INTERNSHIP REPORT ON

MCB BANK LIMITED

Submitted By:
Hassan Manzoor
Registration No. 2020- UMDB-000198

Department of Management Sciences

University of Azad Jammu & Kashmir, Muzaffarabad
JULY 2023
 INTERNSHIP REPORT ON
MCB BANK LIMITED

Submitted By:
Hassan Manzoor

Registration No. 2020- UMDB-000198

This internship report is submitted in partial fulfillment of the requirements for the degree of
Bachelor of Management science awarded by the University of Azad Jammu & Kashmir,
Muzaffarabad.

Department of Management Sciences

University of Azad Jammu & Kashmir, Muzaffarabad
JULY 2023

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 Department of Management Sciences
University of Azad Jammu & Kashmir, Muzaffarabad
Approval Sheet

1. Evaluator

Mr. / Ms. Signature _______________

2. Chairman

Mr./ Ms. Signature ________________

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 Student’s Declaration

I declare that this material, which I now submit for assessment, is entirely my own work
and has not been taken from the work of others, save and to the extent that such work has been
cited and acknowledged within the text of my work. I understand that plagiarism, collusion, and
copying are grave and serious offences in the university and accept the penalties that would be
imposed should I engage in plagiarism, collusion or copying. I have read and understood the
Assignment Regulations set out in the module documentation. I have identified and included the
source of all facts, ideas, opinions, and viewpoints of others in the assignment references. Direct
quotations from books, journal articles, internet sources, module text, or any other source
whatsoever are acknowledged and the source cited are identified in the assignment references. This
assignment, or any part of it, has not been previously submitted by me or any other person for
assessment on this or any other course of study.

I have read and understood the referencing guidelines as recommended in the report
guidelines.

Signature: ______________________

Name: Hassan Manzoor

Registration #: 2020- UMDB-000198

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5
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 Dedication

This report is dedicated to

My Loving Parents and

Honorable Teachers

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 Table of Content
Content Page#
Title Page 1
Inner Page 2
Student Declaration 3
Internship letter- Scanned copy 4
Dedication 7
Table of Contents 8
Acknowledgment 10
Executive Summary 11
1.0: INTRODUCTION OF THE REPORT 8
1.1: Introduction 14
1.2: Purpose 14
1.3: Sources and Methods of Collecting Information 15
1.4: Limitations of Information Gathering 15
2.0: ORGANIZATIONAL PROFILE 16
2.1: About MCB 16
2.2 Nationalization 16
2.3 Privatization 16
2.4: Board of Directors 17
2.5 Other Information 17
2.6 VISION STATEMENT 18
2.7 MISSION STATEMENT 18
2.8 Core Values at MCB 18
2.9 Awards of MCB 19
2.10 Organizational Setup 20
2.11 Management Structure 21
2.12 Branch Level HIRARCHY 22
2.13 Managerial Policies 23
2.14 Products & Services: 23
2.14.1 Online Services 24
2.14.2 MCB ATM Regular 25
2.14.4 Utility Bills Payment 24
2.14.5 Accounts 25
2.14.5.1 Basic Banking Account(BBA) 25
2.14.5.2 Current Account 25

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2.14.5.3 Saving Account 26
2.14.5.4 Foreign Currency Account 26
2.14.5.5 MCB Smart Business Account 27
2.14.5.6 365- Gold Plus Account 27
2.14.5.7 Term Deposit 27
2.14.6 Loans 28
2.14.6.1 MCB Car 4 U 28
2.14.6.2 MCB Credit Card 28
3.0: Job Description and Analysis 32
3.1: Work Done by Me 32
3.1.1: First Week 33
3.1.2 Second Week 34
3.1.3 : Third Week 35
3.1.4. Fourth Week 37
3.1.5 Fifth Week 38
3.1.6: Sixth Week 39
3.2 FINANCIAL ANALYSIS 40
3.2.1 Statement of Financial Position 40
3.2.2: Profit And Loss 41
3.2.3: Explanation of Results 42
3.3: SWOT ANALYSIS 43
3.3.: Internal Analysis 43
3.3.1 Weaknesses 44
3.3.2: External Analysis 44
4. FINDINGS AND RECOMMENDATIONS 49
4.2 : CONCLUSION 51
4.3 : BIBLIOGRAPHY & REFRENCES 52

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 ACKNOWLEDGEMENT

First of all I am really thankful to almighty ALLAH, who gave me the strength to complete degree and
internship in time and without problems.

I am grateful to all my teachers who gave me knowledge and enabled me to use that knowledge into
practical field during my internship.

I am also thankful to staff at MCB, Bank Chattar branch, Muzaffarabad, for being a help in matching my
class room knowledge with practical working processes. Especially the branch manager “Muhammad
Pervaiz Abbasi” and his branch staff. They have really provided me a useful help during my internship
period.

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11
 EXECUTIVE SUMMARY

As a compulsory part of degree of master of commerce, I did my 6 weeks internship in a branch of MCB
Bank Limited, located at Bank Square Chattar Domel, Muzaffarabad AK.

MCB Bank Limited (formally known as Muslim Commercial Bank) is one of the oldest and biggest
banking company of Pakistan with a domestic network of over 1,130 branches and 600 ATMs across
Pakistan with a customer base of 4.5 million (approximately). It was incorporated on July 09, 1947 under
Indian Company Act 1913 and was nationalized in 1974 as part of Government of Pakistan's economic
reform movement and was later privatized to NISHAT Group in 1991. MCB Bank has won various “Euro
money” and “Asia Money” awards as best bank in Asia and Pakistan. 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
and Azad Jammu and Kashmir.

