INTERNSHIP REPORT

ON
MCB BANK LIMITED

Specialization: Accounting & Finance

Department of Business & Commerce

Submitted to: Qasim Nasim Mir

Submitted By: Shahzad Jamil
Roll #: 211350009

Date of Submission: 25/10/2024

GIFT UNIVERSITY GUJRANWALA

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 DEDICATION

I would like to dedicate this accomplishment offline to my beloved and caring parents and
to my teachers with the support of whom I am standing at this step of my life stairs.

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 ACKNOWLEDGEMENT

In the name of ALLAH, the most kind and most merciful.

First of all I’m grateful to ALLAH ALMIGHTY, who bestowed me with health, abilities and guidance to
complete the project in a successful manner, and without His help I was unable to perform this task.
Secondly, I want to thank my Parents & Teachers who help me to learn how to live life, how to compete others
& how to face problems. Because of their precious efforts I have reached at this level.
I also want to thank my all staff members who teach me about practical life, guide me that what is banking,
what is the purpose of a bank and what a banker do, and for providing me an opportunity to have an excellent
learning experience during my internship.
I specially thank to;
 Mr. Muhammad Hamid (Branch Manager)
 Mr. Bilal Asghar (Branch Relationship Manager)
 Mr. Kamran Butt (Branch Sales officer)

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Table of Contents
ACKNOWLEDGEMENT .............................................................................................................. 3
Introduction .................................................................................................................................... 5
OBJECTIVES ................................................................................................................................ 6
1. OVERVIEW OF THE ORGANIZATION............................................................................................. 7
1.1. BRIEF HISTORY OF THE ORGANIZATION........................................................ 7
1.2 NATURE OF THE ORGANIZATION .................................................................................. 11
1.3. BUSINESS VOLUME ........................................................................................................... 13
1.4 NUMBER OF EMPLOYEES ................................................................................................ 18
1.5 PRODUCT & SERVICES ..................................................................................................... 23
1.5.1 MCB CORPORATE FINANCING......................................................................... 23
1.5.2 MCB RETAIL BANKING...................................................................................... 24
1.5.3 MCB INVESTMENT BANKING .......................................................................... 31
1.5.4 MCB AGRICULTURE PRODUCTS ..................................................................... 33
1.5.5. VIRTUAL BANKING ........................................................................................... 36
1.5.6 ISLAMIC BANKING ............................................................................................. 37
1.5.7 PRIVILEGE BANKING ......................................................................................... 39
1.5.8 OTHER SERVICES ................................................................................................ 39
2. ORGANIZATIONAL STRUCTURE .................................................................................................. 41
2.2 ORGANIZATIONAL STRUCTURE OF THE BRANCH ..................................... 44
2.4 DEPARTMENTS OF THE MCB .......................................................................................... 53
3. CRITICAL ANALYSIS OF THEORETICAL CONCEPTS RELATING TO PRACTICAL
EXPERIENCES ..................................................................................................................... 60
4.3 RATIO ANALYSIS ............................................................................................................... 66
YEARS 2019 2020 2021 2022 2023 .............................................................................. 88
4. WEAKNESSES OF THE ORGANIZATION........................................................................ 98
5. Overview of the Department(s) Where You Served Internship ............................................. 99
 Functions and operations........................................................................................................ 99
 Weaknesses: ........................................................................................................................... 99
7. CONCLUSION .................................................................................................................... 101
8. RECOMMENDATIONS...................................................................................................... 103
9. ANNEXES ........................................................................................................................... 106
10. REFERENCES ..................................................................................................................... 108

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 Introduction

MCB is one of the leading banks of Pakistan incorporated in 1947 MCB Bank has made
significant contributions in building and strengthening both corporate and retail banking
sector in Pakistan.

This report is an upshot of my eight weeks internship in Muslim Commercial Bank of

Pakistan. MCB of Pakistan possesses an imperative and historical importance in the banking
sector of Pakistan. It always remains the center of hustles in business activities. It always
endows with great covenant of rally round in terms of funds and services at all epochs of its
dynamism.

The main purpose of internship is to learn, by working in practical environment and to apply
the knowledge acquired, during the studies, in a real world scenario in order to tackle the
problems. In this report the detailed analysis of the organization has been done and all the
financial, technical, managerial and strategic aspects have been evaluated to analyze the
current position of the organization. Along with it, the background analysis, the prevailing
competition analysis, the business process analysis, and the internal environment and
external environment of the organization have been discussed and the recommendations &
suggestions for the improvement have been made wherever required. During my eight
weeks internship program, I mainly worked with the following departments:

GENERAL BANKING, CREDIT and FOREX, These departments have been discussed in
detail and all the policies and procedures have been described thoroughly.

This report will provide a complete and clear image about Muslim Commercial Bank.

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 OBJECTIVES

This internship offers me an incredible opportunity to gain real-world experience in

the high-stakes finance industry. The primary objective of the project is to forecast or
determine the actual financial status and performance of an organization

Following are important objectives of studying the organization:

 To learn about Capital Adequacy, Asset and Liability Management,

Interest Rate Risk , Liquidity, Asset Quality & Profitability of bank.
 Analyzing savings and investment trends in banking sector.

 To examine the Innovations in customer service in banking.

