INTERNSHIP REPORT ON MCB BANK LIMITED

PREPARED BY FAIZA IQBAL BBA (HONS) MORNING

DEPARTMENT OF MANAGEMENT SCIENCES

Internship Report

2011

Practice makes a man perfect. Theoretical knowledge is not enough on its own. It is useful when implemented. Thats why it is necessary for completion of BBA program to do practical work. Internship program is also held in every management institution to support the same purpose. Banking plays very important role in the development of commerce and economic fields of a country. As banks are using different modern and up to date technologies in order to perform well and influence different managerial activities, it is a better option for business students to get internship experience in banks. I did five weeks internship in MCB BANK Model Town Branch, Bahawalpur. During this time I visited different departments and was thoroughly briefed about the procedures and working by friendly senior staff of there. In preparation of this Report I have tried my best to provide all possible information about the operations, functions and tasks of MCB in brief and comprehensive form. It also includes a brief view of what I did during internship. Internship report ends with some recommendations and concluding remarks after identification of problems that I observed during internship. Although I have put all my efforts but surely there are chances for mistakes, suggestions are welcomed.

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I offer my foremost and humblest thanks to ALMIGHTY ALLAH, The most Beneficent, the Most Considerate and the entire source of all knowledge and wisdom. I thank ALMIGHTY ALLAH, who gave me the aptitude to prepare this Internship report efficiently and successfully. With prayers of my parents and support of my teachers it became possible for me to formulate this report; I pay high regards to them. The account of acknowledgement will be incomplete if I do not express my appreciation to the staff of MCB Model Town branch Bahawalpur, as they guided me and assisted me to perform different productive activities during the entire period I am also thankful to my friends and other family members who were always there to encourage and help me design this report to its present form.

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I dedicate my entire efforts to my DEAR PARENTS who pray for me every single minute and guide me at every step of life whenever I feel difficulty. I dedicate this report to my dear sister AYESHA IQBAL who always supports me and prove to be helpful for me in any kind of circumstances. I dedicate this report to RESPECTED STAFF of MCB Model Town Branch, Bahawalpur as well, as everyone guided me and helped me whenever I needed during whole internship and made me learn many new things.

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EXECUTIVE SUMMARY ............................................................................................................................. 9 1 1 0 . INTRODUCTION OF BANKS ............................................................................................................ 1 2. BRIEF HISTORY OF BANKING IN 2 PAKISTAN .............................................................................. 2. Nationalization of1 2 1 Banks ..................................................................................................................... 1 5 3. INTRODUCTION OF MCB BANK LIMITED ....................................................................................... 1 4. VISION, MISSION AND VALUES OF MCB 7 BANK............................................................................. 1 4. 7 1 Vision .................................................................................................................................................. 4. Mission ............................................................................................................................................... 1 2 . 7 4. Values ................................................................................................................................................ 1 3 .. 7 5. 1 OBJECTIVES ........................................................................................................................................... 8 6. BUSINESS STRATEGY OF 1 MCB .......................................................................................................... 9 7. ORGANIZATIONAL2 STRUCTURE ...................................................................................................... 0 7. Branch Organizational 2 1 Structure ......................................................................................................... 1 8. CORPORATE2 PROFILE .......................................................................................................................... 2 9. PRODUCTS AND2 SERVICES................................................................................................................. 6 Current 2 9. 1 Account .................................................................................................................................. 6 9. Savings 2 2 Account .................................................................................................................................. 6 Term 2 9. 3 Deposit ....................................................................................................................................... 6 9.4 MCB Online 2 Banking.......................................................................................................................... 7 2 9.5 MCB MNET........................................................................................................................................ 7 9.6 MCB Cash 2 Management ..................................................................................................................... 7 MCB Channel2 9. 7 Financing ..................................................................................................................... 7 9.8 MCB Local Rupee Drawing 2 Arrangement .......................................................................................... 7 9.9 MCB Home 2 Remittance ...................................................................................................................... 7

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9.10 MCB Corporate Financing........................................................................................................28 9.11 MCB Project & Structured Finance............................................................................................28 9.12 MCB Syndicated Loans and Debt Capital Markets.......................................................................28 9.13 MCB Quasi Equity/Hybrid Instruments.......................................................................................28 9.14 MCB Equity Capital Raising.....................................................................................................28 9.15 MCB Advisory Services............................................................................................................28 9.16 MCB Islamic Banking..............................................................................................................28 9.17 MCB Agri Products..................................................................................................................29 9.18 MCB Privilege.........................................................................................................................29 9.19 MCB Salary Club.....................................................................................................................29 9.20 MCB Investment Services.........................................................................................................29 9.21 MCB Visa Credit Card..............................................................................................................29 9.22 MCB Car4U............................................................................................................................30 9.23 MCB Instant Finance................................................................................................................30 9.24 MCB Smart Card.....................................................................................................................30 9.25 MCB Rupee Travelers Cheque...................................................................................................30 9.26 MCB ATMs............................................................................................................................30 9.27 MCB Mobile ATM...................................................................................................................30 9.28 MCB Lockers..........................................................................................................................31 9 29 MCB SMS Banking..................................................................................................................31 9.30 MCB Full-Day Banking............................................................................................................31 9.31 MCB Bancassurance.................................................................................................................31 9.32 MCB Call Centre.....................................................................................................................31 9.33 MCB Mobile...........................................................................................................................31 9.34 MCB Virtual Banking...............................................................................................................32 10. WORKING OF VARIOUS DIVISIONS AND DEPARTMENTS.......................................................32

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10.1 Customer Services Department..................................................................................................32 10.2 Clearing..................................................................................................................................33 10.2.1 Outward clearing...............................................................................................................33 10.2.2 In ward Clearing................................................................................................................33 10.2.3 Same day clearing..............................................................................................................34 10.2.4 Normal clearing.................................................................................................................34 10.2.5 Intercity clearing................................................................................................................34 10.2.6 NIFT- National Institutional Facilitation Technologies...........................................................34 10.3 Remittances.............................................................................................................................35 10.3.1 Demand Draft....................................................................................................................36 10.3.2 Payment Order..................................................................................................................37 10.3.3 Telegraphic Transfer..........................................................................................................38
10.3.4 Rupee Travelers Cheques...............................................................................................38

10.4 Forex Department....................................................................................................................39

10.4.1 FTT..................................................................................................................................40