During the period of my internship at MCB Chattar Branch, I did not find any problem in my learning
process. Although there were some limitations but they were manageable. I learned the processes of
remittances, account opening, ATM Card, dealing with information seeking customers, sending and
receiving confirmation mail and different types of letters. I mainly worked in clearing and posting
department most of the period of my internship. I also commented on daily high value transactions of the
branch and prepared KYC forms and different debit and credit vouchers. Financial analysis and SWOT
analysis of MCB are also included in this report. As a whole, it was quite a good and exciting learning and
practical experience because it was my first time to having opportunity of learning in real business world
and other than class room

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13
CHAPTER NO 01
INTRODUCTION TO THE REPORT

1.1 : Introduction:

In this section a brief explanation of purpose of this report, sources and methods
of information gathering, accounting and business techniques used in this report
and limitation of information gathering and accounting and business techniques
will be given.

1.2 : Purpose:

This report is prepared in the result of internship done at a branch of MCB Bank
Limited located at Bank Square Chattar Domel Muzaffarabad AJK. After
completing four semesters of M.COM, a six weeks internship is a necessary part
of the degree at any manufacturing or service organization.
Internship is indeed a first step into practical field and to work in real business
settings. It gives opportunity to use and match the class room knowledge with
practical skills and let the student do the research work himself while observing
and understanding accounting, finance and management system of the
organization. One of the useful objectives of the internship is to work with
business professionals.

1.3 Objective of the study:

The main objective of my study in MCB Bank Limited is to go through from the
theory to practical working also to enhance my management skills. I got many skills
regarding to my field. Detail of the objective include:

 To complete my internship program and prepare the internship report

 To improve my inter-personal skills in the professional environment.
 For improve my communication skills.
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  To identify my own strengths and weaknesses which I ever faced in the practical
environment.
 Enhance my knowledge about the banking sector.
 Discover the ways to treat and satisfied the customer.
 Analyze the banking operation i.e. operational analysis, financial analysis by doing
practical work and applying the theoretical study.
 To learn and improve the time management skills.

1.4 Sources and Methods of Collecting Information:

To make this report various sources of information are used. The most important
sources of information is staff of branch and self-collected data during the course
of internship. Financial statements of MCB, website of MCB, different economic
reports, press releases, articles, business record and different books of the course
are some other names of sources of information used for making this internship
report. Financial statements of MCB are collected from the website of MCB and
different press releases and news reports are taken into consideration in order to
have an understanding of situation of MCB.
Primary Source:
 Personal Observation.
 Discussion with the Bank Clients/Account Holders.
 Discussion with the Bank Personals.
Secondary Source:
 Internet.
 Newspapers and Journals.
 Internship reports which are available in the MCB library.
 Annual Reports.
 Manuals of the Bank.

1.5 : Limitations of Information Gathering:

In large companies like MCB, the access to primary information is a point where
different facts do matter like economic and social position of internee. Secrecy
policies of bank, non-availability of information in a manner required for analysis
are some of the limitations and due to work load on staff of the bank they have very
small amount of time to proper assist. Due to prevailing pandemic situation of
COVID-19 from last year the entire learning process, studies and research work
has badly affected. In the environment of social distancing it seems very hard to
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organize and combine all the resources for achieving the milestone of studies as
well as this project completed.

CHAPTER NO 2
INTRODUCTION TO THE ORGANIZATION
2.1 ABOUT MCB:
This bank was incorporated under companies’ act 1913 on 9th July, 1947 (just
before partition) at Calcutta. But due to changing scenario of the region, the
certificate of incorporation was issued on 17th August, 1948 with a delay of
almost 1 year; the certificate was issued at Chittagong. The first Head office of the
company was established at Dacca and Mr. G.M. Adamjee was appointed its first
chairman. It was incorporated with an authorized capital of Rs. 15 million.

After some time the registered office of the company was shifted to Karachi on
August 23rd, 1956 through a special resolution, now recently the Head office of
MCB has been transferred to Islamabad in July, 1999 and now Head office is
termed as Principle Office.

MCB is reputed as one of the soundest financial institution and as one of the
leading banks in Pakistan with a deposit base of PKR. 1100 billion (approx.) and
total assets of PKR 1550 billion (approx.). The bank is versed as one of the oldest
and most responsible banks in Pakistan and has played pivotal role in representing
the country on global platforms while being one of the few institutions that are
recognized and traded in the international market

2.2 NATIONALIZATION:

In January 1974, the Government of Pakistan nationalized MCB following the

Banks (Nationalization) Act 1974. 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.

2.3 PROVITIZATION:

A wave of economic reforms swept Pakistan in the lattes introducing the Need for
privatization of state owned banks and companies. This was the first bank to be

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privatized in 1991 and the bank was purchased by a consortium of Pakistani
corporate groups led by Nishat Group. Nishat Group is one of the leading and most
diversified business groups in Pakistan. The group has strong presence in the most
important business sectors of the country such as banking, textile, cement and
insurance.

2.4 BOARD OF DIRECTORS:

 Mian Mohammad Mansha Chairman

 Mr. S. M. Muneer Vice-Chairman
 Mr. Muhammad Tariq Rafi Director
 Mian Umer Mansha Director
 Mrs. Iqraa Hassan Mansha Director
 Mr. Muhammad Ali Zeb Director
 Mr. Mohd Suhail Amar Suresh bin Abdullah Director
 Mr. Yahya Saleem Director
 Mr. Salman Khalid Butt Director
 Mr. Masood Ahmed Puri Director
 Mr. Shahzad Hussain Director
 Mr. Shariffuddin bin Khalid Director
 Mr. Imran Maqbool President & CEO

2.5 OTHER INFORMATION:

 Total Branches 1400

 Overseas Branches 11
 Total customers 8.2 Million(2019)
 Profit before Tax 40.1 Billion (2019)
 Profit After Tax 23.98 Billion(2019)
 Staff Strength Above 25000
 Total Deposits 1145 Billion (2019)
 Total Assets 1515 Billion(2019)
 Return on Assets 1.59% (2019)
 Return on Equity 16.84% (2019)
 Total ATMs 1350
 Credit Rating AAA(2019)
 Market Capitalization 243 Billion(2019)
 Principle Office MCB Tower, I.I. Chundrigar Road, Karachi.

