsibility for managing the risk of there allocated portfolios. 2. 2. pre-shipment and post-shipment etc. 2. It also enables the bank to offer you a choice of paper based on electronic fund transfer solutions including collection amounts.1 Working Capital Loans Term Loans Trade Finance Services Cash Management Working Capital Loans
The corporate bank offers a number of different working capital financing facilities together with running finance.
. iii. ii.8. export refinance.8. iv.8. The corporate bank offers an absolute range of banking products/ services that can be generally separated in to the following categories i. purchasing export documents. and providing you with the entire range of products/ services presented by the bank.8. providing guarantees and other sport services. bank offers short to medium term finance.3 Trade Finance Service It include entire range of import export activities including issuing letters of credit. cash finance. The loans are structured on the basis of underline project characteristic and cash flows of the business.4 Cash Management The network of abut more than 1200 branches in Pakistan enables MCB to collect and disburse payments efficiently with its cash management services.
2.9 Investment Banking MCB investment banking team has emerged as a leading player in banking arena. The team handles advisory, corporate finance, and capital market related transactions. Within these areas the team has developed expertise in: • • • • • • • • Private Placement Debt Equity Underwriting Term Finance Certificates Loans Syndication Arrangement of Non Fund Facilities Merger and Acquisitions Privatization Corporate Advisory
2.10 ONLINE SERVICES (11)
2.10.1 Automated Teller Machine (ATM) MCB introduced automated teller machine in 1995 to provide 24 hours cash facility to its customers. Over the years it got great success and this encouraged the bank to expand its ATM Network. Now in 2003 MCB ATM network is the largest ATM network in Pakistan with over 160 ATM branches in different cities of Pakistan and 158 online branches where ATM cards are issued. MCB placed its ATM in Karachi, Lahore and Islamabad airports to facilitate its customers. MCB has two kinds of ATM cards with different cash with drawl limits. 2.10.2 MCB ATM Regular Card The MCB ATM Regular Card allows withdrawal up to Rs10, 000 per day and a maximum of 3 with drawl per day per card.
2.10.3 MCB ATM Gold Card The MCB ATM Gold Card allows with drawls up to Rs 25,000 per day and a maximum of 6 with draws per day per card. The card holder has to make at least two transactions to withdraw the full amount of Rs 25,000. 2.10.4 MCB Master Card (The Future of Money) Since the beginning of time, people have tried to find more convenient ways to pay, from gold to paper money and checks. Today, money is moving away from distinct hard currencies and towards universal payment products that transcend national borders, time zones, and, with the Internet, even physical space. “Plastic or virtual’’ money, credit, debit, and electronic cash products, inevitably will displace cash and checks as the money of the future. Master card International has expanded globally in more locations in the world than any other card. The card was introduced by MCB Bank Limited in 1995 and now offers card members over 15 million outlets in 232 countries. • Photo security – the first bank in Pakistan to introduce the enhanced feature of photograph on the card limiting fraud in case of card of card loss. • • • Welcomed at over 3,000 outlets in Pakistan. Provides up-to 45 days Free Credit. Joining and Annual Fees to suit you.
Cash Advance Facilities available in Pakistan and worldwide. With a network of over 1,000 branches and a team of dedicated professionals, MCB is Pakistan’s largest private sector commercial bank.
2.10.5 MCB ATM Cash Card The wide spread acceptability and frequent use of MCB ATM Cards has prompted the Bank to add more value to the cards which cater to customers evolving cash needs enabling them to go ahead with ease and convenience. This reinforces MCB commitment to provide to its customers safe and secure mode of cash substitute. MCB Cash Card is useful means of cash for MCB customers and non customers like: o o o Advantages MCB Cash Card enables MCB customers/non customers to meet their day to day cash requirements and settlement of their commercial personals cash requirement transactions. a. Secure Travelers Businessmen General Public
MCB Cash Cards are the safest alternative of the cash because the purchaser can rest assure of its security. If MCB ATM Cash Card is lost it would be cancelled immediately and the purchaser would get amount refunded easily subject to completion of refund formalities. b. Ease of Use MCB ATM cash card is the best because unlike other mode of transfer of funds/remittance which are drawn on particular branch can only be cashed at that branch. MCB ATM cash card holder can draw cash from any of MCB ATM all over the country, m-net members ATM and cirrus member ATMs globally. MCB Cash Card is disposable and with a prescribed determined value. When the value of MCB cash card is utilized fully the balance amount is nil the card will be discarded.
24 hour 365 days.11. MCB proudly introduces MCB Mobile Banking.11. including all holidays. 2. purchaser.
.Features • • • • • MCB Cash Card pin code is confidential and is only known to MCB ATM Cash Card if lost or stolen then the same will be The amount remaining on MCB Cash Card will be refunded to Loss/theft will only be entertained through the original Loss/Theft is to be reported to the issuing branch by the the purchaser.11 MCB Mobile Banking At the forefront of technological excellence. MCB Mobile Banking service is available to all MCB ATM cardholders. the purchaser. immediately marked “HOT” on the request of purchaser. 2.1 Mobile Banking at a Glance MCB Mobile Banking gives you easy and quick access to your account(s) at a time you find convenient. 2. purchaser of MCB. It can be changed from MCB ATM Machine. The convenience of accessing your account balance information and mini statements whenever you want or wherever you may need them with comfort and peace of mind.2 Banking At Your Fingertips With MCB mobile banking you can: • • Check your balance View the last 4 transaction of your MCB account.