10.4.2 Swift operations.................................................................................................................40 10.4.3 Export finances..................................................................................................................40 10.4.4 Export refinance................................................................................................................41 10.4.5 Letter of credit...................................................................................................................42 11. SWOT ANALYSIS.......................................................................................................................44 11.1 Strengths.................................................................................................................................44 11.2 Weaknesses.............................................................................................................................45 11.3 Opportunities...........................................................................................................................46
11.4 Threats....................................................................................................................................47

12. FINANCIAL ANALYSIS..............................................................................................................48 12.1 CURRENT RATIO..............................................................................................................49

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12.2

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QUICK RATIO.....................................................................................................................50

12.3
12.4

NET WORKING CAPITAL (Rs. In 000s)..............................................................................51

DEBT RATIO......................................................................................................................52

12.5 12.6 12.7 12.8 12.9 12.10 12.11 12.12 12.13 12.14 12.15 12.16 12.17 12.18

TIMES INTEREST EARNED RATIO...................................................................................53 EARNINGS PER SHARE (Rs.)............................................................................................54 RETURN ON AVERAGE ASSETS (ROA)............................................................................55 RETURN ON AVERAGE EQUITY (ROE)............................................................................56 MARKET CAPITALIZATION (In Rs. Million)......................................................................57 DIVIDEND YIELD RATIO (based on cash dividend).............................................................58 DIVIDEND PAYOUT RATIO.............................................................................................59 EARNING ASSET TO TOTAL ASSET RATIO (Rs. In Million).............................................60 RETURN ON EARNING ASSETS.......................................................................................61 INTEREST MARGIN TO AVERAGE EARNING ASSETS...................................................62 AVERAGE EQUITY TO TOTAL ASSETS..........................................................................63 DEPOSITS TIMES CAPITAL............................................................................................64 LOANS TO DEPOSITS RATIO.........................................................................................65 GROSS ADVANCES TO DEPOSITS RATIO.....................................................................66

13. SUGGESTIONS AND RECOMMENDATIONS...............................................................................67 14. CONCLUSION.............................................................................................................................69 15. REFERENCES.............................................................................................................................80

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Internship Report EXECUTIVE SUMMARY

2011

MCB Bank Limited (Formerly Muslim Commercial Bank Limited) has a solid foundation of over 50 years in Pakistan, with a network of over 1100 branches, over 500 MCB ATMs nationwide and a network of banks on the MNET ATM Switch. MCB's operations continued to be streamlined with focus on rationalization of expenses, re alignment of back-end processing to increase productivity, enhancement of customer service standards, process efficiency and controls. The Bank has taken the lead in introducing the innovative concept of centralizing Trade Services in the country by providing centralized foreign trade services to branches with a view to improve efficiency, expertise and reduce delivery cost. During my internship in MCB I mainly worked in Remittances and Customer Service Office department, I also took information about Forex department by spending a week there and I successfully completed all the task/duties that were assigned to me.
During the course of internship I learned about different functions performed by Remittances, Foreign Exchange and Customer Service Office department and by the bank as a whole. I also learnt banks correspondence with their customers and within branches. I learnt about documentation requirements and record keeping for different activities and processes, especially the documentation required for different kinds of remittance i.e., pay order and demand draft.

This report includes the introduction of Banking, Banking in Pakistan, the brief history of MCB Bank Limited, mission and vision of MCB Bank, its products, awards, corporate profile, organizational structure, working of various divisions and departments including the tasks performed by the intern, SWOT and financial analysis and finally ends with recommendations and conclusion.

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Internship Report 1. INTRODUCTION OF BANKS

2011

History of bank is as old as human society. Forever since man came to realize the importance of money as medium of exchange, the necessity of a controlling or regulating agency or institution was naturally felt. The work BANK is derived from the word BANCUS or BANQUE which means a bench. Other authorities hold the opinion the word BANK is derived from the German word BACK which means joint stock fund. Later on, when the Germans occupied major part of Italy, the word BACK was Italianized into BANK. Modern banking system was introduced into the Muslim countries at a time when they were politically and economically at low ebb, in the late 19th century. The main banks in the home countries of the imperial powers established local branches in the capitals of the subject countries and they catered mainly to the import export requirements of the foreign businesses. The banks were generally confined to the capital cities and the local population remained largely untouched
by the banking system. The local trading community avoided the foreign banks both for

patriotic as well as religious reasons. However, as time went on it became difficult to engage in trade and other activities without making use of commercial banks. Even then many confined their involvement to transaction activities such as current accounts and money transfers. Borrowing from the banks and depositing their savings with the bank were strictly avoided in order to keep away from dealing in interest which is prohibited by religion. However with the passage of time and other socio-economic forces demanding more involvement in national economic and financial activities, avoiding the interaction with the banks became impossible. Local banks were established on the same lines as the interest- based foreign banks for want of another system and they began to expand within the country bringing the banking system to more local people. As countries became independent the need to engage in banking activities became unavoidable and urgent. Governments, businesses and individuals began to transact business with the banks, with or without liking it. This state of affairs drew the attention and concern of Muslim intellectuals. The story of interest-free or Islamic banking begins here. In the following paragraphs we will trace this story to date and examine how far and how successfully their concerns have been addressed.

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Internship Report
What is bank?

2011

There are many definitions of the word "bank". Even the standard encyclopedia and law books find it difficult to state exactly what a bank is. There have been many attempts by different writers to explain the exact definition of the term bank. Here some of the definitions are quoted as follows. According to Negotiable Instruments Act (1881): Bank is an institution transecting the business of accepting, for the purpose of lending or investment, of deposits of money from the public repayable on demand or otherwise and withdraw able by cheques, draft order or otherwise and includes any post office saving bank According to Banking Companies Ordinance 1962: Banking means the accepting for the purpose of lending or investing of deposits of money from the public repayable in demand or otherwise and withdraw able by cheques, draft, order or otherwise. According to Kent: An organization whose principle operations are concerned with the accumulation of the temporarily idle money of the general public for the purpose of advancing to others for expenditures. According to Dr. Harts: A banker is one who in the ordinary course of his business, receives money which he repays by honoring cheques of persons from whom or on whose account he received it. So the comprehensive definition of bank is: A bank is a financial institution, which deals with money and credit. It accepts deposits from individuals, firm and companies at a lower rate of interest and gives at a higher rate of interest those who need them. The difference between the terms at which it borrows and those at which it lends from the source is its profit. A bank, thus, is a profit earning institution.