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1. OVERVIEW OF THE ORGANIZATION

1.1. BRIEF HISTORY OF THE ORGANIZATION

The history of MCB can be divided into four main Phases:

 Development Phase
 Nationalization Phase
 Privatization Phase
 Present Position of MCB

1.1.1 DEVLOPMENT PHASE

MCB Bank Limited was incorporated by the Adamjee Group on July 9, 1947, under the
Indian Companies Act, VII of 1913 as a limited company. The bank was established with a
view to provide banking facilities to the business community of the South Asia. After the
partition of the Indo-Pak subcontinent, the bank moved to Dhaka (then the capital of former
East Pakistan) from where it commenced business in August 1948. In 1956, the bank
transferred its registered office to Karachi, Where the head office is presently located. Thus,
the bank inherits a 64 years legacy of trust of its customers and the citizens of Pakistan.
MCB Bank is not an overnight success story. It started with a share capital of Rs 30 million
which is divided into 3 million ordinary shares of Rs 10 each.

1.1.2 NATIONALIZATION PHASE

The 1960s decade is stated as the golden era in Pakistan’s economic and financial
development. The banking sector also registered noticeable growth during that period and
lent a strong helping hand to the government to achieve rapid economic growth of the
country. But in early 1970s this scenario changed altogether. The separation of East Pakistan

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(Now Bangladesh) and induction of the government led by Zulfiqar Ali Bhutto were the
most significant events of early 70s having far reaching effects on the banking system.

In the wake of rapidly changing conditions of the country, the government decided to
nationalize all the commercial banks so that the nation as a whole can benefit from a better
use of resources. Consequently, the Muslim Commercial Bank was nationalized under the
Banks (Nationalization) Act, 1974 promulgated on January 1, 1974.

In the banking sector, the then government decided to retain only five major banks by
merging all the smaller banks with the large ones. As a result of this policy, the Premier
Bank was merged into Muslim Commercial Bank in 1974.

1.1.3 PRIVITIZATION PHASE

This was the first bank to be privatized in 1991 and the bank was purchased by a consortium
of Pakistani corporate groups led by Nishat Group.

The banks after nationalization came under political and bureaucratic control and deviated
from normal banking practices. Some of their senior executives were tempted to nurture a
culture of obliging big businessmen, feudal and political influential. They sacrificed their
personal integrity and interest of banking sector for gaining promotion and accumulating
personal wealth. That is how banking sector started losing its upright and professional
institutional image from mid-80s and its downward slide started which touched new low
during 1990s.

The then PML government also became conscious of the falling standard of the banking
sector and decided to privatize all the commercial banks. Banks (Nationalization) (Second
Amendment) Ordinance 1991 was also promulgated to pave the way for privatization of
banks in Pakistan.

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In the wake of above amendments, 26% shares valuing Rs. 149.8 millions of the Muslim
Commercial Bank, held by the State Bank of Pakistan were sold and the Bank’s
management was transferred to the purchasers of these 26% shares.

Mian Mohammad Mansha is the Chairman of the MCB and has played instrumental role in
its success.

1.1.4 PRESENT POSITION OF MCB

MCB has significant contributions in building & strengthening both corporate and retail
banking sector in Pakistan. MCB Bank Ltd in 2019 delivered a profit before tax of Rs. 23.2
Billion registering a growth of 6% over last year. This growth is directly attributable to an
increase of 14% in CASA deposits, 21% in revenues and a tight control on expense base
enabling to retain position as one of the most profitable banks in the country.

In 2019, MCB delivered a superior return on equity of 27.4% and assets crossed the Rs. 500
Billion mark. This performance is all the more remarkable keeping in view the economic &
political challenges faced by the country during this past year and miscreant created issues
that MCB specifically grappled with for a large part of the year. MCB fundamental belief is
that a financial services company can only succeed if it meets its customers’ needs. If they
can understand customer’s financial objectives and offer them the right products and
services so that they can be financially successful, then MCB Bank will continue to build on
its leadership position and provide requisite returns to its shareholders. During 2019, MCB
took several initiatives that brought even closer to their customers. With the launch of MCB
Privilege, MCB became the first local bank to offer a dedicated proposition for the affluent
segment; to meet the growth and protection needs of customers, we introduced
Bancassurance and Investment Products in many of our branches; to enhance transactional
convenience for customers, MCB became the first Pakistani bank to launch mobile banking.
These coupled with several other initiatives enabled us to continue on the path of growing
customer base and profitability. Last year, to expand and reach customer proposition, MCB
also reached an agreement with RBS Pakistan to acquire their business. Unfortunately, the

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deal did not go through but bank continue to invest organically to further strengthen
businesses.

1.1.5 AWARDS & ACHIEVEMENTS

2021 MMT Award: World’s Best Mobile Money Transfer Bank

2020 Asiamoney: Best Domestic Bank in Pakistan

2018 The Asset: Best Domestic Bank in Pakistan

2017 Euromoney: Best Bank in Asia

2016 Euromoney: Best Bank in Pakistan

2016 Asiamoney: Best Domestic Bank in Pakistan

2015 Asiamoney: Best Domestic Bank in Pakistan

2015 Euromoney: Best Bank in Pakistan

2014 Asiamoney: Best Domestic Bank in Pakistan

2015 Euromoney: Best Bank in Pakistan

2013 Euromoney: Best Bank in Pakistan

2013 Asiamoney: Best Domestic Bank in Pakistan

2012 Euromoney: Best Bank in Pakistan

2011 Euromoney: Best Bank in Pakistan

2019 Euromoney: Best Bank in Pakistan

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 1.2 NATURE OF THE ORGANIZATION
MCB Bank Limited is a banking company incorporated in Pakistan and is engaged in
commercial banking and related services. The Bank’s ordinary shares are listed on all the stock
exchanges in Pakistan whereas it’s Global Depository Receipts (GDRs) representing two
ordinary shares are traded on the International Order Book (IOB) system of the London
Stock Exchange.
MCB Bank Limited is a Pakistan-based company. The Bank operates in four business
segments:

 Corporate finance
 Trading and sales
 Retail and consumer banking
 Commercial banking

1.2.1. CORPORATE FINANCE

Corporate finance includes underwriting, securitization, investment banking, syndications;

initial public offerings (IPO) related activities (excluding investments) and secondary
private placements.