• Statement-by-Period of each of the listed accounts. where you want to. • Payment of utility bills for registered Utility Companies. MCB Virtual Internet Banking offers a wide range of online services which makes your banking accessible anytime and from anywhere. 7 days a week and throughout the year. as well as to third-party accounts maintaining accounts with MCB. • Detailed Account Summary of all listed accounts. MCB’s Virtual Internet Banking facility is simple and secure. Option for ‘Full’ or setup as beneficiaries. • Scheduling of ‘One-Time’ as well as ‘Recurring’ Funds Transfers.2.12 Virtual Banking MCB Virtual Internet Banking offers you the convenience to manage and control your banking and finances – when you want to. 2. 24 hours a day. • Immediate or Scheduled Transfer of Funds between your own accounts.
. And it’s free of cost. With MCB Virtual Internet Banking you can access any of the banking services. • Immediate or Scheduled Bills Payment. Scheduling of ‘OneTime’ as well as ‘Recurring’ bill payments. based on the period specified.3 A Free Service MCB Mobile Banking is a free service for MCB account holders who have an ATM card of an SMS message if charged by the service provider.11. • Mini-statements of each of the listed accounts showing recent transaction history for that account(s).
• Cheque Book Request for any of your listed accounts.13 ISLAMIC BANKING (12)
• Deposit Schemes
For customers who are looking for a deposit opportunity where they can purse their funds and reap halal returns on it. in advance. and the customer (lessee) will be given the asset to use for a certain period of time in return for monthly rental
.13. • Bulk Salary Transfer for Corporate Customers.‘Partial’ payment based on the payment conditions specified by a particular Utility Company. accounts with MCB. • Personal Alerts for reminding of pre-specified events and who maintain
2. • Payment/Transfer Alerts for reminding. to facilitate them in paying salary to the corporate employees. analogous to the English term 'leasing’. transfers.1 Fund Based Facilities Ijarah Products MCB’s Islamic Ijarah. MCB offer the following products: • • • Al-Makhraj Saving Account Al-Makhraj Ianat Account Al-Makhraj Term Deposit
2. is based on the ‘Ijarah wa Iqtina’ concept which means the sale of the asset to the lessee after the Ijarah has matured. • Bulk Funds Transfer for Corporate Customers. prior to the processing of specified payments and occasions. MCB will be the owner of the asset. Under this scheme.
Parties in Murabahah Buyer Bank’s Customer Seller Bank Appointment of customer as agent of the bank (Foreign Agent Transactions) / common broker (for Local Transactions). customer and then sells it to same customer after adding profit.2 Types of Ijarah o Car Ijarah o Equipment Ijarah Murabahah It is a contract between a buyer and a seller under which the later first purchases the goods at the request of the former i.. thus increasing his own share until all the
. hence the term ‘Wa Iqtina’.13.e.3 Diminishing Musharika Equipment Defination It is a contract through which the bank and its client participate in the joint ownership of a property. Mode of Repayment Immediately in cash On mutually agreed future date Spot Murabahah (Import Related Transactions) Deferred Sale Murabahah 2.payments. MCB will give a separate unilateral undertaking that it will offer to sell the asset to the customer (lessee) at the maturity of the Ijarah agreement at a price that may be equal to the security deposit amount.13. The share of the Bank is further divided into a number of units and it is agreed that the client will purchase the bank’s share periodically.
units of the bank are purchased by him so as to make the client the sole owner of the property. Appropriate collateral / securities can be obtained as per mutual consent Insurance / Takaful will continue to execute
. The client will pay rentals for using MCB’s share of equipment.4 Parties in Diminishing Musharakah Bank (In joint partnership with its customer) Partner(Bank’s customer) Common Features Request of customer for starting a new project/expanding business/buying equipment for specific purpose. The bank will have to share all the obligations of being the co-owner.13. Bank and the client shall jointly contribute funds to purchase the equipment in the pre-agreed ratio. 2.
com.mcb. http://www.com.pk/psc/travelers_chq/ Ibid
10.asp http://www.asp http://bizcovering.mcb.pk/virtual_banking/ 12. 2.com.mcb.asp http://www.com. 5.mcb. http://www.pk/psc/corporate/ 11. 8.com. http://www.mcb. 6.mcb.asp http://www.pk/psc/accounts/basic_account.pk/mcb/about_mcb. 9. 3.com.mcb. http://www.asp Ibid http://www. 4.REFFERENCES 1.com.com.com/business/divisions-of-mcb-bank/ http://www.mcb.pk/islamic_banking/introduction.asp
Pioneer in introduction of MCB Master Card and RTC. 7. The largest private sector bank in Pakistan with a network of 1040 domestic and 5 foreign branches. now become the leader in market with largest on line ATM network in the country. 9. which has really improved their commitment.