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2. BRIEF HISTORY OF BANKING IN PAKISTAN

Pakistan came into being on 14th August, 1947; sufficient banking services were available in the areas forming Pakistan. Out of the total branches of the nearly 3,500 in the undivided India, as many as about 1,500 branches were existing in these areas. It was agreed between the two countries that reserve bank of India shall continue to function in the Pakistan territory until 30th September 1948 and that Indian notes would continue to be legal tender at Pakistan until 30th September 1948. Unfortunately, relationship between the two countries became most strained i m mediatelyafterindependence;bankingwasmostlyinthehandsofHi n d u s w h o i m m e d i a t e l y s t a r t e d transferring their offices and assets into India. As a result most of the banks in Pakistan were closed down and even those which were open were not doing any effective business. The number of banking office in Pakistan came down to about 200 on 30th June 1948. Branches of some European banks were also functioning in a limited manner, financing in export of crops, and their number was limited to about 20. It was only the Habib bank, which transferred its office from Bombay to Karachi. Australasia bank was another bank, which was in existence in the Pakistan territory at the time of independence. Despite of best efforts on the part of government of Pakistan, no heady way could be made on this behalf and reserve bank of India was in no mood to help the new country. Imperial bank of India, agent of the Reserve bank of India also started closing down its branches in Pakistan. Reserve bank also refused to advance money to Pakistan to make essential payments such as salaries etc.; also
Pakistans share of Rs.75 billion in cash balance was withheld by bank, causing hardships to the

newly born state. In view of these hopeless state affairs it was agreed between the two countries that Reserve bank would serve as monetary authority in Pakistan only up to 30th June 1948.

2.1 Nationalization of Banks

The government nationalized all Pakistani banks on January 1, 1974. The principle of nationalization of banks was to stream line the operations of commercial banks in such a way that it may be conductive to the development activities in process in the country. Since the commercial banks were owned and controlled by big business groups of the country it was feared that these banks would not maintain uniformity in their operations and would be instrumental to inflationary pressure. However, the considerations behind nationalization are:

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1. To form uniformity in the policy of the commercial banks so they may serve the best national interest. 2 . To make the operation of commercial banks highly sensitive and responsive to the policy of the government relation to financial matters. 3. To make the credit policy of the commercial banks more purpose full and effective especially in the development of economic sectors of the country. It acts as an agent of the State Bank of Pakistan 4. To make the best use of the funds available at the disposal of these banks for the economic development of the country. 5. To eliminate unhealthy and uneconomic competition among commercial banks. 6. To develop strong money market in the country so that the value of currency may be maintained at stable level both in national facilities to exporter and agriculturists which have not been satisfactory in the past years.

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Internship Report 3. INTRODUCTION OF MCB BANK LIMITED

2011

MCB bank limited with more than 60 years of experience as one of the leading banks in Pakistan, was incorporated on July 9 in 1947. The bank has journeyed remarkable tenure of more than half a century of competitively edged and well positioned heights of success by deploying quality banking, heads on technological developments, professionally leading management and prudent and ethical work methodologies. MCB was nationalized along with other private banks in 1974 as part of Government of Pakistan's economic reform movement and was later privatized to Nishat Group lead consortium in 1991. Since privatization, MCB's growth has been phenomenal. Today, MCB in one of the largest foreign banks in Sri Lanka, the first bank in Pakistan to launch Global Depository Receipts (GDR) in 2006, has strategic foreign partnership with Maybank of Malaysia which holds 20% shares in MCB through its wholly owned subsidiary Mayban International Trust (Labuan) Berhad since 2008, has international indirect regional presence in Dubai (UAE), Bahrain, Azerbaijan, Hong Kong and Sri Lanka and serving through a domestic network of over 1,130 branches and 600 ATMs across Pakistan with a customer base of 4.5 million (apprx.) MCB is reputed as one of the most sound financial institution and as one of the leading banks in Pakistan with a deposit base of PKR. 462 bln (apprx.) and total assets of PKR 605 bln (apprx.). 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. The bank has also been acknowledged though prestigious recognition and awards by Euromoney, MMT, Asia Money, SAFA (SAARC), The Asset and The Asian Banker.

Awards
2010 The Asian Banker: Strongest Bank in Pakistan 2010 The Asian Banker: Leadership Achievement Award 2010 MMT: Best Bank Led MMT Service 2010 ICAP / ICMAP: BCR Award 2009-Banking Sector

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2010 SAFA: Certificate of Merit Award 2009 Asiamoney: Best Domestic Bank in Pakistan 2009 The Asset: Best Domestic Bank in Pakistan 2008 Euromoney: Best Bank in Asia 2008 Euromoney: Best Bank in Pakistan 2008 Asiamoney: Best Domestic Bank in Pakistan 2006 Asiamoney: Best Domestic Bank in Pakistan 2006 Euromoney: Best Bank in Pakistan 2005 Asiamoney: Best Domestic Bank in Pakistan 2005 Euromoney: Best Bank in Pakistan 2004 Euromoney: Best Bank in Pakistan 2004 Asiamoney: Best Domestic Bank in Pakistan 2003 Euromoney: Best Bank in Pakistan 2001 Euromoney: Best Bank in Pakistan 2000 Euromoney: Best Bank in Pakistan

2011

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Internship Report 4. VISION, MISSION AND VALUES OF MCB BANK

4.1 Vision
To be the leading financial services provider, partnering with our customers for a more prosperous and secure future

2011

4.2 Mission
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

4.3 Values
The standards and principles which determine our behavior and how we interact with our customers and each other Integrity We are the trustees of public funds and serve our community with integrity. We believe in being the best at always doing the right thing. We deliver on our responsibilities and commitments to our customers as well as our colleagues. Innovation We encourage and reward people who challenge the status quo and think beyond the boundaries of the conventional. Our teams work together for the smooth and efficient implementation of ideas and initiatives. Excellence We take personal responsibility for our role as leaders in pursuit of excellence. We are a performance driven, result oriented organization where merit is the only criterion for reward. Customer Centricity Our customers are at the heart of everything we do. We thrive on the challenge of understanding their needs and aspirations, both realized and unrealized. We make every effort to exceed customer expectations through superior services and solutions. Respect We respect our customers values, beliefs, culture and history. We value the equality of gender and diversity of experience and education that our employees bring with them. We create an environment where each individual is enabled to succeed.

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Internship Report 5. OBJECTIVES

2011

0 Delivering remarkable returns to stakeholders, sustainable performance, exceeding market and shareholder expectations. 0 Providing value added services through operational expansion, geography and upgraded systems. 0 Building a corporate culture of equality, trust and team spirit as we remain dedicated to be a socially responsible organization.