1.2.2 TRADING & SALES

Trading & sales segment includes fixed income, equity, foreign exchange commodities,
lending’s to financial institutions and brokerage debt.

1.2.3 RETAIL & CONSUMER BANKING

Retail & consumer banking includes retail lending and deposits, banking services, private
lending and deposits, banking services and retail offered to its retail customers and small and
medium enterprises.

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1.2.4. COMMERCIAL BANKING

Commercial banking segment includes project finance, export finance, trade finance,
leasing, lending, guarantees and bills of exchange relating to its corporate customers.

MCB is one of the leading banks of Pakistan. Its deposit base of Rs. 368 Billion and total
assets over Rs.500 Billion. MCB soon earned the reputation of a solid and conservative
financial institution managed by expatriate executives. In 1974, MCB was nationalized
along with all other private sector banks. The Bank has a customer base of approximately 4
million, a nationwide distribution network of over 1,000 branches and over 450 ATMs in the
market

During the last fifteen years, the Bank has concentrated on growth through improving
service quality, investment in technology and people, utilizing its extensive branch network,
developing a large and stable deposit base

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 1.3. BUSINESS VOLUME
Business volume in terms of Deposit, Advances and Revenue investments for the last five
year as under:

1.3.1 REVENUE

Particulars 2019 2020 2021 2023 2024

------------Rupees in 000--------------

Mark-up / return / 51,616,007 40,043,824 31,786,595 25,778,061 17,756,232

interest earned
Fee, commission and 3,331,856 2,953,394 2,634,610 2,311,235 2,448,950
brokerage
Income
Dividend 459,741 617,554 632,300 811,801 480,344
Income from dealing 341,402 727,564 693,408 692,010 531,455
in foreign
Currencies
Gain on sale of 773,768 740,429 1,500,865 605,865 851
securities
Other income 736,118 855,697 567,213 570,505 1,084,576
Total Revenue 57,258,892 45,938,462 37,814,991 30,769,477 22,302,499

Revenue Trend
60,000,000.00
50,000,000.00
40,000,000.00
30,000,000.00
20,000,000.00
10,000,000.00
0.00
2019 2020 2021 2022 2023

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1.3.2 DEPOSITS

Particulars 2019 2020 2021 2023 2024

-----------------Rupees in 000----------------

Customers

Fixed deposits 626,515,531 61,680,332 32,202,230 33,297,203 13,293,121

saving deposits 173,797,078 150,927,938 151,555,718 136,872,384 13,7067,311

Current Accounts
123,898,324 105,310,862 95,966,877 81,658,304 74,331,042
Non-Remunerative

2,910,655 3,137,434 2,589,309 2,447,944 2,568,306

Margin Accounts

Total Customers 363,257,588 321,056,566 282,314,134 254,275,835 227,262,780

Deposits

Financial Institutions

Remunerative deposits 2,258,295 5,197,969 9,233,602 249,506 183,338

Non-remunerative
2,088,061 3,926,526 546,042 2,932,161 1,857,664
deposits

Total Financial
Institutions 4,346,356 9,124,495 9,779,644 3,181,667 2,041,002
Deposits

Total Deposits 367,603,944 330,181,061 292,093,778 257,457,502 229,303,782

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 Deposits
400,000,000
350,000,000
300,000,000
250,000,000
200,000,000
DEPOSITS
150,000,000
100,000,000
50,000,000
0
2019 2020 2021 2022 2023

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1.3.3 ADVANCES

Particulars 2019 2020 2021 2023 2024

---------Rupees in 000---------

Total Advances 253,249,407 262,135,470 218,960,598 198,239,155 180,322,753

Advances
300,000,000

250,000,000

200,000,000

150,000,000
Advances

100,000,000

50,000,000

0
2019 2020 2021 2022 2023

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1.3.4 INVESTMENTS

Particulars 2019 2020 2021 2023 2024

---------Rupees in 000---------

Investment-net 167,134,465 96,631,874 113,089,261 63,486,316 69,481,487

Investments
180,000,000

160,000,000

140,000,000

120,000,000

100,000,000

80,000,000 Investments

60,000,000

40,000,000

20,000,000

0
2019 2020 2021 2022 2023

Data Sources: Annual Reports of MCB

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 1.4 NUMBER OF EMPLOYEES

1.4.1 BOARD OF DIRECTORS

Mian Mohammad Mansha Chairman

S. M. Muneer Vice Chairman
Mr.Tariq Rafi Director
MR. Shahzad Saleem Director
Mr. Sarmad Amin Director
Dr. Muhammad Yaqub Director
Dato’ Mohammed Hussein Director
Mian Raza Mansha Director
Aftab Ahmad Khan Director
Mian Umer Mansha Director
Mr. M. Ali Zeb Director
Dato’ Seri Ismail Shahudin Director
Mr.M.U.A. Usmani (President / CEO)

1.4.2 KEY MANAGEMENT

Audit Committee

Members
Tariq Rafi – Chairman
Dr. Muhammad Yaqub
Dato’ Mohammed Hussein
Aftab Ahmad Khan
Muhammad Ali Zeb
Malik Abdul Waheed