. 4. Extension and improvement in services to domestic as well as foreign customer.1.Chapter . 8. products and services suiting best to their life style. 6.1 Strengths 1. MCB has a brand name and recognition. Easy access to the customers at their residential localities through a large number of branches. for employees. Recognition of critical condition and need for Drastic immediate change. dedication and hard work. 10. 24 hours cash access through ATM. MCB has long-term vision. which plays a very important role in organization’s success. 11. which minimize the degree of riskiness. MCB instant financing products for customer wanting instant loan facility at MCB branches. Best and optional policies and attractive compensation packages.3 ANALYSIS
3. 2. towards the accomplishment of banks objectives. 3. 12.1 SWOT ANALYSIS
3. Bank’s emphasis on consumer banking by providing them with innovative saving schemes. First bank to privatize. 13. which has. 5. Attention and sensitivity to competition prevailing in the country.
. with the down sizing. 15. A very small foreign.1. No. 6. 16. 2.14. The current customers list of MCB is very large and having a large number of deposit. No marketing of advances 10.2 Weaknesses 1. with small amounts are not given some services and dealing to those with high accounts.e excess operating cost 8. Experienced but old staff. Political pressure from vested interest group selection. which is definitely a truly innovative product and according to the needs of the customers. Customers having account. among the employees is found. 3. Not many advances to agriculture sector and small and medium enterprises. MCB has now started Mobile banking. 4. Financial weaknesses i. Of branches is decreasing because of low profitability. 3. Human Resources i. It is well aware of the Market and adopts strategy according to the competitor’s strategy. A sense Insecurity of jobs.e low morale due to following factors: • • • • • • Under compensation No accountability No development Political interference No database Untapped markets
9. who are not aware of using modern technologies/ equipments 5. Network 7. 11. No training for advances in-charge.
launching of new products like Mala Maal and Cash Card etc type of product in future 10. The formation of new and energetic marketing teams can increase the disbursement of loans and new customers can be searched out. if they expand its ATM and branch network to other countries of the as well. 12. 6.4 Threats 1. Focus on small business. Benefits from incoming expertise and competition. 5. export/ import sector. 2. MCB can expand its 24 hours cash facilities to the far off cities of the growing market demand. Increasing foreign banks in the country. 3. Growing policies of government on business and commerce sector provides MCB and opportunity to efficiently meet with the business people’s requirement of instant cash and financing facilities. Stronger position to recover bad debts 7. 3. They can capture a large portion of the market. MCB has also an opportunity to expand its new technological advancement like. MCB can open women branches.3 Opportunities 1.
. Highly specialized and attractive services provided by foreign banks to their customers. 9. New schemes should be introduced to finance commodity operations. To open overseas branches through out the world like National Bank and HBL or merger with other foreign banks outside Pakistan. Due to largest ATM network.1. 4. 11. 2. tele-bank and Internet banking efficiently. especially in those areas where women class want to get involved but couldn’t due to environmental restriction. 8.1. Privatization of other domestic banks has also increased their services. 3. Increasing focus/target on different types of customers.3.
GNP and GDP rates are low and so the saving are low. 10.4. 5. There is no special training given to the employees for motivating customers. Un-consistency in government policies regarding to business and economic sector. 13. 7.(1)
3. Strict regulations by the government over credit facilities to the customers as to meet the prudential regulations. The relationship manager has a very close contact with the customers and this is his duty to give proper guidance to the customers.
.2. Concentration risk is involved with the credit department. 6. Rising customer’s expectations 9. Where as in MCB I have found that the customer relationship is not up-to the satisfactory level. Growing global technological advancement. 11. Inflation rate is high. Return of deposits is very low. 3.2. Loss of confidence of the customers due to freezing of accounts 8.1 Customer Relationship In the bank the officers come across many customers daily. Slower economic growth rate of the country. There is a need to improve the customer relationship in all the departments. 12.2 Inadequate Training Program As the employee finishes his training he is induced in a specified field since he does not have knowledge about the specific job assigned to him thus he feel difficulty to perform his job.2
By motivating people they can create a change in the bank. But in MCB I have seen that there was easy accessibility to account information. which has to be improved. Anyone can call and can get the information from the bank. There is also lack of latest software. It results in the inefficiency of work. Few people are working and the workload is very much high on them. 3. performing the same duties. The employees of the foreign exchange and other departments have the same routine for years after giving a seat to the probationary officer.T Road). credit and foreign exchange department of the bank. (MCB.2. which has been creating trouble in the bank.
.2.3 Shortage of Latest Computers There is a shortage of latest computers. They have been using the same old computers.7 Lack of Motivation Motivation is the most important aspect in any organization. 3. A person can spend years sitting in one department.2. which results in slow processing. There was not enough security as far as the accounts were concerned.6 Shortage of Staff There is a shortage of staff in the deposit. 3.4 Poor Job Rotation There is no specific job rotation in MCB. the management forgets about him for at least six months.2.G. Pesh. Officers spend most of the time in the same department. those are out dated now a day.5 Lack of Security The most important aspect consider in the bank is security.3. The Mall.2. 3.There is a lack of motivation in the employees of all departments.