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 2.6 VISION STATEMENT:

To be the leading financial services provider, partnering with our customers for a more
prosperous and secure future.
2.7 MISSION STATEMENT:

We are a team of committed professionals, providing innovative and efficient

financial solutions to create and nurture long-term relationships with our customers.
In doing so, we ensure that our shareholders can invest with confidence in us.

2.8 CORE VALUES:

Integrity:

MCB is the trustees of public funds and serve the community with integrity. It
believes in being the best at always doing the right thing. It delivers on its
responsibilities and commitments to its customers as well as its colleagues.

Respect:

MCB respects its customer’s values, beliefs, culture and history. It values the
equality of gender and diversity of experience and education that its employees
bring with them. It creates an environment where each individual is enabled to
succeed.

Excellence:

MCB takes personal responsibility for its role as leaders in the pursuit of
excellence. It is a performance driven, result oriented organization where merit is
the only criterion for reward.

Customer Centricity:

MCB’s customers are at the heart of everything it does. It thrives on the challenge of
understanding their needs and aspirations, both realized and unrealized. It makes every
effort to exceed customer expectations through superior services and solutions.

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 2.9 AWARDS OF MCB:

MCB has been awarded as a Euro Money Award 2008 for the “Best Bank in Asia".

Best Bank in Pakistan Award 2006:

MCB has yet again received the esteemed Euro Money Award for the “Best Bank in
Pakistan”. It is the only bank to receive the Euro Money Award for Excellence for the
sixth time in the past seven years.

Best Bank Award 2005:

MCB has again received the esteemed Euro Money Award for the “Best bank in
Pakistan”. It is the only bank to receive the Euro Money Award for Excellence for the
fifth time in the last six years.

Best Bank Award 2004:

In a continuous winning streak, MCB once again takes pride in being conferred
with Euro Money's prestigious award of excellence, for being the "Best Bank in
Pakistan" for the fourth time in the last five years.

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2.10 ORGANIZATIONAL
SETUP

PROVINCIAL HEAD

KARACHI

PUNJAB LAHORE

SINDH KARACHI

BALOCHISTAN PESHAWAR

QUETTA

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2.11 MANAGEMENT STRUCTURE:

President

Assistants/Clerks

Peon/Guards

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2.12 BRANCH LEVEL HEIRARCHY:

Operations
Department

Remittance

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2.13 MANAGERIEL POLICIES:

At MCB Bank all policies are formulated at the Head Office at Karachi and are
then distributed among the vast network of more than 1400 branches in Pakistan
and Azad Kashmir.

One of the policies they implement is that the Commercial Office – East or West,
keeps in view new opportunity for a suitable and profitable location for its new
branch. But as all policies are done by the HO no suitable information could be
gathered.

Managers handle their staff at branch level. The duties assigned to them are to
keep the monthly deposit up to the mark; opening of new accounts has to be either
stable or increasing.

They are responsible for assigning leaves to their staff on yearly basis and even
handle emergency absence. MCB has a rule of working 9 to 5 daily but, internally
their staff has alternate off on Saturdays. The manager has to develop a leave
program so as this routine does not disturbs any customer.

2.14 PRODUCT AND SERVICES:

2.14.1: Online Services

MCB provides and efficient online services to its customers which are as follows:

2.14.1.1 ATM Services:

MCB ATM Smart Card is accepted at over 1350 ATMs nationwide. MCB ATM Smart
Card enables you to access fast cash, inquire account balance, transfer funds and pay
utility and mobile bills/mobile top-ups from any of over 1350 MCB ATMs in the
country

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 2.14.2 MCB ATM Regular Card:

The MCB ATM Gold Card allows withdrawal up to Rs. 25,000 per day
and a maximum of 6 withdrawals per day per card. The cardholder has to
make at least two transactions to withdraw the full amount of Rs. 25,000.
 Damaged Card:

If card breaks in two or gets distorted, please return the card to MCB
Online branch. Customers can receive new MCB ATM card from
MCB Online branch within a few days.

2.14.3 MCB Mobile:

At the forefront of technological excellence, MCB has proudly introduced MCB
MOBILE. MCB Mobile is a quick, easy and secure way to top up mobile phone
balances, transfer money, pay bills and do so much more. MCB’s globally
recognized and award nominated mobile payments service allows existing
account holders at MCB to conduct both non-financial and financial transactions
such as:

Check account balances

View Mini Statements (last 6 transactions)

Transfer funds to any MCB account

Pay Utility Bill

Pay MCB Visa Credit Card Bills

Recharge MCB Visa Prepaid cards

Pay mobile postpaid bills

2.14.4 UTILITY BILLS PAYMENT:

MCB easy bill pay offers unmatched convenience to pay your utility and mobile
phone bills or re-charge your prepaid mobile phone accounts anywhere, anytime
with security and peace of mind.

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MCB is the only bank that offers you 3 convenient options of making bill
payments to PTCL, SSGC, SNGPL, KESC, Mobil ink, IESCO, HESCO, and
Ufone. So, save your precious time by avoiding long queues and pay your bills
through MCB Easy Bill Pay.

MCB Smart Card or MCB ATM Card Holder can easily pay their bills or re-charge
their prepaid mobile phone account through the following convenient options of
MCB easy bill pay.

o Features:

Pay your bills 24 hours a day 7 days a week.

Make either full or partial payments. Full payment is required

for PTCL only.