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Human Resource Committee

Members
Mian Mohammad Mansha Chairman
Dr. Muhammad Yaqub
Mian Raza Mansha
MR. Shahzad Saleem
Mr. M.U.A. Usmani

Risk Management and Portfolio Review Committee

Members
Mian Umer Mansha Chairman
Mr. Tariq Rafi
Mr. Sarmad Amin
Mian Raza Mansha
Mr. Shahzad Saleem

Business Strategy and Development Committee

Members
Mian Mohammad Mansha Chairman
Mian Raza Mansha
S. M. Muneer
Mian Umer Mansha
Dr. Muhammad Yaqub
Mr. M.U.A. Umani
Dato' Mohammed Hussein

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Committee on Physical Planning, IT Systems and Contingency Arrangements

Members
Mr. Sarmad Amin Chairman
Mian Raza Mansha
Mr. Tariq Rafi
S. M. Muneer
Mr. M.U.A. Umani

SBP Report Compliance Monitoring Committee

Members
Dr. Muhammad Yaqub
Mr. Aftab Ahmad Khan
Mr. M.U.A. Umani

Chief Financial Officer

Mr. Salman Zafar Siddiqi

Company Secretary
Mr. Abdus S. Sami

Auditors

KPMG Taseer Hadi & Co.

Chartered Accountants

Legal Advisors

Khalid Anwer & Co.

Advocates & Legal Consultants

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1.4.3 STAFF STRENGHTH

2019 2020 2021 2022

Number of Permanent Employee 13,596 13,272 13,849 14,341

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1.4.4 HIERARCHY OF MANAGEMENT

Grades of Bank

SEVP

ESEVP

SVP

VP

AVP

Grade - 1

Grade - 2

Grade - 3

Assistant

Clerical Staff Non- Clerical Staff

Cashier Messenger

Technical Staff Dispatch Rider

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 1.5 PRODUCT & SERVICES

1.5.1 MCB CORPORATE FINANCING

MCB Corporate Financing provides access to diversified financing options, including

working capital loans, term loans, trade finance services and investment banking.

 Working Capital Loans

Based on the customer’s specific needs, the Corporate Bank offers a number of different
working capital financing facilities including Running Finance, Cash Finance, Export
Refinance, Pre-shipment and Post- shipment etc. Tailor- made solutions are developed
keeping in view the unique requirements of your business.

 Term Loans

MCB offers Short to Medium Term Finance to meet capital expenditure and short term
working capital requirements of our customers. The loans are structured on the basis of
underlying project characteristics and cash flows of the business.

 Trade Finance Services

Under Corporate Banking MCB offers trade finance services that include an entire range of
import and export activities including issuing Letters of Credit (L/Cs), purchasing export
documents, providing guarantees and other support services.

 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.

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  Transaction Banking Division

Transaction Banking provides wide range of value added services to large corporations
through its vast network of real-time online branches network. Our structured and
customized products enable our customers to realize their sales proceeds swiftly from all
over the country, supported by real-time MIS.
The basic products offered by Transaction Banking Division are as under:

 Collections
 Payments
 Channel Financing
 Local Rupee Drawing Arrangement
 Home Remittances

1.5.2 MCB RETAIL BANKING

1.5.2.1 DEPOSIT ACCOUNTS

 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
1,100 branches across the country. The different accounts include: the basic 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 the others the
conventional Current Account.

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  Savings Account

It 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, a
unique product: Smart Savings is an account run solely via a debit cart, offering a very
competitive rate to small savers.

 Foreign Currency Account

Enjoy the confidence of operating an international account, locally. MCB Foreign Currency
Account offers the option of earning attractive returns on your Foreign Currency Investment.

 Saving 365 Gold

MCB Savings 365 Gold Account offers you a wide range of attractive profit rates. The MCB
Saving 365 calculates profits on a daily product basis and gives you the facility of unlimited
withdrawals.

 Smart Dollar Account

MCB Smart Dollar Account is a sensible way to maintain or grow your US Dollar deposit
across USD Current, Savings or Term Deposits.

 Special Term Deposits

With a wide range of choices and tenors, you can open one or more term deposit accounts
that best suit your current or long term needs MCB Term Deposits offer attractive short to
mid-term investment options with flexibility, convenience and security. With various tenor

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options available customers can choose one that suits their needs. This is combined with
different profit payout options and the added facility of being able to avail credit facility
against their deposits.

 Business Accounts

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

 Saving Extra Account

MCB Savings Extra Account offers you a wide range of attractive profit rates. Grow with
MCB Extra by saving more and earning greater profit.

 Current Life Account

The coverage you need for the life you lead. MCB Current Life gives you the peace of mind
of comprehensive life insurance in a current account and fits right into your lifestyle

 Mahana Khushali Bachat

MCB Monthly Khushali Scheme provides you with a steady income every month. Just
purchase a Monthly Khushali Certificate and you will enjoy a steady income of your total
deposit every month. Terms deposit.

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1.5.2.2 MCB BANCASSURANCE

Combining the best of banking and insurance solutions, MCB Bancassurance has created a
one-stop 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 just for you.
 FlexiLife
 LifePartner
 EduCare
 DreamWedding
 CapitalSure
 RetireEasy
 IncomeMax
 FutureAssure
 ProtectionPlan

1.5.2.3 MCB’S REMITTANCE

Fast, secure and easy-to-use, MCB's Remittance Services is an efficient way to transfer
money overseas. You can remit funds from any country to Pakistan through Swift System.

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 Xpress money, Samba (Speed cash now) and MoneyGram, along with
cash payments from other correspondents all over the world.