3.9 Improper Work Distribution I have noticed it through out my whole internship.2. If hard work and performance of the staff members is not recognized and appreciated.2. Few people have to perform less responsibility with same grade and few have to perform more responsibility. work till late night at stretch without getting any over time.10 Lack of Appreciation Another very important thing that is ignored in different department is appreciation of the employees who work with dedication and efficiency. it dis-hearts them resulting in poor efficiency. The manager specially faces problems in this regard.2. Moreover they even have to come to the bank early to finish the remaining work and also sometime on holiday.
. They most of the time.3. which was also irritating for me that the work distribution is totally improper here. It is usual practice for the employees to stay beyond the official working hours.8 High Work Load The workload on the employees of MCB is immense. 3.
. Short term creditors are interested in the short term liquidity of the business and long term creditors are interested in the long run cash flow which the firm can generate over the long period of time. Financial statement analysis helps in determining the financial conditions at any particular point in time and effectiveness of operations of a firm during a specific period.3.3
Financial statements are the principal means of reporting the financial condition and results of operations of a business entity. Such analysis is called time series analysis. Investors are interested in the firm’s ability to sustain profitability over a period of time. 2. The internal users of financial statement like management also analyze financial data for planning and control. Government agencies analyze financial data for tax purposes. Ratio Analysis Index and common size analyses are used to measure a firm’s performance over time in relation to itself. The various stakeholders of business are all interested in the analysis of financial statements. These statements are the means to assist various parties in decision making who are interested in the activities of the business. These statements are means to an end of helping stakeholders in decision making to improve the quality of decision making proper analysis of these statements helps a lot. For example creditors and credit reporting agencies are interested in finding out the credit worthiness of the firm to which they have extended credit or intend to extend credit. Time Series Analysis. But the focus of interest of all is not the same. The financial data of MCB is analyzed in the two following ways: 1.
1 Common size analysis Common size analysis is an analysis of financial statements where total assets divide all balance sheet items and all income statement items are divided by net sales or revenues. However. A statement item that has increased in rupee amount will show a decrease percentage if the total has increased at a greater rate than the individual item or vice versa. growth or decline in various items of balance sheet and income statement cannot be detected from the common size percentage only changes in the data relative to a total for a particular date or period can be determined. Common size statements can be extremely helpful to highlight changes over time in the financial performance and financial condition of a company.3.
359 8182.697 290406.64 Inappropriate profit 5130.780 8536.12 Deferred tax assets 0.484 4265.83 Deposits and other accounts 292098.0 Surplus on revaluation of assets 9705.75 Total 45414.502 229341.16 172.97 35657.98 6577.06 Borrowings 39406.549 1466.828 69481.00 finance lease Other liabilities 11722.93 5463.37 Investment 113089.68 Total Liabilities& O’E 410485.967 298780.00 11171.753 5471.77 Reserves 34000.454 191.84 NET ASSETS REPRESENTED BY: Share capital 6282.0 5187.16 11031.940 4990.484 0.48 257461.93 0.260 18311.60 Other Assets-net 17868.07 Sub-ordinate loan 479.24 7089.37 342108.296 298780.02 21081.Table 1:
Common Size Balance Sheet
2009 ASSETS (Rs in million) Cash and balance with treasury 39683.52 Lending to institutions 1051.71 9054.24 2007 23665.00 275046.00 8192.045 9998.68 23943.16 Total liabilities 355365.31 342108.50 301263.52 LIABILITIES Bills payable 10479.44 0.88 banks Balance with other Banks 3807.80 63486.49 Total current liabilities 354185.52 Shareholders equity 55119.338 275046.40 Operating fixed assets 16024.64 40844.00 Total Assets 410485.76 Total current Assets 394461.84 1597.23 Liabilities against assets subject to 0.327 9054.68 Deferred tax liabilities-net 1180.28 24662.890 1598.43 5530.26 Advances 218960.0 5423.487 180322.674 27377.769 23734.52 Source: MCB.32 198239.00 301263.080 0.45 332881. (2009) Annual Report
INCOME STATEMENT PERFORMANCE Table no. commission & brokerage 2635 income Dividend income 632 Income from dealing in foreign 693 currencies Gain on sale of securities-net 1501 Unrealized loss on revaluation of investment Classified as held for trading -13 Other income-net 563 Total non-mark-up/interest 6011 income 26867 Non-mark-up / interest expenses: Administrative expenses 5022 (reversal) other provision-net -4 Other charges 541 Total non-markup / interest 5559 expenses Extra ordinary / unusual item Profit before taxation 21308 Taxation-current year 6442 -prior years -1294 -deferred 895 6042 Profit after taxation 15266 Unappropriate profit brought 5531
. 2 Mark-up/return/interest earned Mark-up/return/interest expensed Net mark-up/ interest income 2009 31787 7866 23921 2008 25778 4525 21253 121 1015 47 1183 20090 2311 812 692 606 571 4991 25061 6483 11 67 6561 18501 5701 593 63 6358 12142 4990 2007 17756 2781 14975 -98 1242 1 1144 13830 2449 480 531 866 2 1425 5754 19584 6459 -73 179 6566 13018 4611 -150 -365 4096 8922 502
Provision for diminution in the 105 value of invest Provision against loan and 2960 advances Bad debts written off directly 0 3065 Net mark-up/interest income after 20856 provision Non-mark-up / interest income: Fee.