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6. BUSINESS STRATEGY OF MCB

The business strategy of MCB is to provide financial solutions to major segments of its customer base, namely retail and corporate. Separate business groups have been set up to ensure a more focused approach in satisfying the diversified customer segments. The Bank has also established an Islamic Banking unit to offer Shariah compliant products and services, with dedicated Islamic banking branches in six cities. The plan for future is to further realize the capacity of Islamic Financial Systems and to bring Shariah compliant network parallel to current retail network of traditional banking.
Wholesale Banking Group caters to the top tier local and multinational companies. As a result of organizational restructuring, including reinvigorating Investment Banking and beefing up relationship teams, the Group is in line with the industrys best practices. MCB has closed some

large deals and is currently working on a number of large transactions including advisory business. It is a strong competitor in cash management and structured financing activities. Retail Banking Group focuses on trading and middle market segment primarily for building risk assets and trade related business. MCB caters to their needs of financing foreign and local trade, funds transfer and other seasonal requirements. The Bank has renovated a large number of branches and staff has been trained for meeting the requirements of SMEs and other retail customers. A separate SME Financing Division has been set up to provide customized financing solutions to this very important segment of the economy. The Group also focuses on the development of innovative consumer asset products for satisfying the personal needs of the customers. MCB has a significant share of consumer financing business with its House and Car Financing schemes. The recently launched running financing facility against the mortgage of property is also expected to go a long way in increasing the quality consumer credit portfolio of the bank. With the experience gained in the past few years, the Bank is fast progressing towards becoming the leading bank in consumer business.

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Internship Report 7. ORGANIZATIONAL STRUCTURE

2011

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Internship Report 7.1 Branch Organizational Structure

Given is the organizational structure of MCB MODEL TOWN Branch, BAHAWALPUR.

2011

Branch Manager

Operations Manager

Trade Manager

Credit Manager

Customer Service Officer

General Banking Officer

Cashier Credit Incharge

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Internship Report 8. CORPORATE PROFILE

Board of Directors Mian Mohammad Mansha Chairman Mr. S. M. Muneer Mr. Tariq Rafi Mr. Shahzad Saleem Mr. Sarmad Amin Dr. Muhammad Yaqub Dato' Mohammed Hussein Mian Raza Mansha Mr. Aftab Ahmad Khan Mian Umer Mansha Dato' Seri Ismail Shahudin Mr. Manzar Mushtaq Mr. M.U.A. Usmani Vice Chairman Director Director Director Director Director Director Director Director Director Director President / CEO

2011

Management Committee Mr. Ali Munir Mr. Agha Saeed Khan Mr. Azfar Alam Nomani Mr. Imran Maqbool Mr. Kamran Zaffar Muggo

Strategic Planning and Investment Operations Compliance Commercial Branch Banking Group Audit & Risk Assessment Review

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Mr. Laqa Sarwar Mr. Muhtashim Ashai Mr. Muhammad Nauman Chughtai Mr. Salman Zafar Siddiqi Mr. Ahmed Kareem Mr. Mohammad Ramzan Mr. Ali Kazmi Special Assets Management Wholesale & Investment Banking Credit Risk Review

2011

Chief Financial Officer Human Resources Treasury Head Consumer Banking

Audit Committee Mr. Tariq Rafi Dr. Muhammad Yaqub Dato' Mohammed Hussein Mr. Aftab Ahmad Khan Dato' Seri Ismail Shahudin

Chairman Member Member Member Member

Human Resources Committee Mian Mohammad Mansha Chairman Dr. Muhammad Yaqub Mian Raza Mansha Mr. Shahzad Saleemn President / CEO Member Member Member Member

Risk Management & Portfolio Review Committee Mian Umer Mansha Chairman Page 23

Internship Report
Mr. Sarmad Amin Mr. Manzar Mushtaq President / CEO Member Member Member

2011

Committee on Physical Planning, IT System & Contingency Arrangements Mr. Sarmad Amin Chairman Mr. S. M. Muneer Mr. Tariq Rafi Mian Umar Mansha President / CEO Member Member Member Member

Business Strategy & Development Committee Mian Mohammad Mansha Chairman Mr. S. M. Muneer Mr. Shahzad Saleem Dr. Muhammad Yaqub Dato' Mohammad Hussein Mian Raza Mansha Mian Umer Mansha Dato Seri Ismail Shahudin President / CEO Member Member Member Member Member Member Member Member

SBP Report Compliance Monitoring Committee Mr. S.M. Muneer Chairman Mr. Shahzad Saleem Member

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Mr. Sarmad Amin Dr. Muhammad Yaqub President / CEO Member Member Member

2011

IT Committee Mian Raza Mansha Mr. Tariq Rafi Mr. Aftab Ahmad Khan President / CEO

Chairman Member Member Member

Write Off & Waiver Committee Mian Muhammad Mansha Chairman Mr. Tariq Rafi Mr. Aftab Ahmad Khan Chief Financial Officer Mr.Salman Zafar Siddiqi Member Member

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Internship Report 9. PRODUCTS AND SERVICES

2011

In order to achieve long-term goals of expansion and penetration in the market MCB bank introduced various new products for its customers, which cater to the needs of various segments of the society. In order to do so, a constant process of market research, 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. 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.

9.1 Current Account

MCB Bank offers a variety of current accounts to cater to the everyday transactional needs of various customers. These accounts ensure ease and freedom to bank from any of the 1100+ branches across the country. The different accounts include: the Basic Banking Account that has no minimum balance; Business Account offering free online transactions, Demand Drafts, Pay Orders and lots more to meet the day to day business requirements; Current Life Account which offers the security of life insurance free of cost; and for all others, the conventional Current Account.

9.2 Savings Account

MCB Bank offers a wide array of savings products that suit short term growth & transactional needs. Our savings accounts offer attractive profit rates as well as flexibility to transact. Savings Xtra is targeted for customers having Rs. 5 million + deposit, 365 Gold offers profit rate on daily balance while PLS savings has a lower minimum balance requirement. In addition, two unique products: Smart Savings and Savings Maximizer are special saving accounts run solely via debit cards and other remote banking channels, offering a very competitive rate to both high and low end savers.

9.3 Term Deposit

MCB Term Deposit offer attractive short to mid-term investment options with flexibility, convenience and security. With various tenor options available, customers can choose one that suit their needs. This is combined with different profit payout options and the added facility of being able to avail credit facility against their deposits.