2.14.5: Accounts:
MCB offers various types of accounts which are as follow:

2.14.5.1: Basic Banking Account (BBA):

It’s as simple as ABC to start banking with MCB. Looks after your money the
simple way, with MCB Basic Banking Account.

o Key Points:
Open a Basic Banking Account with as little as Rs.1000/- only.
No minimum balance maintenance requirement.
No monthly account maintenance charges.
Two free deposits per month (including cash and clearing).
Two free withdrawals per month (including cash and clearing).
Unlimited free withdrawal transactions through MCB's ATMs.

2.14.5.2: Current Account:

Discover the quick, easy, and convenient way to manage and use your money
with an MCB Current Account.

o Key Points:

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 Low minimum balance requirements.
Unlimited cash deposit and withdrawal facility at hundreds of
branches nationwide.
Use your MCB Smartcard to shop at thousands of merchants
across Pakistan.
Lockers and other affordable transactional facilities.

2.14.5.3: Savings Account:

MCB Savings Account offers you one of the most suitable ways to manage your
hard- earned money. So start saving and earning profit today.

o Key Points:
Low monthly average balance requirements.
Profit paid into your account every six months.
Unlimited cash deposit and withdrawal facility at hundreds of
branches nationwide.

Use your MCB Smartcard to shop at thousands of merchants across Pakistan

and Azad Kashmir.

2.14.5.4: Foreign Currency:

MCB Foreign Currency Account offers you the option of earning attractive
returns on your Foreign Currency Investment.

o Key Points:
Open your account in US Dollar, UK Pound Sterling, or Euro.
Open for as little as US$ 500 or equivalent.
Unlimited transactions at your branch.
Free Foreign Currency cash deposit and withdrawal facility.
Rate of Return directly linked with international market.
Profit paid into your account every six months.
Foreign Remittances facility available.
Countrywide network of Foreign Currency Branches.
Cash withdrawal in PKR equivalent.

2.14.5.5 MCB Smart Business Account:

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MCB Business Account lets you build your business through the accrued savings from
discounted transaction fees, and more conveniently.

o Key Points:
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. Option for automatic

2.14.5.6 Saving 365 Gold:

MCB Savings 365 Gold Account offers you a wide range of attractive profit
rates. The higher you save, the higher you go.

o Key Points:
The higher your balance, the higher your rate.
Profit calculated on daily basis.
Profit paid into your account every month.
Open your account with Rs. 500,000/- only.
Cash deposit and withdrawal facility at hundreds of branches
nationwide.

2.14.5.7: Term & Term Deposit Saving Account:

MCB has designed special term deposit account which offers higher profit rates
over the period of time. This special account is designed for companies,
organization and government departments.
o Key Points:
Highly attractive profit rates.
Multiple tenors from one month onwards.
Option of premature encashment.
Option for ATM debit card to access profit earned.
Option for automatic renewal of term deposits.

2.14.6 Loans:

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 MCB offers variety of loans and finances to its customer all over Pakistan and Azad Jammu
and Kashmir. Major finances are as follows:

2.14.6.1: CAR 4 U:

MCB offers auto loan for which useful for purchasing of new and used cars for personal
use to its customers.

o Flexible:
Option for financing or leasing
Financing tenures from 1 to 7 years
Option for new as well as used cars

o Affordable:
Mark up rate KIBOR+ 2 (Variable)
Lower insurance rates
Minimum 20% down payment
Repayment in monthly installments

o Special Benefits:
No processing fee if the case is declined
Pay your down payment after your loan is approved

o Availability:
All over Pakistan and Azad Kashmir.
2.14.6.2 MCB Credit Cards:

MCB has also designed Credit card which is basically a kind of personal loan. Through
credit card a customer can buy goods from brands nationally and internationally on credit
and pay the amount with in next 40 days without paying any extra amount or interest but
after 40 days bank will charge amount. For this unique feature the Credit card is also called
plastic money.

2.14.6.3: MCB Pyara Ghar:

MCB offers three home financing options for Pyara Ghar. MCB Pyara Ghar provides
flexible and competitive home financing facility with options of home purchase, home
renovation and construction of home at reasonable monthly repayments facility.

2.14.7 MCB Rupee Travelers Cheques

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MCB Rupee Traveler's Cheques were first introduced in 1993 as safe cash for traveling and
travel related purposes. The product has been extremely popular and is preferred over cash by
customers while traveling and in all walks of life.
o Features:
Easily available: Buy them from any of the designated branches in Pakistan.

As good as cash: MCB RTCs are safe to carry for travelers

Easily encashed: At any designated MCB branch.

Easily refunded: in case of loss or theft, you can get the full amount back.

Exclusive security features: Available in denominations of Rs 1000, Rs

5000, Rs 10,000. Validity: 10 years from the date of purchase.

2.14.8 MCB Home Remittance

o MCB brings FAST and FREE Home Remittance service to beneficiaries in
Pakistan. With our large network of over 1400 branches, MCB can deliver your
remittances to every part of Pakistan.

o MCB Pak Cash enables you, the Non Resident Pakistanis, to send money to your
loved ones in Pakistan quickly, easily and conveniently. MCB Home
Remittance Service is FREE and available at all MCB correspondents (Banks/
Money Transfer Cos) Worldwide. For details please see our list available at
Remitter Locator.

o MCB Fast Transfer (Account to Account Transfer):

Same day credit to MCB Account holders

Fast, prompt and hassle free funds transfer
Free of charge
SMS alert for beneficiary (subject to provision of mobile number)
For Non MCB Account holders, funds are transferred online or
via bank draft to any other bank
2.14.9: Ban assurance:
The Bank Insurance Model ('BIM'), also sometimes known as 'Ban assurance', is the term
used to describe the partnership or relationship between a bank and an insurance company
whereby the insurance company uses the bank sales channel in order to sell insurance
products. MCB also provide bank assurance services.