3 share-after tax Source: MCB.3.net of tax 5543 Profit available for appropriation 20808 Basic & dilute earning per 24.
A ratio is a quantitative relation between two magnitudes of the same kind.2 Ratio Analysis
32 5022 17165 19. should ensure that predetermined uniform standards are used for this purpose.33
84 586 9509 17. In ratio analysis. Before discussion financial ratios. Only when a group of ratios is used. a reasonable judgment concerning the firm’s overall financial state can be made. the financial ratios of the firm are compared to that of its competitors. An analyst. which if corrected. three cautions are in order: a. c. A single ratio does not generally provide sufficient information to judge the overall performance of the firm. It must be ensured that the data used in calculating financial ratios have been developed in the same manner and are sound and reliable. Ratios only suggest the questions that need to be answered and provide no answers. (2009) Annual Report 3. There is no doubt that financial ratios are a useful guide for managerial decision-making but these are not exact and definite. will increase its efficiency.forward Transfer from surplus on 12 revaluation of fixed assets. when comparing financial statement. Another very popular method of ratio analysis is to compare the firm’s financial ratios to industry average or similar form in industry or to our own past performance. This comparison allows the firm to detect major operating differences. b.
But there are certain basic ratios the are frequently used. The number of financial ratios the might be created is virtually limitless. these ratios are as:
Financial Ratios of MCB
Current Assets Current Liabilities
. only ratios are the viable option for them. comparison with the other competitors in the same industry can only be carried out with the help of financial ratios. Among various reasons one cogent reason can be put forward that ratios help in comparison. These ratios are calculated from the “Balance Sheet” and “Profit and Loss Account” of MCB Bank. One may ponder that why there is a need to mingle with these ratios and not take the actual figures straightforwardly. When ratio analysts are to compare the internal performance of the organization in relation to time. Financial Ratio “A financial ratio is an index that relates two accounting numbers and is obtained by dividing one number by the other”. Along with it.Let us now calculate some of the key financial ratios of MCB for the years 2007-2008 and try to answer the questions that these ratios suggest.
02 2007 1.04 1.3
Current Ratios For 2007. the greater is the company’s ability to meet its short term obligation as the come due.12 1.106
1. Current ratio is calculated by dividing current assets by current liabilities. (2009) Annual Report
2009 394461 354186 1.1
Source: MCB. The higher the ratio. 2009
2007 Current assets Current liabilities Current ratio 290406 275046 1.08 1.10
2008 332882 301264 1.10 Ratio 1.Its shows the firm’s ability to meet its short term obligations. Table No.11
86 410486 0.84 2008 261725. and 2009 2007 Sales Total assets ATR 249804.81
.77 2009 332049. This surely improves profitability as the percentage of current assets.06 and thenit increased to 1.
ASSETS TURNOVER RATIO
Net sale (advances + investment) Total Assets This shows revenues generated per rupee investment in total assets.10 to 1. this rise in the current ratio of MCB shows the defensive approach of MCB towards working capital. 2007.10 in the year 2008 mainly due to an increase in current assets of the bank. Table No. This ratio is calculated by dividing net sales (advances and investment) by total assets. 4 Assets turn over ratio for.11.INTERPRETATION
Current Ratio of MCB for the last three years shows an increasing trend.48 342108 0. But in the year 2009 it was just increased from 1. In the year 2007 it was 1. 2008.24 298781 0.
so we can interpret that MCB is effectively utilizes its resources. This ratio is decreased in 2008 as compared to 2007 which is 0.81. (2009) Annual Report
INTERPRETATION This shows revenue generated per rupee investment in total assets.80 Ratio 0.2
Source: MCB. but in 2009 again the ratio increased to 0.77
0.40 0.0 0.84 and in 2008 it comes to 0.Graph no.60 0.84
0.77. DEBT TO EQUITY RATIO
Total Debt Shareholder Equity
The Ratio shows extend to which the firm is financed by debt.
(2009) Annual Report
.59 2008 301264 40844 7.38
6.Table No. 2008 and 2009 2007 Total debt Shareholder equity Debt Ratio 275046 23734 11.45
Graph no.5 Debt to Equity Ratio for 2007.59 7.45 Ratio
Source: MCB.38 2009 355366 55120 6. 3
14 12 10 Ratio 8 6 4 0
.MCB‘s upward trend of Debt to Equity ration shows that the bank is not relying in debt financing. The ratio of 2009 as compared to 2007 has increased.
.92 2008 301264 342108 0.4 275046 298781 0. 2008 and 2009. The ratio is derived by dividing a firm’s total debt by its total assets.88 2009 355366 410486 0.6 Debt to total Asset Ratio for the year 2007. 2007 Total debt Total assets Debt Ratio Graph no.DEBT TO TOTAL ASSET
Total Debt Total Assets Debt ratio shows the fraction of the company’s assets that is financed by debt. Table No.