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9.4 MCB Online Banking

2011

MCB has a fast growing network of 1100+ online branches in the country providing customers real-time online transaction facilities.

9.5 MCB MNET

MNET is an electronic inter-bank connectivity platform for online transactions on ATM and other remote banking channels. It offers other value added services that include a portfolio of e-banking and payment system products as well as management and day-to-day operations of the same. Members include 10 local and foreign financial institutions enjoying ATM sharing and value added services.

9.6 MCB Cash Management

Cash Management provides a wide range of value added services to large corporations through its vast network of online branches. Our structured and customized products enable our customers to realize their sales proceeds swiftly from all over the country, supported by real-time MIS. Cash Management also provides payment solutions through MCB network and through third parties and customized solutions for dividend payouts.

9.7 MCB Channel Financing

MCB Channel Financing provides working capital facilities to dealers and vendors of selected companies under a structured product program. This product enables our customer's dealers to leverage themselves and increase their business capacity with their respective business partners.

9.8 MCB Local Rupee Drawing Arrangement

Transaction Banking Department at MCB, provides Local Rupee Drawing Arrangement, a product for small banks and financial institutions to use our vast branch network platform to make payments in areas where their own branch network does not exist, thus extending their reach nationwide.

9.9 MCB Home Remittance

MCB Home Remittance provides a seamless inflow of foreign remittances credited in the beneficiary's account within minutes. Cash payments can also be made at our designated branches on behalf of XpressMoney, Samba (SpeedCashNow), MoneyGram and Maybank Money Express Malaysia, along with cash payments from other correspondents from all over the world under the brand name of MCB Fast & Easy.

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9.10 MCB Corporate Financing

2011

MCB Corporate Financing provides access to diversified financing options, including working capital loans, term loans, trade finance services and investment banking.

9.11 MCB Project & Structured Finance

MCB Project & Structured Finance involves financing complex projects, usually in an SPV structure, where the loan is tightly structured around the cash flows, risks are allocated amongst various stakeholders, and there is limited or no recourse to the sponsors.

9.12 MCB Syndicated Loans and Debt Capital Markets

MCB Syndicated Loans and Debt Capital Markets involve arrangement, underwriting and placement services for significant financing requirements by large corporate and institutional clients to other financial institutions or through the debt capital markets.

9.13 MCB Quasi Equity/Hybrid Instruments

MCB Quasi Equity/Hybrid Instruments structure and place a category of debt that has some characteristics of equity such as being unsecured, subordinated or with a potential equity upside.

9.14 MCB Equity Capital Raising

MCB Equity Capital Raising relates to raising capital for our clients by offering common or preferred equity to public or private investors, through initial public offers, offers for sale, rights issues and private equity placements.

9.15 MCB Advisory Services

Financial and Capital Raising Advisory provides our clients with financial advisory services, commercial structuring support and access to capital resources to help companies successfully finance their business/project.

9.16 MCB Islamic Banking

With the help of Shariah specialists, lawyers and professional commercial bankers, MCB Islamic Banking provides Riba Free and Shariah Compliant products and services both on the liability and asset side of the statement of financial position to various customers of all demographic segments with its presence in a growing number of cities. MCB's Islamic Banking products are available to cater the need of Working Capital, Capital Expenditures, International/Local trade and consumer's requirements.

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9.17 MCB Agri Products

2011

MCB is committed to the farming community to support their national objectives of selfsufficiency & food security to the people of Pakistan. Dedicated and specialized staff, supervised by the Agri Credit Division, is posted in lending branches to cater for strong business relationships & facilitation. The bank's extensive branch network in all the provinces and diversified product range extends our reach of agri credit facilities to farmers engaged in any type of activity, encompassing both crop & non crop sectors. We overwhelmingly cherish and stay committed to support the farmers in view of unparallel significance of agri sector in our national life aligned with economic priorities of the country and role of our bank as a responsible corporate citizen.

9.18 MCB Privilege

A first from a local bank, MCB Privilege through its dedicated, world class Privilege Centers offers a higher level of personalized services, more rewarding in-branch experiences and a wide array of deposit and investment products that are tailored to meet the financial expectations of our affluent clientele. As members of MCB Privilege, customers experience unparalleled advantages that put them ahead of others. MCB's dedicated Privilege Centers await to welcome you in Karachi, Lahore, Islamabad and Multan, with plans to expand to more locations.

9.19 MCB Salary Club

A payroll solution designed to make life easy; it simplifies all the monthly payroll related banking needs of employers and opens the door to a world of special offers for employees. Salary Club provides the convenience of having an extensive range of financial services available to employees at their place of work.

9.20 MCB Investment Services

Make the most of your wealth with investment opportunities that match your unique financial aspirations. MCB Investment Services offer distribution of mutual funds managed by the leading fund managers of Pakistan. We can suggest the products most suited for your needs, or work with you to create a personalized solution completely focused on your expectations of the capital markets.

9.21 MCB Visa Credit Card

MCB offers a complete suite of Classic, Gold and Platinum Visa Credit Cards

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focusing on providing, superior services, travel privileges & shopping pleasure. It also offers comprehensive insurance & installment plans, reward points and SMS alerts that give a different feel to the world of credit cards. These unique features include i-revolve, which makes variable mark-up rate available to customers allowing them to repay at affordable rates.

9.22 MCB Car4U

MCB Car4U not only gets you a car of your own choice but is also affordable with competitive mark-up, flexible conditions, easy processing and above all, no hidden costs.

9.23 MCB Instant Finance

With MCB Instant Finance, you can get a loan instantly at any MCB branch against liquid collateral at competitive pricing.

9.24 MCB Smart Card

MCB Smart Card opens the opportunity to have access to your funds via multiple banking channels. It enables you to withdraw cash from ATMs across Pakistan and around the world, transfer funds, pay utility and mobile bills and register for mobile and virtual banking services.

9.25 MCB Rupee Travelers Cheque

MCB Rupee Travelers Cheque is the best and safest alternate way of carrying cash. It can be used by travelers, businessmen or by the general public in meeting their day to day cash requirements while they travel. It is a safe and secure way to make payments because it gives the purchaser security that even if the cheque is lost it can be refunded. Unlike other modes of fund/remittance transfer which can only be drawn at a particular branch and can be encashed only at that branch, MCB Rupee Travelers Cheque can be encashed at any of our branches across the nation.