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 o Benefits:
Permanent Total Disability/ Health Insurance
Systematic saving plan like committee.
Complete Surrender/ Partial withdrawal available.
Protection Benefit/ Life Assurance coverage
Flexibility of Choice
Inflation Protection
Additional Top-Ups (Ad-hoc Feature
2.14.10 Agriculture Finances:
MCB also offers agriculture products which are as follow:

2.14.10.1 Shadabi Plan:

Shadabi Plan caters the financing needs for production activities on the farm which mainly
include seed, pesticides and fertilizers along with provisions for miscellaneous expenses
like payment of electricity & diesel bills of tube wells, maintenance expenses for tractors
and the like items as per list of Eligible items.

Features:

 Financing requirement is ascertained for a period of three years

 Limit is sanctioned for three years on revolving basis with one time
documentation subject to annual clean up along with markup.

 Mark up is charged on the limit amount utilized by the farmer

 There is no prepayment penalty

 There is no hidden cost involved

 Forms & documents are provided free of cost.
2.14.10.2 Tractor Financing:

To boost up the mechanized farming in the country, Tractor Finance Scheme is introduced
to offer specialized services to farmers. Under this scheme, there is no requirement of
minimum land holding because of multipurpose use of tractor for agriculture cum
commercial. However, the repayment capacity and potential use of tractor will be evaluated
at the time of loan processing.

2.14.11: Other Services:

Lockers:
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 Basically it is a facility which is provided by the bank to its customers in order to secure
their money gold important property documents etc. before this locker concept people are
very much worried about the loss of their money, gold and important documents so now
the people are very much relax because now they use this facility quite frequently.

2.15 Major Departments at MCB Chattar Branch Muzaffarabad

There are three main departments in MCB chattar branch Muzaffarabad.

2.15.1: General Banking:

General banking deals with following department services:

3.15.1.1: Cash Department:

The following books are maintained in the Cash Department:

 Receiving Cash Book

 Paying Cash Book

 Token Book

 Scroll Book

 Cash Balance Book

2.15.1.2: Remittance Department:

It is transfer of funds. Funds can be transferred in shape of pay orders, demand draft, mail
telegram and telegraph transfer. Payments of fees of different organizations, fulfillment of
tenders, and collection of funds are the main functions of remittance. Maximum part of general
banking depends on this department.

2.14.1.3 Clearing Department:

MCB Bank also provide the services of collection funds from other banks on the behalf of
customers. This is the major function of clearing department to collect money of the customer
from other banks by using State Bank’s Clearing house facility.

Other department include account opening, advances and consumer also play role for smooth
business of the bank.

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CHAPTER NO 03
CHAPTER3-JOBDESCRIPTION& ITS ANALYSIS

3.1 Work Done by Me:

Week wise work done by me is as follows:

3.1.1 : First Week:

In joining week of my internship at MCB Bank Limited, Bank Square Chattar Domail
Muzaffarabad, I worked first 2 days with the branch manager.
He told me about high value transaction and how to comment on it. Explanation of high
value transaction is as follow:

o High Value Transactions:

All those transactions which are of 1 million or above 1 million are

considered as high value transactions. According to the instructions of
SBP, the record of daily high value transactions is kept separately and
then bundled by months and years.

The branch manager has to comment on these transactions. The comment

consists on following 3 parts:

Business of the customer

Nature of the transaction
Know your customer (KYC)

o Clearing at MCB:
MCB collects the cheques of its customers on behalf of them. If you have an account in MCB
and your customer has given you cheque of another bank then you can give this cheque to
MCB and MCB will collect it for you.

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MCB divided cheques into three categories:

Intra City/Local Cheques

Inter City Cheques
Same Day Cheques
Local cheques are those which are within city or with region. These
cheques take usually 2 days in clearing process.

Intercity cheques are those which are of other cities or other regions.
These cheques are sent to their particular cities.

Same day cheques are those which are of within city but these cheques
are stamped as same day and these are passed on same day on which they
are presented.

Some banks like “HBL”, “NBP”, “UBL” passed intercity locally. Charges
for intercity cheques are 250 rupees and local cheques are free. Cheque
return charges are 300.

All cheques are sent via NIFT (National Institutional Facilitation

Technologies). It performs the role of middle man between banks and
state bank. It collects all the cheques from the banks and then sorts them
and makes a list of it and forwards it t SB. After these cheques have been
processed in SB, NIFT’s agent takes it their head office and from where
these cheques are sent to particular destination.

Every Morning Mr. Afzal posts the information of the slips of last days cheques
which are handed over to the NIFT’s agent on MCB’s own developed software
“Branch Teller”. At the closing time of bank when NIFT’s agent come with the
passed cheques and information and dishonored cheques, Mr. Afzal make of
reversal of that posted slip.
Cheques which are of MCB and online fund transfer applications are also stamped
at this seat and handed over to the posting person. A daily sheet of record of local
cheques (account number, cheque number, bank name of cheque and amount) is
made on excel sheet. Inter city and same day cheques are recorded in separate
register.

33
 3.1.2 Second Week:
During whole period of internship, mainly I sat on clearing seat and I indeed
worked on that seat rather than just learning.