(2009) Annual Report
INTERPRETATION This ratio highlights the relative importance of debt financing to the firm by showing the percentage of the firm’s assets that is supported by debt financing. Here in our case of MCB this ratio is decreasing from last three years.1. So we
.8 0.0 0.87 Ratio
Source: MCB.2 1.4 0. the greater the financial risk.92
0. the higher the debt-to-total assets ratio. the lower this ratio the lower the financial risk.6 0.
2008.can interpret that MCB is taking continuous steps to lower its debt financing and thus lower its risks.
INTEREST EARNED RATIO
Earning before interest & Taxes Interest Expense This ratio shows that number of time a company can cover or meet its financial charges or obligation.68 2008 18501 4525 4.7 Coverage Ratios for 2007. Table No.71
.09 2009 21308 7866 2. and 2009 2007 EBIT Interest expense Interest earned ratio 13018 2781 4.
The interest coverage ratio of MCB has shown a decrease over the period of three years.
GROSS PROFIT MARGIN RATIO
5 4 3
4. the greater the likelihood that the company cour its interest payment without difficulty.71 times the interest expense. In general the higher the ratio. the ratio is 2.71 which show that the income in 2009 cover only 2.Graph no.68
4. In the year 2009. (2009) Annual Report
INTERPRETATION The interest coverage ratio of MCB serves as one measure of the firm’s ability to meet interest payments and thus avoid bankruptcy.09 2.71 Ratio
1 0 2007 2008 Years 2009
34% 2008 21253 25778 82.25%
Source: MCB. Table No.00%
100. after we deduct the cost of producing the goods.34%
82.00% Ratio 60.00% 20.00% 80. (2009) Annual Report
. 8 Gross Margin Ratio For 2007. 2008 And 2009 Gross profit Revenue Gross profit margin Graph no.44% 2009 23921 31787 75.Gross Profit Net Revenue
This ratio tells that the profit of the firm relatively to sales.44% 75.00% 40. 6 2007 14975 17756 84.
NET PROFIT MARGIN RATIO Net Profit after Taxes Net sale It is measure of the firm profitability of sale after taking account of all expense and income taxes. The reason for this decreasing trend is that the gross profit of the bank is decreasing and this decreasing in gross profits is due to the remarkable increase in mark up interest.48 5. The reason for this increase in mark up expenses may be the management inefficiency in controlling these expenses.60% X 100
.9 Net Profit Margin For 2007. Table No.86 4.60% 2009 15266 332049.INTERPRETATION It is obvious from the figures of Gross profit margin that the Trent is constantly decreasing for the last three years.57% 2008 12142 261725.24 3. 2008 And 2009 2007 Net profit after tax Sales Net profit margin 8922 249804.
6. general administration or selling expenses has shown a slight decrease. This means that through the selling price has increased the other expenses of the bank like operating.00% 5. (2009) Annual Report INTERPRETATION Net profit margin of MCB has shown a fluctuating trend in the year 2007 it was 3.Graph no.00%
5.00% Ratio 4.60% 3.00% 2007 2008 Years 2009
Source: MCB.57% but in the year 2008 it was increased to 5.60 in the year 2009.00% 3.60% and again slightly dropped to 4.00% 1.60%
Ratio 2. RETURN ON INVESTMENT RATIO Net Profit after Taxes Total Assets X 100
This ratio measures the profitability per rupee of investment in assets.
55% 5. 2008.Table No.8 8922 298781 3.55% 2009 15266 410485 3.00 %
3.00% 1.10 Return on Investment Ratio for 2007. (2009) Annual Report
.00% 2008 12142 342108 3.00% 0.00% 2. and 2009 2007 Net profit after tax Total assets ROI Graph no.72%
Source: MCB.00% 4.00% 2007 2008 Years 3.00% Ratio 3.
0% and increase to 3. In 2007 the ROI is 3.MCB’s ROI has shown improvement over the last three years.72%.55% in 2008 and then slightly increased to 3.
. This is due to the increase in net profit margin of MCB.
11 Return On Equity For 2007.00% Ratio 60.72% Ratio
.73% 27.00% 0. (2009)
37.9 8922 23734.31 29.29 37.72%
100.68 27.00% 20.60% 2008 12142 40844.73% 2009 15266 55119.00% 80.RETURN ON EQUITY RATIO
Net Profit Total Equity
This ratio shows that residual profit as a proportion of the bank value of common shareholder equity. And 2009 2007 Net profit after tax Shareholder equity ROE Graph no.00% 2007 2008 Years
Source: MCB. 2008.60% 29. Table No.00% 40.
In the year 2007 the ROI is 37. (2009) Annual Report INTERPRETATION The ROE of MCB has shown a decrease trend.6% but decrease in the year2008 and also in 2009 it comes to 27.Source: MCB.
. this decrease in ROE is due to unimprovement in Net Profit Margin.72%.
Accounting. F. the basis for business decisions. Williams. http://bizcovering. Irwin McGraw-Hill. MCB Manual on General Banking.13
. P. Robert.REFERENCES 1.S.M. 3.com/business/swot-analysis/ 2. Bettner.F Haka and M. New York. S. (1999).
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. 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.1 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. 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. was quite low. Management of the bank is very strong.