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1.5.2.4 MCB LOAN PRODUCTS

 Car4U

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

 Business Sarmaya

Good cash flow is the key to any successful business. MCB Business Sarmaya offers
running finance facility against your house/ flat, insuring a steady cash flow for your
business.

 Pyara Ghar

MCB Pyara Ghar is an ideal Home Finance from your own bank that lets you Purchase,
Renovate or Construct your home the way you have always wanted. Having your own home
was never so easy

 Easy Personal Loan

MCB Easy Personal Loan provides you with the financial advantage to do things you've
always wanted to but never had the sufficient funds for. Take that much-needed holiday.
Buy a car. Refurnish your house. Purchase a new TV. Finance a better education for your
children.

 Instant Finance

With MCB instant Finance get a loan instantly at any MCB branch against liquid collateral
at competitive pricing.

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1.5.2.5 MCB RUPEE TRAVELERS CHEQUE

It is a safe and secure way to make payments nationwide. MCB Rupee Travelers Cheque,
being the market leader, is the most widely accepted way to pay cash for travel-related
purposes MCB Rupee Traveler's Cheques were first introduced in 1993 as safe cash for
traveling and travel related purposes.

1.5.2.6 MCB ONLINE SERVICES

 ATMs

MCB has one of the nation's largest ATM networks with over 450 ATMs and still growing.
MCB ATMs give you 24-hours convenience of cash withdrawal, mini-statement, utility bill
payment, funds transfer services and much more. With MCB Mobile ATM not only do we
provide you with world class banking service but we also provide convenience. Our
innovative mobile ATMs ensure that you are given service close to you.

 Call Center

The state of the art MCB call center is the right choice to keep you in step with your ever
hectic schedule by providing you services relating to your account and Smart card at any
point in time.
There’s no easier way to bank than the new enhanced 24/7 MCB Call Center, which blends
innovation and convenience to provide Banking Services that go beyond expectations. With
MCB Call Centre you can maintain your VISA credit & ATM/Debit cards, check your
account balances, confirm last 5 transactions, pay utility & mobile phone bills, top-up your
mobile, pay MCB Visa Credit Card bill from your MCB account, transfer money within
your own accounts in MCB and register complaint.

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  Mobile Banking

At the forefront of technological excellence, MCB proudly introduces MCB MOBILE

BANKING. MCB Mobile is a quick easy and secure way to recharge mobile phones,
transfer money, pay bills and do much more.
No need to visit a branch or an ATM anymore, login to www.mcbmobile.com using your
mobile phone and start transacting.

 Bill Payments

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

 Online Banking

MCB has a fast growing network of over 1,100 online branches in the country providing
customers real time online transaction facilities.

1.5.2.7 MCB CARDS

 Smart Card

MCB Smart Card is the key that enables access to convenient banking services. Smart Card
allows you to manage your account, withdraw cash, transfer funds, pay utility and mobile
bills, recharge prepaid connections, and register for mobile and internet banking services and
much more. The convenience and flexibility of MCB Smartcard will help you live a

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Smarter life. It not only helps you manage your expenses, but also eliminates undue interest
on your day to day credit card transactions. Your balance is always within your reach and
you spend accordingly.
MCB now brings MCB Smartcard -a secure and convenient instrument of payment with
unmatched functionalities. It provides 24-hour direct access to your bank account.

 Debit Card

Now MCB brings a secure, convenient and quick payment facility that enables you to do
purchasing by using your existing MCB ATM / MCB Smart Card as a DEBIT CARD.

 Visa Credit Card

MCB offers a complete suite of Classic, Gold and Platinum Visa Credit Cards focusing on
providing, superior service, 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.

1.5.3 MCB INVESTMENT BANKING

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
MCB goal is to provide best financial solutions to client helping them achieving their
objectives and support economic growth of the Country.

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The basic services offered by investment banking are as under:

 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.

 Syndicated Loans and Debt Capital Markets

It involves structuring/advisory 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.

 Quasi Equity/Hybrid Instruments

It structures and places a category of debt that has some characteristics of equity such as
being unsecured, subordinated or with a potential equity upside.

 Equity Capital Raising

Equity Services relate to raising capital for 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.

 Advisory Services

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

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  Facility Administration

Management of creditor interests in syndicated transactions in capacities such as facility

agent, security trustee, project monitoring bank, book-runner etc.

 Commercial Banking
Complementary products and services such as revolving lines of credit, trade services and
cash management that may be bundled with our Investment Banking Products.

1.5.4 MCB AGRICULTURE PRODUCTS

MCB has been providing finance to the agriculture sector since 1973. With the help of our
vast branch network, specialized staff posted in the branches, multiple and diversified
product range, we cater to the financing requirements of the farming community spread
throughout the country and facilitate in achieving increased productivity.

 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 tubewells, maintenance expenses for tractors and the
like items as per list of Eligible items.

 Khushali Scheme

Under Khushali Scheme loans/finances are allowed for farm/ non-farm credits which
include fixed investments/working capital requirements. Amount of finances sanctioned
depend upon the credit requirement and collateral.

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Financing for land leveling/development, heavy equipment, agriculture machinery,
vehicles/transport for agri purpose are covered under this scheme. There may be other
development projects proposed by the farmers falling with in the ambit of agri financing,
which can be considered under this scheme.

 Tractor Finance Scheme

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

 Aabiari Scheme

Under the Aabiari scheme, financing facilities for tube well, other wells, irrigation systems
of all types including sprinklers are covered. The purpose is to facilitate the farmers in
overcoming the shortage of water for cultivation/plantation since water is essential
requirement for crops.