9.26 MCB ATMs

MCB has one of the nation's largest ATM networks with 500 ATMs covering 110 cities across the country and still growing. MCB ATMs give you a 24-hours convenience of cash withdrawal, mini-statement, utility bill payments, mobile top-ups, funds transfer services and much more.

9.27 MCB Mobile ATM

Through our MCB Mobile ATM we allow for convenient world class banking services. Our Page 30

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innovative MCB Mobile ATM van ensures that we offer our services wherever you are, be it concerts, fairs or any other occasion/special event.

9.28 MCB Lockers

MCB Lockers are the best protection for your valuables. Lockers of different capacities are available nationwide.

9 29 MCB SMS Banking

With MCB SMS Banking, you can bank on your fingertips. Once you're registered onto the service you can SMS anytime to get account information.

9.30 MCB Full-Day Banking

Enjoy the convenience of extended banking hours from 9am to 5pm, including Saturdays at MCB Full-Day Banking branches across the country.

9.31 MCB Bancassurance

Combining the best of banking and insurance solutions, MCB Bancassurance has created a onestop shop for all your financial and insurance needs. Whether you want to save for your child's education or marriage, for the security of dignity after retirement or gaining maximum return on savings, MCB Bancassurance has a plan for you. You can also buy instant insurance coverage through your mobile without any medical assessment.

9.32 MCB Call Centre

The simplest way to bank is with the new enhanced 24/7 MCB Call Centre, which blends innovation and convenience to provide banking services that go beyond expectations. MCB Call Centre enables you to manage your VISA Credit & ATM/Debit Cards, confirm account balances & view last 5 transactions, pay utility/mobile phone & MCB Visa Credit Card bills, top- up your mobile, transfer money within MCB network accounts and register complaints. Most importantly it provides you with our very own banking consultant to discuss your financial needs and requirements. Simply call at 111-000-622 and we'll do the rest.

9.33 MCB Mobile

MCB Mobile is a quick easy and secure way to recharge mobile phones, transfer money, pay bills and do much more. Visit the nearest MCB ATM or call 111-000-622 to register and logon to www.mcbmobile.com using your mobile phone to start transacting. Page 31

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9.34 MCB Virtual Banking

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MCB Virtual Banking Service is a convenient way to access your account(s) 24/7. It is secure, free of cost and lets you do your banking whenever and wherever. This service allows you to transfer funds, pay utility/mobile bills, set up standing order instruction, download account statement and much more.

10. WORKING OF VARIOUS DIVISIONS AND DEPARTMENTS

This section is based on the details of the various departments at the concerned branch. In MCB Model Town branch, following departments are found working. 1. Customer Services 2. Clearing 3. Remittance 4. Forex 5. Advances 6. Assurance Brief discretion of departments is given under where I have performed.

10.1 Customer Services Department

I spent almost a week at customer services desk. All the necessary activities to better serve the customers are performed here. At this desk, I learnt to first of all behave well with the customers as these are the biggest asset of organization in this world of neck to neck competition. Different functions that are performed at CS desk include filling the deposits slips for customers, filling the vouchers for remittance purpose i.e. DD, PO, online money transfer etc. Moreover the account opening form is also filled at this desk by the customers, checque requisition slip for acquiring cheque books, ATM application form, reactivation of dormant account form are also filled at this desk. Few activities including Account opening, account closing, and reactivation of dormant accounts are performed in collaboration with operations department at MCB Model Town branch, because these include the use of computer network by Operations Manager. General help and

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guidance is provided to customers relating their problems. Any sort of information regarding any issue or product is provided at this desk. I learnt all these things in very friendly and stress free environment. It was a good experience spending time at this desk. I observed that the behavior of customer service officers is very good and appreciable with customers that is a source of satisfaction for customers and is helpful in increasing goodwill of bank and generating a positive word of mouth.

10.2 Clearing
Fund transfer between two banks and branches via checques is called clearing. There are mainly two types of clearing: 0 Outward clearing 0Inward clearing

10.2.1 Outward clearing

Outward clearing is to send the cheques to other banks. When the account holder of our bank receives payment from any other party in the form of cheque, and that cheque is not of our bank or branch, and our account holder deposits it in his MCB account then that cheque has to pass from the process of outward clearing. All the cheques deposited in one day of other banks are then sent through the NIFT to the SBP which sends them to the head offices of their respective banks which through NIFT sends the instruments to the respective branches from which they were issued either if they are passed or held to be bounce. This process of outward clearing is exactly opposite to the process of inward clearing.

10.2.2 In ward Clearing

In the morning time banker receives the inward clearing from the NIFT employee and counts the instruments which are received and match it with the summary which is also attached with these instruments. Then banker posts these instruments, either by himself or hand over those to computer operator. After posting all these instruments, they are manually entered in the clearing sheet in its Debit side. There are other three types of clearing: Page 33

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1. Same day clearing 2. Normal clearing 3. Intercity clearing

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10.2.3 Same day clearing

In same day clearing cheque is sent in the morning and payment is received in evening. Same day clearing involve two conditions: 0Cheque will be of Rs. 500000 or above (although it is not strictly followed). 0Bank should be the member of the same day.

10.2.4 Normal clearing

In normal clearing cheque is sent in present day and payment is received next day. No condition is imposed in normal clearing.

10.2.5 Intercity clearing

There is the new concept of clearing which is named as intercity clearing. Clearing between two cities is called intercity clearing. In intercity clearing cheque is cleared in two or three days. State Bank of Pakistan has revised his policies and introduced this concept, in which cheques are cleared that are of banks or branches located in other cities. To understand the process of clearing we first need to understand and comprehend the workings and the purpose of the state banks institution called NIFT.

10.2.6 NIFT- National Institutional Facilitation Technologies

In the process of clearing NIFT plays a very important role. NIFT (National Institutional
Facilitation Technologies) has a very vital role as it is the middle man in the process of clearing.

This institution performs the duties of receiving all the clearing cheques from all the branches of all the banks and taking them to the State Bank. At the SBP, first the NIFT forms a list of all the cheques from all the banks and then forwards it to the SBP representative. That person categorizes all these cheques according to their respective banks and branches and forms another list of his own. Then these sorted cheques are again given to the NIFT agent and he then takes them to the head offices of their respective banks and from there they are distributed to the respective

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branches also through NIFT. This way NIFT delivers back all the cheques to their parent branch from which they have been issued. FLOW CHART OF WORKING OF NIFT

Memo on Returned Cheques Also prepare the Memo on (S.F 16) in which the details of objections are given that for purpose we return this instrument, and charge RS 200/- per instrument for cheque presented for outward clearing and Rs. 300/- per instrument for cheque presented for inward clearing. Calculate the Difference Vouchers of Clearing Difference voucher means the difference between the Out ward Clearing and In Ward Clearing. 0 if liabilities are outstanding on MCB side then made Credit voucher 0If liabilities are outstanding are on their side then made Debit Voucher

103Remittances
This section covers the services and products that Bank offers to its customers for Funds Transfer. Currently Bank is offering following Products & Services for Fund Transfer: (Locally & Internationally).