My tasks on that seat in second week were as follow:

Receiving and stamping cheques

Sorting them as local and inter city

Making local cheques record in excel

Making inter city record on register

Verification of the working of the day

Printing

One of the works of the my daily routine was commenting on high value, as I had commented
undone work of previous months in last week so now I was enable to do this work easily
because now I know the businesses of the customers

34
 3.1.3 : Third Week:

In third week there were some more tasks added to my clearing work. Now the total
tasks which I was doing at clearing seat were:
 Receiving and stamping cheques

 Sorting them as local and inter city

 Making local cheques record excel

 Making intercity record on register

 Separating cheques and deposits slips

 Putting different necessary stamps on cheques (explained below)

 Preparing covers for inter city cheques (city wise)

 Preparing cover for local cheques

 Receiving passed cheques information and dishonored cheques from NIFT’s

agent

 Attaching slips of dishonored cheques with them

 Informing related parties to dishonored cheques

 Giving dishonored cheques to related parties

Names of Various Stamps which are stamped on cheques are as follow:

 Crossing Stamp (on every cheque)

 Date Stamp (on every cheque)

 Payee’s A/C will be credited on Realization (on every cheque)

 Previous Clearing Stamps Cancelled (on dishonored cheques which

are to be send again)
 Inter city clearing (on inter city cheques)

35
  All our stamps cancelled (for canceling stamps)

Crossing stamp is stamped on every received cheque in order to confirm receiving.

Next day date stamp is stamped on every cheque because cheques will be presented
at next day to particular branches. Payee’s A/C will be credited is also necessary
to mention that the amount of the cheque will be credited to payee’s account when
cheque would be passed.

There is a float of two days in available balance and ledger balance. There for if
any cheque is dishonored then a reversal is made.

If any customer wants to resend dishonored cheques in clearing, then previous

clearing stamp is stamped on those cheques on back side. If any customer wants
to take back his cheque before sending of clearing then crossing stamp is
cancelled by canceling stamp.

In third week I also made KYC forms for customers. These forms are made once
to twice in the year and different things are mentioned on that form like their debit
and credit turnover, nature of their business, their dealing with bank and comment
on future business with the bank.

36
 3.1.4 : Fourth Week:

In fourth week I spend my time to understand other functions in bank along with
my clearing work like:

 Account opening

 Using “branch teller” to check the balances of the customers

 Issue the bank statement of account

 Sending letters to dormant or inactive account holders

 Scanning cheques and e-mailing them to particular branch

 Filling deposit slips and online fund transfer applications.

To open an account, a form is available which is called account opening form. It’s
a form on which different fields are given which is to be filled by customer by
the help of banker. Some common fields are:
 Branch Name & Code (bank square branch code is 0190)

 Type of Account (current, business, profit and loss etc)

 Currency of Account (local or foreign)

 Contact Information

 Category of Account (individual, joint, partnership etc)

 Occupation (business of the customer)

 Operational Instructions (any other able to operate this account)

 Reference

 Know Information
 Specimen Signature Card

 Nadra Verysis and Bio matric Slip

37
 3.1.5 Fifth Week:

In fifth week I did some additional works which are as follow:

 Learned Procedures of Demand Drafts, Pay Orders etc.

 Making Debit & Credit Vouchers For Remittance

 Filling ATM Forms

Demand drafts and pay orders are prepared by clearing person MCB, Bank
Square Branch. Information is entered into “branch teller” and printed on DD
stationary. Demand drafts are made against cash or amount is debited from
account. Rupees 100 are charged as charges against issue of DD by MCB if
amount is up to 100000. For non-account holder it is 200 Rupees. For amount of
more than 100000, charges are 0.1% of the amount and for non-account holders
it is 0.2% of the amount. For pay order charges are charges are 100.

Debit & Credit vouchers are also filled at clearing seat. Instruments are issued by
Global Transaction Banking Branch, Karachi under home remittance scheme or
speed or any other scheme. And it is mentioned on instrument that amount is
payable at which branch. A credit voucher is sent to GTB, Karachi and a debit
voucher is prepared for branch itself.

38
 3.1.6 : Sixth Week:

In sixth week I started sitting with posting person who was responsible for posting
the cheques of MCB from one account to another account. All those cheques
which are of MCB are transferred online by Mr. Noman. Online fund transfer
applications are also posted by this person. Both cheques and applications are
stamped at clearing seat and handed over to Mr. Noman. Difference between
online fund transfer applications and cheques with deposit slips is that cheques
are of other branches which are to be transferred in MCB, Bank Square chattar
branch accounts and online fund transfer applications are used to transfer money
to account of another branch from the MCB, Bank Square.

He first checks the balance in account of cheque and then he makes verification
about signatures, account number and account title from the “branch teller”
software. If the payee party is trusted then he makes the transfer otherwise he
sends the cheques in clearing or sends fax or mail to particular branch of cheque.
He gave me opportunity to post a couple of cheques under his care.

On the other hand I was doing my tasks at clearing seat. I went to head office of
MCB with manager a couple of times where he took import forms. Sometimes I
went with him to different customers for telling bank services and motivating them
to open accounts and make deposits. I commented on high value transactions this
week make some other debit voucher for expense.

3.2 ANALYSIS

3.2.1 STATEMENT OF FINANCIAL POSITION:

39
 Amounts

2022 2022 2023 Favorable/

Un
Favorable
(RS. In 000)
Authorized capital 15000 15000 15000
Paid up capital 11851 11851 11854
Reserves 77591 74148 77591 Favorable
Unappropriated Profit 55777 53532 53776 Favorable
Shareholder's equity 145219 139531 136493
Surplus on revaluation of assets - net of 23695 9747 17073 Favorable
tax
Net Assets 168915 149278 153566 Favorable
Total Assets 1,343,238 1,498,130 1,515,152 Favorable

Earning Assets 1175352 1343378 1294096

Gross Advances 515058 546792 540037
Advances - net of provisions 469356 503581 496679 Favorable
Non-Performing Loans (NPLs 487523 48956 49424
Investments 656964 749369 348756
Total Liabilities 1189672 1348852 1346237 Favorable
Deposits & other accounts 968,483 1,049,038 1,144,763 Favorable
Current & Saving Deposits (CASA) 899,364 954,813 1,035,063 Favorable

Borrowings 133,070 216,019 89,506 Favorable

Interest bearing Liabilities 728,361 867,048 809,717 Favorable
Contingencies and Commitments 448,135 584,434 851,147