 Grower Finance

Grower Finance is a unique way of financing registered/(bonafide) growers/farmers of

sugarcane, cotton and rice(mills). The special characteristic is that the financing facilities are
extended to farmers against the Mill/Factory guarantee. Fixed/floating charge may be
created on the Mill's assets and the loan is disbursed directly to the growers. This finance is
short term in nature but the tenure may extend to eighteen months in case of growers of
sugarcane.

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  Dairy & Meat Plan

The plan is aimed at promoting the Dairy sector & meat production in the country. The
farmers are extended financing facilities to purchase dairy animals for milk and for the
establishment of animal fattening stations to increase meat production on commercial line,
thus enabling the farmer to create more income.

 Murghbani Scheme

Murghbani Scheme covers extensively all requirements of the poultry industry with focus on
facilitating the farmers. We offer financing facilities of all types of activities in the value
chain starting from establishment of poultry farms infrastructure to all requirements in the
process till the final out put including marketing of the same by the farmers. Value addition
process by the farmers for poultry processing is also covered under the scheme.

 Baghbani

The scheme aims at facilitating the farmers engaged in horticulture by extending credit
facilities covering the entire range of related activities. The proposals are assessed keeping
in view the market potential and repayment capacity based on the cash flows of the activity.
The farmers are extended all type of credit facilities required to produce fruits & vegetables
of better quality. The repayment of the loan is as per farmer convenience or linked to crop
cycle and timings of cash flows. Facilities like running finance, working capital
requirements, infrastructure development, machinery & equipment, irrigation etc are all
covered under this scheme.Progressive farmers are specially encouraged

 Mahigeri Scheme

Mahigeri Scheme caters to the credit needs of fish farmers covering entire range of activities
including marketing of their produce. The loans are of short, medium and long term

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 depending upon the purpose. Financing for value addition process by the fish farmers is also
covered under the scheme.

1.5.5. VIRTUAL BANKING

MCB provides the convenience of banking via internet, whether at home, office or on travel,
log on to www.mcb.com.pk and enjoy 24 hour access to all your accounts at MCB for great
number of services such as Funds Transfer, Utility Bill Payments, Mobile Top-ups and
much more.

 Detailed Account Summary of all listed accounts.

 Mini-statements of each of the listed accounts showing recent transaction history for that
account(s).
 Statement-by-Period of each of the listed accounts, based on the period specified.
 Immediate or Scheduled Transfer of Funds between your own accounts, as well as to third-
party accounts setup as beneficiaries, maintaining accounts with MCB.
 Scheduling of ‘One-Time’ as well as ‘Recurring’ Funds Transfers.
 Payment of utility bills for registered Utility Companies.
 Immediate or Scheduled Bills Payment. Scheduling of ‘One-Time’ as well as ‘Recurring’
bill payments. Option for ‘Full’ or ‘Partial’ payment based on the payment conditions
specified by a particular Utility Company.
 Bulk Salary Transfer for Corporate Customers, to facilitate them in paying salary to the
corporate employees, who maintain accounts with MCB.
 Bulk Funds Transfer for Corporate Customers.
 Cheque Book Request for any of your listed accounts.
 Payment/Transfer Alerts for reminding, in advance, prior to the processing of specified
payments and transfers.
 Personal Alerts for reminding of pre-specified events and occasions.

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1.5.6 ISLAMIC BANKING

With the help of Shariah specialists, lawyers and professional commercial bankers, MCB
Islamic Banking provides Riba Free and Shariah Compliant solutions to various customer
segments in a growing number of cities.

 Deposit Schemes
For customers who are looking for a deposit opportunity where they can purse their
funds and reap halal returns on it, MCB offer the following products:
 Al-Makhraj Saving Account
 Al-Makhraj Ianat Account
 Al-Makhraj Term Deposit
 Fund Based Facilities
MCB offers 3 broad Islamic fund based facilities:
Ijarah
Murabahah
Diminishing Musharika Equipment

 Ijarah Products

MCB’s Islamic Ijarah, analogous to the English term 'leasing’, is based on the ‘Ijarah wa
Iqtina’ concept which means the sale of the asset to the lessee after the Ijarah has matured.
Under this scheme, MCB will be the owner of the asset, and the customer (lessee) will be
given the asset to use for a certain period of time in return for monthly rental payments.

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MCB will give a separate unilateral undertaking that it will offer to sell the asset to the
customer (lessee) at the maturity of the Ijarah agreement at a price that may be equal to the
security deposit amount, hence the term ‘Wa Iqtina’

Types of Ijarah

Car Ijarah

Equipment Ijarah

 Murabahah

It is a contract between a buyer and a seller under which the later first purchases the
goods at the request of the former i.e., customer and then sells it to same customer
after adding profit.

Murabah Sale Price = Cost + Expenses incurred + Agreed Profit

 Musharika Equipment

It is a contract through which the bank and its client participate in the joint
ownership of a property. The share of the Bank is further divided into a number of
units and it is agreed that the client will purchase the bank’s share periodically, thus
increasing his own share until all the units of the bank are purchased by him so as to
make the client the sole owner of the property.

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1.5.7 PRIVILEGE BANKING

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 for affluent clientele. As members of MCB Privilege, customers experience
unparalleled advantages that put them ahead of others. MCB’s dedicated Privilege Centers a
wait to welcome you in Karachi, Lahore, Islamabad and Multan, with plans to expand to
more locations.

1.5.8 OTHER SERVICES

 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.

 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.