.Chapter .4 CONCLUSIONS & RECOMMENDATIONS
4. I have been able to learn and experience many new things related to the banking sector and the banks workings. it is becoming clear that the true lasting competitive advantage comes through human resources and how they are managed. It also shows their loyalty and commitment to the organization. Even though the people have been sacrificed in the new organizational developments. 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. MCB seems to not focusing on this highly critical issue as the job satisfaction level of the employees working at MCB. 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.
It will cost the bank but will be more profitable for the bank in the long run.4. seminars and other interactive techniques. based upon development of right attitude.2 RECOMMENDATIONS
4. who are apparently ordinary workers. By attitude the manager can improve the relationship with the customers. For attitude improvement special courses should be arranged under specialized teachers. Although MCB has been improving its corporate behavior. Self-dignity is the most valuable thing to every body. the manager can improve the relationship with the customers. if the lower employees are given proper attention and the attitude of the manager towards lower management is good. even then they should continue their effort for better corporate behavior. MCB should understand that the commitment to satisfy customer’s needs must be fulfilled within a professional and ethical framework. 4. play a vital role in the organization.2 Management and Subordinate Relations Employees. The manager should improve attitude towards their subordinates. The staff is the most valuable asset. There is a need of improving customer relations in MCB. through lectures. they will be motivated satisfied and loyal to the organization. The human resource manager should focus on multi talent hiring and professional grooming.1 Customer Relationship Knowing the customers and their needs is the key to business success.2. They should observe a culture of high ethical standards.
.2. what a customer wants. By having the understanding.
4. With the empowerment of lower level employees they will feel secure in the organization and they will work with devotion for the betterment of the organization.4.2.
. so that the performance delivery is made more flexible.3 Top-Bottom Communication The down ward communication is very important because the information flows down the hierarchy from superiors to subordinates. The downward communications needs to be improved. therefore. Proper training from specialized communication teacher should be given to the managers as well as the lower level employees so that they become good listener as well. by making sure that policies made at the higher level properly reach the lower level and those policies and procedures are properly understood. They must improve their messages. the future of MCB lies in the fact that they should remain committed and necessary empowerment should flow regularly to lower levels of hierarchy.4 Empowerment of Employees Commitment is a function of empowerment down the line. they must become better encoders and decoders. Delays create hurdles in the functioning of the bank. decisions and other instructions and policies in efficient and effective manner will enhance the over all productivity and image of the organization.2. Decisions should reach as quickly as possible without any delays. Flow of information. Secondly they must improve their own understanding of what customers and subordinates are trying to communicate to them. the information they wish to transmit. To improve the communications in the bank the managers should strive to become better communicator and they must accomplish to separate tasks.
So.4. 4.e to provide training on new specialized program to the employees of computer department.2. The employees of the bank should be trained with the basic concepts of the marketing under the guidance of the experts. i. So with the passage of time the employees become up-to date with the latest innovations of the bank. Moreover the bank should send the employees for specialized courses. The workload is very high in this deptt: so to decrease the workload a fast version of windows should be introduced.
.5 Technology Incorporation Latest software should be introduced in all departments so that data processing of computers can be enhanced.2. The use of new technology can help the employees of computer deptt. 4.6 Marketing Culture The employees should be given special training for marketing. The Mall Branch. The officers in all deptt: of the bank are still working with the old computers. Another drawback is that there is only one computer at MCB.7 Improve Productivity In order to strengthen the operational capabilities of the employees the bank must organize a number of in-house training courses and seminars on different topic relate to advances and other departments. that. The conditions of the computers are not satisfactory. they could compete on equal footings with other banks.2. Proper action should be taken for marketing so that the increased sale of different products will result in increase of the profit of the bank.
4.9 Availability of ATM cards Ensuring the availability of ATM cards is very important. in different fields. Hiring the business graduates.
. from reputed institutions.2. Special emphasis should be laid on the skills and personality development. This will help in enhancing professionalism and employee development. The bank should continue to build on its human resource base with the right level of skills and talent to meet the current and future business.2. It will take less time and customers will receive their cards on time. If the communication system is improved as earlier discussed. to improve the efficiency and productivity of the organization. This can be decreased either by hiring more people or by introduction of advance computer technology in the bank.8 Proper Distribution of Work Load Load of work on the employees in all the departments of MCB The Mall Branch is very high. In addition to in-house course the officers and executives of the bank should also send for advance level courses in management and banking. can solve this problem. For hiring the standard procedures of the bank should be applied. this problem can be solved out.3
HUMAN RESOURCE DEVELOPMENT
Human resource development is a key priority of the bank. Another way to improve this facility is online issuance of ATM cards through direct access on the net. offered by various specialized training institutions such as Lahore University of Management sciences (LUMS) and the institute of Bankers in Pakistan (IBP).4. 4.
compensated or promoted. Employees on the job must be motivated to perform at an acceptable level.4. MPA etc.4
PROPER JOB ANALYSIS
Right person for the right job is the most important factor for any organization. in a branch having one computer. Also employees should be given some extra benefits like bonuses etc to motivate them. Proper compensation and incentives should be given as it will satisfy their wants and in return the employees will work with dedication. Only on the basis of proper job analysis it can be decided how a right person can be hired. still they do not have all the branches online.