Profit before tax ratio 41.86% 38.48% 29.00%

Gross Yield on Average Earning Assets 7.10% 6.41% 10.49% Favorable
Return on equity (ROE) 17.65% 15.48% 16.84% Favorable
Return on assets (ROA) 1.86% 1.50% 1.59% Favorable
Earnings per share (after tax) 19.56 18.02 20.23 Favorable
Dividend Payout ratio 83.14% 88.77% 84.02% Favorable
Price to earning ratio 10.85 10.74 10.13

40
3.2.2 PROFIT AND LOSS:

Amount
2021 2022 2023s Favourable/ Unfavorable
RS. In Million
Mark–up / return / 74,091 83,319 138,292 Favorable
interest earned
Mark–up / return / 31,429 37,305 78,676 Favorable
interest expensed
Fund based income 42,662 46,014 59,616 Favorable

Fee, Commission, 11,435 14,625 14,469

brokerage & FX income
Dividend and capital gains 6,682 2,573 2,210
Total income 60,780 63,212 76,295 Favorable
Operating expenses 28,721 32,902 33,709

Operating profit before tax 32,059 30,310 42,586 Favorable

and provision
Profit before tax 31,014 32,064 40,102 Favorable
Profit after tax 22,459 21,360 23,977 Favorable

Cash Dividends 18,673 18,961 20,146 Favorable

41
3.2.3 Explanation of Results:

If we see towards the specialized ratios of MCB, then we come to know that MCB
has very good earning assets to total assets ratios in recent years. It shows the
efficiency of its management that it is putting its assets to work and making
earnings. The efficiency of the banking firm is measured by its ability to utilize its
assets in a manner that they could be profitable for the firm. Lending, advances,
investments are increasing every year.

There is decrease in balance with other banks and that for there is a little decrease
in the ratio in year 2022.

MCB markup revenue has increased very positively to PKR.139292 Million

against 83319 million in last year which shows the huge growth whereas fee
income has a very minor decline of 156 Million from previous year stood at 14469
Million from 14625 Million in previous year. Profit after tax has grown in 2022
stood at 23977 Million, cash dividends has also increased to 20146 Million
against 18961 million in previous year.

Net margin to earning assets ratio shows the management’s ability to control the
spread between interest income and interest expense. There is mix trend in this
ratio in recent years for MCB. In year 2021, 2022 MCB has some good earning
assets but interest earned was not ideal due to slump period. In year 2023 ratio
had increased.

Bank’s deposit has clocked at 1144763 (1.14 Trillian) which has grown from
1049038 Million from previous year which is very positive sign. MCB bank now
stands among top 4 Banks which achieved 1 Trillion deposit milestone

42
 3.3 SWOT ANALYSIS:

3.3.1 INTERNALANAYLISIS:

3.3.1. STRENGTHS

Long & Strong

Establishment:

MCB has a lot of experience than other private banks plus it has strong financial
background by national group. Now it has a strong brand name for people to trust.

Network of branches:

MCB has a wide network of branches in all over the country plus location of
branches is very good. MCB tries to establish branch at those location where
deposits are highly expected.

Products & Services:

MCB is providing almost all possible banking products and services from
insurance to financing, from agriculture to house schemes, from individual loans
to agency services, from full day banking to online banking even mobile banking
and foreign exchange.

Increasing Trends:

MCB has very good investor and marketability ratios there are increasing trends
in equity, assets, deposits and incomes.

43
 3.3.1.2 Weaknesses:

Employees Dissatisfaction:

Most of the employees in MCB are dissatisfied due to low salaries as compared to same
positions in other banks plus they are not satisfied with incentives given by MCB to them.
They also complain about overload of work that’s why turnover rate at MCB is high.

Effect of Nationalization:

A large number of MCB employees are of that period when MCB was a nationalized bank.
They are now unwilling to present like employees in other private banks. Their attitude is
not much motivating for customers.

Lack of Training & Skills:

There is lack of training and skills in employees. MCB is not paying much attention to
improve the abilities and skills of its employees according to modern banking requirements.

Lack of Advance Marketing and Advertisement:

MCB is one of most powerful banks of Pakistan and it can create more customers by
advertising regularly about its products and services on proper media channels but due to lack
of services MCB is missing this opportunity.

3.3.2 External Analysis

3.3.2.1 Opportunities:

6.1.1 s: Opportunities:

Motivation:

MCB can motivate its customers by spreading information about social and cultural
benefits of adopting its product and services and depositing their money in a bank like
Need of Every Business:

Banking sector is most growing sector of Pakistan and Azad Kashmir. It is

now need of every business. It’s opportunity for MCB to offer products and
 services to every business according to their need. Even it can offer to overseas
customers.

Expanding Investments in Real Estate for better profit.

Banks are normally investing in debts and making money, debts are normally
lower yielding. In Pakistan there is a huge potential in real estate investments.
The returns in these investments are better than investing in debts securities.
Through investing in Real Estate bank can earn huge profits as well as
contribute to GDP growth, employment to labor and development of the
country.

Investments in Agriculture:

Pakistan is an agricultural country but with the passage of time this sector is
not considered by the investors, which can be much beneficial for investor.
The banking sector may add value in this sector through investment in
agriculture sector.

Modernization:

MCB can follow the modernization in banking business. It can avail more modern IT
technology, it can offer micro financing to make low income people into customers, and
it can apply more modern training programs for skills improvement.

45

3.3.2.2 Threats:
Huge Competition:

Banking sector is growing but actually pretty much grown sector in Pakistan.
This attracts businessmen to enter into banking business in Pakistan. Many
private banks have come into establishment in recent years and many foreign
banks have started their branches in Pakistan. They are equipped with latest
banking knowledge and skills as well as modern technology. So MCB has to
compete them with more and more effort.