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0 Payment Order 0 Demand Draft (Local & Foreign Currency) 0 Telegraphic Transfer (Local & Foreign Currency) 0Rupee Travelers Cheques 0 Mail Transfer (Local Currency)

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10.3.1 Demand Draft

Features: Demand Draft is a written order. Drawn by one branch of a Bank upon another branch of the same Bank, or upon other Bank to pay a certain sum of money to or to the order of a specified person. It is issued by one branch of a bank and payable by another branch of the same bank or another bank 0 Demand Draft is a negotiable instrument. 0 Demand Draft is neither issued payable to bearer nor drawn on branches situated within the same city. 0 Legal provisions as to crossing, endorsement, collection and payment in due course are similar to those as for cheques and other negotiable instruments. 0 It is to be ensured that the purchaser of Demand Draft is able to at least sign his name. 0 Thumb impression is not to be accepted on Funds Transfer Application except in cases where purchaser is maintaining an account with the issuing branch. A person unable to sign and not having an account may be advised to apply for the DD through a literate person to sign on his behalf.

Parties involved in the Demand Draft

1. Purchaser: Is the person, firm, company or local authority. 2. Issuing or Drawing Branch: The Branch which issues a Draft on another Branch. 3. Drawee Branch: Is the Branch on which a draft is drawn. 4. Payee / Beneficiary

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Process is represented with the help of figure given below:

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Remitter

Draft

Beneficiary

Fund received Draft

Issuing Branch

Drawee Branch

10.3.2 Payment Order

Payment Order is used for making payments within a city. Literal definition of Payment Order is as follows: A Pay Order is a written authorization for payment, made in a cheque form issued and payable by the bank, to the person named and addressed therein on his giving a proper discharge thereon. Features: 0 It is issued by and drawn upon and payable by the same branch of the bank. 0 It is neither transferable nor negotiable and as such it is payable to the payee named therein.

Parties involved in the Pay Order

Purchaser: Purchaser is a person, firm, company, Government/Semi Government Organization or local authority. Issuing/Paying Branch: This issues/pays on presentation of the instrument.

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Payee: Payee is the person named on a bill to whom, or to whose order, payment is to be made. Where a bill is not payable to bearer, the payee must be named or otherwise indicated therein with reasonable certainly.

10.3.3 Telegraphic Transfer

Transfer of funds from one branch to another branch of the same bank or upon other Bank under special arrangements for the payments to the Beneficiary through Telephone, Fax is called Telegraphic Transfer (TT). Features: 0 TT is not negotiable 0 The funds remitted by TT are not payable to bearer/ order but only to the payee. 0 TT of funds to a branch situated within the same city should not be affected. 0 Remittance can be made for credit of the account of the Payee /Beneficiary if account is maintained. With the Drawee branch or may be paid in cash, subject to proper identification or may be collected by the payee through his baker according to instructions. Such instructions for payment are called Advise and Pay.

Parties of TT Remittance:
1) Applicant: one who wants of remit funds from one branch to another branch of other city. 2) Remitting or Drawing Branch: which remits the fund on another branch. 3) Drawee Branch: on which a TT is issued 4) Beneficiary / Payee: the person named in the TT to whom the fund is payable.

10.34Rupee Travelers Cheques

MCB Bank has been at the forefront of providing its customers with new and innovative products and financial instruments that are safe, secure and profitable.

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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 travelling and in all walks of life. Features: 0 Easily available: Buy them from any of the designated branches in Pakistan. 0As good as cash: MCB RTCs are safe to carry and can be used without any inconvenience especially by Travellers. 0More than 900 MCB Authorized branches are selling and purchasing Cheques all over Pakistan. 0Easily encashed: At any designated MCB branch. 0Easily refunded: in case of loss or theft, you can get the full amount back. 0Customer Service Facility: (021) 111-000-123. 0Validity: 10 years from the date of purchase. 0Denominations: Available in denominations of Rs 1000, Rs 5000, Rs 10,000.

104Forex Department
Forex department at MCB deals in the followings: 0LCs (Letter of Credit) 0FTT 15 Inward FTT 15 Outward FTT 0Swift Operations 0Export finances 15 IBP (Inland Bill Purchase) 15 FBP (Foreign Bill Purchase) 15 FAFB (Finance Against Foreign Bill) Page 39

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Export Refinance

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10.4.1 FTT
FTT stands for Foreign Telegraphic Transfer. All dealings are done in foreign currency. There are two types of FTT i.e. outward FTT and inward FTT. In outward FTT, accountholder sends out the money from Pakistan. In inward FTT, accountholder sends money from abroad to Pakistan. For FTT, request is sent to COD (centralized Operations Division) which allows the further processing. Moreover FTT returns are reported to State Bank of Pakistan on monthly basis.

10.4.2 Swift operations

An international swift code is owned by each bank. All types of interaction are done between banks using those swift codes.

10.4.3 Export finances

1) IBP: Inland Bill Purchase In Inland Bill Purchase, sale contract is executed by between two parties within the country. Local currency is used for payment. Process is represented by the following figure:

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2) FBP: Foreign Bill Purchase In Foreign Bill Purchase, sale contract is executed by between two parties not within the same country. Foreign currency is used for payment. Moreover FBP contains letter of credit (LC). Discounting rate is offered to the customers. 3) FAFB: Finance Against Foreign Bill There is simple sale contract and not LC in FAFB. Bank is not responsible for any action of both parties. Parties with their own mutual understanding execute the sale contract. Bank is only used as a mode of payment. Note: In the concerned branch only IBP is in practice because the area of Bahawalpur is not of industrial nature.

10.4.4 Export refinance

To facilitate and compensate exporters, finance is offered to them. There are two parts in export refinance, part I and part II.