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

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  MCB SMS Banking
Banking at your fingertips SMS anytime to get information regarding balance, mini
statements and credit card related information once your card is linked.

 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.

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 2. ORGANIZATIONAL STRUCTURE

2.1 ORGANIZATIONAL CHART

Board of Directors

Chairman

President

Audit & RAR Wholesale Banking Consumer Banking Islamic Banking Commercial Treasury & Forex

Special Assets Public Relations Risk Management Compliance & Strategic Planning Financial Control
Management Control & Investment

Information Project Human Resource Operations Business Development and

Technology Management Management New Initiatives

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2.1.1 MAIN OFFICES

Registered Office
MCB Building, F-6/G-6, Jinnah Avenue, Islamabad.

Principal Office
MCB 15 Main Gulberg, Lahore.
UAN: (042) 111-000-111
PABX: (042) 36041998-9
Website: www.mcb.com.pk
Email: info@mcb.com.pk

Shares Registrar
M/s. THK Associates (Pvt.) Ltd., State Life Building No.3,
Dr. Ziauddin Ahmed Road, Karachi

Corporate Office
MCB House, Jail Road, Lahore

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2.1.2 BRANCHES NETWORK

Branch Network

DEC 2010

Domestic Overseas
Operations -1139 Operations -07

Sri Lanka -05

Branches 1,125

Sub
Bahrain-01
Branches 9

Punjab-700

Sub
Branches 4 EPZ-01

Sindh-251

Sub UAE -01

Branches-1
Khyber
Pakhtunkhawa-110

Balochistan -40

Azad Kashmir-24

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 2.2 ORGANIZATIONAL STRUCTURE OF THE BRANCH
A well-developed and properly coordinate structure is an important requirement for the
success of any organization. It provides the basic framework within which functions and
procedures are performed. Any organization needs a structure, which provides a framework
for successful operations. The operation of an organization involves a number of activities,
which are related to decision making, and communication of these decisions. These
activities must be well coordinated so that the goals of the organization are achieved
successfully
General Manager Commercial

Regional Operational Regional Head / VP

Manager / VP

Branch Operational Branch Manager /

Internal Control Manager / OG III VP
Officer / OG I

GEN.BANKING DEPTT CASH DEPTT CREDIT DEPTT

Incharge Forex OGIII

B
Branch Supervisor / OGIII Chief Teller/Assistant Credit Officer / OGIIII
R
A
N GBO - Transfer / OG-III Teller Outsource
C
H
Personal Banking Advisor
GBO- Remittance / OG-I Teller Outsource

GBO- Clearing / OG-II Personal Banking Personal Banking

Advisor-OGIII Advisor-OGII

Customer Service Customer Services

Officer Officer

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2.3 DEPARTMENTS OF WAZIRABAD BRANCH (0947)

The departments are as under

 General Banking Department

 Clearing Department

 Remittance Department

 Credit Department

 Accounts Department

 Foreign Trade

 Internal Control Department

2.3.1 CLEARING DEPARTMENT

Clearing means collection of cheques receive from our customers but drawn on other banks.
Receiving the instruments deposited by customers Posting the amount of instruments in
credit of customer’s account If cheque returns from the concerned bank, the customer
account is debited. Crossing stamp is put on the instrument and slip given to customer on
receipt of the instrument. Clearing stamp and “payee account credited” are put on the
instrument and the voucher. Clearing House has provided this facility. Clearing house
facilitates different banks, in one city, to get their cheques drawn upon other banks to be
cleared.

Cheques lodged in clearing constitute in clearing constitute two types of clearing:

 Outward Clearing
 Inward Clearing

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  Outward Clearing
When cheques, TC’s and other negotiable instruments drawn upon other banks like NBP,
ABN AMRO of the same city (as Lahore) are presented in Muslim Commercial bank to
deposit them in the respective payee’s accounts, these instruments are lodged in outward
clearing (o/w clg) of MCB bank.

Procedure of Outward Clearing

 The name of the branch appears on its face where it is drawn

 It should not stale or post - dated or without date.

 Amount in words and figures does not differ.

 Signature of the drawer appears on the face of the instrument.

 Instrument is not mutilated.

 There should be no material alteration, if so, it should be properly authenticated.

 If order instrument suitably indorsed and the last endorsee’s account being credited.

 Endorsement is in accordance with the crossing if any.

 The amount of the instrument is same as mentioned on the paying-in-slip and

counterfoil.

 The title of the account on the paying-in-slip is that of payee or endorsee (with the
exception of bearer cheque).

 If an instrument received other than MCB of Pakistan then special crossing stamp is
affixed across the face of the instrument. Clearing stamp is affixed on the face of the
instruments, paying-in-slip and counterfoil (The stamp is affixed in such a manner
that half appears on counterfoil and paying-in-slip). The instrument is suitably
discharged, where a bearer cheque does not require any discharge and also an
instrument in favor a bank not need be discharged.

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 Return Outward Clearing
 Over writing

 No stamp of clearing or if it is not clear

 No stamp of crossing or if it is not clear

 Inward Clearing

Inward clearing means cheques drawn on us and presented by other banks. In inward
clearing Branch acts as paying banker. After realization of inward clearing, banks deposits
are decreased as bank makes payment to other banks from the balances held by the branch.
This realization of inward clearing is also referred to as responding to the clearing. Cheques
and other negotiable instruments instruments (PO, DD, PS, CDR etc.) drawn on Muslim
bank, sent by other banks, constitute the inward clearing of MCB.