Current Situation of Pakistan:

o Recent years were not good for Pakistan, because of economic, and
political instability left huge impacts on all businesses where the
government cuts its development expenditure which may resulted
low GDP Growth, Unemployment and lowest investment
mobilization.

o Shortage of energy also indirectly affect banking sector because other

businesses rely on it.

o Pakistan is an Islamic country and people here think that bank

business is not halal so most of the time they avoid it.

Government unfamiliar policies

Government of Pakistan is making is huge borrowings from state bank as well

as from commercial banks. This cause many banks to bankrupt when they have
no actual money to give back to its depositors. Banks are merging into one
another to keep their neck up in water.

47
04 FINDINGS AND RECOMMENDATIONS

4.1 Motivation and Training programs

MCB should apply some serious motivation programs to its employees. Its employees
seem to be dissatisfied from their jobs. They think that they are overloaded with work
and pay is not up to the mark. MCB has to remove the gap between management and
non- management. Proper meetings should be arranged for this purpose, this will
reduce their frustration.

It seem that MCB employees are hunted by lack of training, even they don’t know
properly about major running software called “symbols branch teller”. MCB should
train them as all-rounder bankers that they could perform more and more banking tasks.
MCB should train them with modern banking policies and attitudes and enable them to
run with modern concept of customer relationship. Employees should also be unable
to work on modern machinery and remaining manual procedures should be converted
to computerized systems as early as possible to increase efficiency, following survival
of the fittest. They should be taught the concepts of team work and job rotation.

Using Proper Channels:

MCB should advertise its products and services using all popular and proper
channels like electronic/print and social media. Mere having a website is not
enough plus MCB should consider on advertising its products in easily
understandable way, because pure banking terms are not understand by common
people. People even don’t properly understand English so it is recommended that
spreading should also be in popular languages. It will make ease to build relations
in bank and general public.

Rewards & Promotions:

MCB should reconsider its rewards and promotion policies because their pay is not up to the
mark in comparison of other banks. They should adopt performance based reward system
along with seniority based reward system. This should encourage hard workers. Good
salaries will help in reducing turnover and it will also attract trained professionals
 49

Customer Relationship Management:

MCB has weak customer relationship management policies. It is running on its

brand name and old establishment. There is lack of innovation in MCB. So,
MCB should think about it. It should think that how to secure future and how to
retain and gain customers. In this age of huge competition customer now are
enable to compare the services and products of one bank with another.
Availability of information is also high so there is a strong need for MCB to
improve its customer relationship policies that will help it to secure its future.

Expanding Investments in Real Estate for better profit.

Banks are normally investing in debts and making money, debts are normally
lower yielding. In Pakistan there is a huge potential in real estate investments.
The returns in these investments are better than investing in debts securities.
Through investing in Real Estate bank can earn huge profits as well as
contribute to GDP growth, employment to labor and development of the
country.

Investments in Agriculture:

Pakistan is an agricultural country but with the passage of time this sector is
not considered by the investors, which can be much beneficial for investor.
The banking sector may add value in this sector through investment in
agriculture sector.
 50

4.3 CONCLUSION

At the end of this concluding this report I’m feeling joy that with blessings of
Allah, I finally completed by internship successfully and now I have made a report
on it.

Internship at MCB Bank Limited, Bank Square Chattar Domel, Muzaffarabad AK

was a pleasant experience. Most of the staff there was cooperative and they helped
me in my leanings. I notice working at MCB that most of the MCB branches at
those places where deposits come in huge amount and MCB has advantage of trust
of people that its deposits are increasing every year.

MCB bank has a history as old as Pakistan and it is one of most powerful and
largest banks of Pakistan. Huge number of branches in all over the Pakistan and
largest ATM network plus strong financial and market position and a good brand
name are some of the strengths of MCB. MCB has good financial ratios and
increasing trends in profits, incomes, assets and equity, which shows the ever
improving policies of MCB and thinking about wealth of its stakeholder.

MCB has good future in commercial banking with variety of products and services
and it just need to improve its customer relationship management and it has to
think seriously about Islamic banking plus MCB is facing some serious issues like
high employee turnover because employees at MCB are less satisfied with their
jobs and pays. So MCB has to apply some measures to overcome these problems
as described in recommendation section that modern training and motivations
programs should be applied at MCB.

I think I honestly did all my tasks during internship period which resulted in a very
useful increase in my knowledge, experience and skills. I hope it will help me in
future.

51
REFRENCES AND BIBLIOGRAPHY

managerial Finance By Lawrence J. Gitman

Principles of Marketing By Philip Kotler
http://www.mcb.com.pk/

References:

Altman, E.I. (1968), “Financial ratios, Discriminant analysis and the prediction of
corporate bankruptcy”, Journal of Finance, September, pp. 189-209.

LAWRENCE J. GITMAN (2005) - Principle of Managerial Finance (Eleventh Edition).

Addison-Wesley. ISBN: 9780321267610.

MCB BANK LIMITED (2019) – Company Profile [online]. Retrieved from:

http://www.mcb.com.pk/mcb/about_mcb.asp [Accessed: December 18, 2020].

MCB BANK LIMITED (2018) – Annual Reports [online]. Retrieved from:

http://www.mcb.com.pk/ir/fin_data_rep.asp [Accessed: December 25, 2020].

WEIHRICH, H. (1982) The TOWS Matrix – A tool for situational analysis. Journal of
Long Range Planning, 15.

MUHAMMAD PERVAIZ ABBASI, Branch Manager at MCB Bank Square Branch,

Chattar Domel, Muzaffarabad, Information about high value transactions.

ATTIEQUE UR REHMAN, Officer at MCB Bank Square Branch, Information about

clearing process, demand draft, pay order, posting.

52
Good Bye
102