4. trained. the bank new recruitment policy is based on hiring highly qualified young people like MBA. the employees being a graduate do not have proper know how about the job. So the managers in MCB should properly motivate their subordinates. They should try to improve this area and to diminish the entire book keeping methods. Online banking is impossible without the modern IT technology.
. needs more and modern computers to handle the situations.6
MCB should start online banking through out the country as they are the pioneers in it. Some of the employees are simple graduates. However. along with the trained staff. Managers themselves must be motivated to do a good job. Also. there is a lot of work to do with it. which will surely be helpful in their operations. They are unable to optimize the efficiency of the bank thus creating problems for both organizations and the employees.5
Motivation is the most important aspect in any organization.
as it will broaden the scope and the market for the organization. Also there is a need to improve the website and to improve the facilities on it. Such activities should be encouraged at once in a month. For example. MCB already have female staff but they are up-to few model branches. the entire customers should be served at a single counter and there is no need for the customer to move from one to other for a separate work. It means. They already have its own web site but it have no proper detail about its products and other facilities. Before opening female branches proper market survey is needed which will help the bank to judge the response of the people about the female banking of MCB. there should be the facility to open online account and other such dealings should be made on-line.8
IMPROVEMENT OF SERVICE QUALITY
MCB should try to the service quality and bring it up-to international standards.10 HEALTHY ACTIVITIES
There is lack of healthy and entertainment activities like excursions on weekend.
MCB should try to develop e-banking as well.
4. parties and other important days.4. celebration in their tidy life.
FEMALE BRANCHES OF MCB
MCB should seriously consider opening of female branches to solve the problems of those female employees who does not feel good while working with male staff. It should seriously consider about the female staff and also to open some exclusively female branches. One-window operations should be introduced so that the customer could wind up his work as quickly as possible.
cultural. which MCB can follow: • Stability Strategy
This type of strategy is used when organization is in stable condition/ position or reaches its maturity period. moral.
.5 ACTION PLAN
Surely if the strategy is correct and then implemented in a right way then there will be no doubt that desired results wouldn’t be achieved by the bank in a particular time. Instead of down sizing. After banks objectives have been determined all aspects of the problems confronting the bank must be thoroughly examined and accurate evaluation made of the character. Options should be developed to provide choices for possible contingencies. social. Strategy can be formulated only after the objectives to be accomplished have been determined. Following are different strategies. taking into account the opposition that may be met as the strategy unfolds. and capabilities of the various available element of bank. size. Strategy involves the use and close integration of economic. are analyzed to develop the best strategy possible. Vertical and horizontal integration is done in this stage. Then possible courses of action. spiritual. political. utilizing the power elements in varying combinations. and psychological power.Chapter . right sizing should be adopted so that to inject new blood to the bank which will bring innovations according to the demand of the market.
. Account opening facility must be provided at the doorstep.•
As MCB has a very large network of branches. They search for more and more facility at banks. It will help to develop long run relations with the customers and they will become brand loyal forever. as the peoples are getting busy day by day. Implementation In stability strategy. but urgency is needed. It will also take some time take action on it. They must try to increase focus on the already existing customer. universities. So. out which most of the branches are not productive/ profitable. All these innovations and quality services need modern technology and heavy investment in this field. MCB must try to provide services at the doorstep. MCB should focus on customer retention. New and innovative products like cash cards must be introduced to facilitate the customer. Retrenchment strategy should be adopted for those branches whose performance is not good for the past few years and still making loss to the bank. If. The ATM network must be at each and every market. Providing quality services to them can retain the customers. all the above suggestions are seriously considered. and big organizations. There is no need to attract more and more customers. The attitude of the employees can also attract the customers.
3. M. (2002).
Pak-Imperial Book Depot. J. Accounting. Printice-hall. Lahore: Van Horne.139
6. Van Horne.C and J. New Jersey: Printice-hall Inc.
(1999). New Jersey. Wachowicz. Williams.A. (1998). Bettner.C and J.A. Wachowicz. Inc. P.F Haka and M. (1998). 799
1. the basis for business decisions.M. P. F.
Robert.S.M. Irwin McGraw-Hill. Lahore. p. New York. p.143
4. S. (2002). M. Jr.13
2. Advanced Accounting. 10th edition.
Foundation of Financial Management.
Foundation of Financial Management. J.M.
Pak-Imperial Book Depot. 10th edition. p. Advanced Accounting.
Williams.mcb. (1999). Jr.S.A. Accounting. Van Horne.M. Pak-Imperial Book Depot. Ghani. Lahore: Pak-Imperial Book Depot. Printice-hall. (1998).A. (2002). J. Management.com. Irwin McGraw-Hill Ghani.
. Foundation of Financial Inc. Bettner. S. New Jersey. F. 10th edition.
WEBSITES http://www. New York.C and J. M.com MAGAZINES/ ANNUAL REPORTS Magazines of MCB Annual reports of MCB MCB Manual on General Banking. M. Advanced Accounting. (2002).BIBLIOGRAPHY
BOOKS Robert. the basis for business decisions. Lahore.F Haka and M. Advanced Accounting.pk http://bizcovering.M. Wachowicz.