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PART I:

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In part I, simple sale contract is executed between two parties before shipment. Contract documents are shown by the exporter to his bank in order to be facilitated with the finance. After taking money from the bank, the exporter prepares the shipment order received from the importer. Sale contract sometimes may not execute in the first part. PART II: Part II is further divided into two parts i.e. 1) Pre shipment 2) post shipment

10.45Letter of credit

Buyer

Seller or Exporter

or Importer

His Bank

His Bank

Importers bank will issue the letter of credit to the exporters bank, providing assurance about the

payment of shipment so that the exporter will deliver the shipment to the importer. After shipment is sent, exporter will hand over all the related documents to his bank. The bank will send those
documents to the importers bank after receiving payment made by bank. The importers bank will

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inform importer that shipment is reached, pay the money, get documents from us, go and receive your shipment.

10.4.5.1 Parties to letter of credit

In documentary credit operations, the maximum numbers of parties involved are as under. i) The Applicant (Opener of L/C): Applicant means the party on whose request the credit is issued ii) Issuing Bank (Opening Bank): Issuing bank means the bank that issues a credit at the request of an applicant or on its own behalf. iii) Advising Bank: Advising bank means the bank that advises the credit at the request of the issuing bank iv) Beneficiary (Seller or Exporter): Beneficiary means the party in whose favour a credit is issued (Article-2 of UCP-600). v) Confirming Bank: Confirming bank means the bank that adds its confirmation to a credit upon the issuing banks authorization or request. vi) Negotiating Bank: Negotiation means the purchase by the nominated bank of drafts (drawn on a bank other than the nominated bank) and/or documents under the complying presentation, by advancing or agreeing to advance funds to the beneficiary on or before the banking day on which reimbursement is due to the nominated bank. The bank that makes negotiation is called Negotiating Bank. vii) Reimbursing Bank: Reimbursing Bank is the Bank, which on behalf of the opening Bank honours the reimbursement claim lodged by the negotiating Bank.

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Internship Report 11. SWOT ANALYSIS

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11.1 Strengths
0It is mainly operated by Mansha's group, a very renowned industrial group in Pakistan. MCB is working in Pakistan from very past as it has over 60 years of excellence and success. MCB Bank comes under the category of one of the largest domestic commercial banks. It has a good brand image in an Islamic country because of word "Muslim" in the name. 0Overall performance of bank is increasing day by day. MCB is largest private bank in Pakistan with around 1130 branches, which cover almost every area of Pakistan. All the branches are online. 0At present it has near about 600 ATM branches in Pakistan representing the largest ATM network in the country. IT infrastructure and network of online branches is very efficient. The launch of MCB switch allows other banks to utilize MCB's ATM network. MCB is also

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offering GPRS enabled banking. By introducing mobile banking, internet banking etc. it is meeting global and latest technological changes. 0It is a customer bank of more than 4.5 million customers. Strong customer relationship is another strengthening factor for the bank. Wide variety of services is offered by the bank to its customers. Customer default rate is lower as compared to other banks. Moreover MCB has captured majority of potential customers in Pakistan. It has above 10,000 employees. The bank has efficient and experienced management involved in decision making and bringing significant changes. MCB bank has strong culture and has professional and committed employees. Huge sums of money are invested on Human Resource development and training. 0MCB is Market oriented bank. To attract greater market, banks major focus is on developing new and innovative products. Another major strength of MCB is that it has very stable deposit base. The bank is enjoying strong competitive advantage over other banks in Pakistan and strong competitive profitability in the industry as well. 0MCB has the accounts of big organizations like OGDCL, PTCL, EFU, PTC etc.

112Weaknesses
0Although Employees are professional and committed, they are not much satisfied with their job. This dissatisfaction is mainly caused by ill treatment and improper reward system. Promotions are not offered frequently. Employee turnover rate is high because there lacks loyalty among employees. To give everyone equal protocol is lacking among employees. 0Although staff is proficient but unwilling to serve better during audit due to extreme pressure put by the auditors. As most of the employees are young they have more tendencies to switch the organization in order to seek better opportunities, to prohibit this thing high motivation is required which is not dominant in MCB i.e. there is low motivation level. 0Customers face problem of NADRA verification while opening their accounts because its process is time consuming and inefficient.

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0Customers having account with small amounts are not given same services like dealing to others who have high accounts of high amounts so we can sau there is partiality in customer dealing. 0Lack of decentralization. Banks is planning to restructure its departments and is going to be centralized very soon. Decision making process is very slow. 0Partiality and favoritism is seen in recruitment.
0 Though ATM network is the largest in Pakistan, still some potential areas dont have the

ATM. 0 MCB RTC is useable only in Pakistan. 0Less efficiency of SYMBOL System due to dis connectivity.

113Opportunities
0As MCB is currently increasing its operations in global environment, there are chances for its full globalization. 0Because of rapid growth of technology at international level, there are better opportunities for bank to move towards improved technology usage, this can help MCB serve its customers better, anytime and anywhere. 0Increase in Islamic banking operations can attract a good customer range for MCB which will enhance the market share of the bank. 0Offering customized and innovative products e.g. car financing, home financing has helped bank secure a good range of loyal customer, being source of positive word of mouth. 0There are more opportunities to open branches in rural areas so as to increase its branch network and operations. 0Frequent training sessions, free and fair promotions, better reward system can make employees more committed to their work and dedicated to MCB. 0Providing Agri finance facility to farmers has opened new doors of success and a new way to build remarkable customer relationship for MCB. Page 46

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0Announcing new loan schemes on regular basis can better meet customer requirements. 0Continuous growth in leasing sector in Pakistan from past few years provides an opportunity for MCB to grow in this area.

11.4 Threats
0Global economic crisis has affected all the economies and financial sectors a lot, MCB is not out of its range. People are losing their trust in banks. 0In Pakistan, political system is highly unstable being a threat for MCB. Instability of Govt. and govt. policies is another point to worry about by MCB. 0War against terror in Pakistan and neighboring countries is the greatest threat of this time to the whole economy and banking sector of Pakistan. 0Continuously rising competition in banking sector is one of the major threats for MCB. 0Establishment of many foreign banks in Pakistan is very threatening for all local banks including MCB. The market share is mainly influenced by this phenomenon. 0Market saturation, poor law and order situation, mergers and acquisitions in banking sectors, involvement of foreign banks in foreign trade prove to be major threats for MCB. 0Other private, commercial banks with sound profitability i.e. HBL, NBP are also a risk for MCB.

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Internship Report 12. FINANCIAL ANALYSIS

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Financial analysis (also referred to as financial statement analysis or accounting analysis) refers to an assessment of the viability, stability and profitability of a business.

Following are the ratios calculated (in order to do financial analysis) which represent the financial position of the organization.

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