Procedure of Inward Clearing

 Instruments with schedules are received from NIFT.
 Amount of each instrument entered is in inward clearing register.
 Instruments are detached and handed over to the deposits and other respective
department for checking and payment.
 In case of any instrument is returned, return memo is prepared stating the reason of
the return.
 Entry is made in cheques Return register.
 Cheques return charges are recovered from the party as per charges schedule.

Checking / Return of Instruments

 Over writing

 No stamp of clearing or if it is not clear

 No stamp of crossing or if it is not clear

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2.3.2 REMITTANCE DEPARTMENT

The Remittance department deals with the transfer of money from one place to another.
Funds transfer facility or remittance of funds is one of the key functions of the banks all over
the world. Remittances through banking channels save time, costs less and eliminate the
risks involved in physical transportation of money from one place to another. Muslim
Commercial Bank of Pakistan transfers money in the following ways.

 Pay Order
 Demand Draft
 Mail Transfer
 Telegraphic Transfer
 Pay Slip
 Call Deposit Receipt
 Letter of Credit
 Traveler’s Cheque

 Demand Draft

It is used for payment made outside the city. It is write on the name of head office.
Accounting entry by drawing branch. When the customer purchases a draft, the drawing
branch sends the advice (a copy of DD) to the drawee branch and the original copy of DD is
given to the purchaser. On the arrival of advice the drawee branch debits HO account and
credits the DD payable account. When the customer comes with the original DD to the
drawee branch, his account is credited by debiting the DD payable account.
Charges Commission 50/- but if amount increase or decrease then it will also increase or
decrease and FED 8/- also increase or decrease.

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  Pay Order

Payment Orders are issued for the money transfer with in the city. Pay order is made for
local transfer of money. Pay order is the most convenient, simple and secure way of transfer
of money.

 Mail Transfer

A Mail Transfer is a form of remittance in which the amount remitted by a customer or a

non-customer is directly credited to the account of the beneficiary with another branch.
Move your money safely and quickly using MCB Mail Transfer service. And MCB also
offer the most competitive rates in the market. They charges Rs 50/- exchange rate and RS
75/- postage charges on issuing mail transfer. When the money is not required immediately,
the remittances can also be made by mail transfer (MT). Here the selling office of the bank
sends instructions in writing by mail to the paying bank for the payment of a specified
amount of money. Debiting to the buyer’s account at the selling office and crediting to the
recipient’s account at the paying bank make the payment under this transfer.

 Telegraphic Transfer

Telegraphic Transfer is a form of remittance, which is advised by telegram, telex or fax

machines. The fundamental principles of such transfer are otherwise identical with the Mail
Transfer. It is the message, which is sent from one branch to another on the order of payer to
payee through wire. It is one of the quickest means to transfer fund through the use of
telex/fax/internet or cable.

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2.3.3 ACCOUNTS DEPARTMENT

Opening of account is the most important department of the Branch as this is a contract
between the customer and bank. All future transaction/operation are carried out as per this
contract and any deviation may jeopardize the bank’s interest. The opening of a new account
is the establishment of customer banker relationship. By opening an account at a bank, a
person becomes a customer of the bank. The customers can open following accounts:

 Current Account (CD A/C)

 Profit and loss sharing Account (PLS A/C)

 Basic Bank Account (BBA A/C)

 Fixed Deposit (FDR/TDR)

Account Opening

When a client comes to the bank, and makes a request for opening of an A/C. The officer
says that first fill up a prescribed application form. If he/she wants to open a PLS A/C, then
he/she has to fill a form according to the account.
Requirements

 ID Card of applicant

 ID Card of father, mother, brother, sister, husband or wife

 Student card (if applicant is student)

 Two photos for illiterate person or those who use Urdu signatures

Documents Attach with A/C Opening Form

 A/c opening form

 Specimen signature card

 Zakat form (for non-muslims)

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  Deposit slip

 Requisition form

Issuance of Cheque Book

After opening an A/C with the bank, the A/C holder once again makes a request in the name
of bank for the issuance of a cheque book. The A/C holder mentions title of A/C, A/C
number, sign it properly and mentions the no of leaves he requires

2.3.4 CREDIT DEPARTMENT

The bank is profit seeking institution. It attracts surplus balance from the customer at low
rate of interest and makes advances at a higher rate of interest to the individuals and
business firms. Credit extensions are the most important activity of all the financial
institutions, because it is the main source of earnings. Advances department is one of the
most sensitive and important department of the bank. The major portion of the profit is
usually earned through this department. The job of this department is to make proposals
about the loans; the credit management division of head office directly controls all the
advances. The advances Department receive application from intending borrowers. After
receiving application the advance department processes it further. After analyzing and
detailed investigation, they decide whether to approve the loan or not. Some loan approvals
are made by the Manager of the branch within his powers as prescribed by the bank’s higher
authorities, while some loan applications are submit to higher authorities for their approval.
Some advances are of the following nature

 Loan against Gold

 Agriculture advance to farmers

 Medium term advance for working capital

 Long term advance for setting industry

 Short term advance to businessman

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2.3.5 FOREIGN EXCHANGE DEPARTMENT

This department mainly deals with the foreign business. The main functions of this
departments are:

 L/C dealing.
 Foreign currency accounts dealing.
 Foreign Remittance dealing.

 L/C Dealing

MCB is committed to offering its business customers the widest range of options in the area
of money transfer. If you are a commercial enterprise then our Letter of Credit service is
just what you are looking for. With competitive rates, security, and ease of transaction,
MCB Letters of Credit are the best way to do your business transactions.

 Foreign Currency Account Dealing

This department deals with the foreign currency accounts which mainly include dollar
account, euro account etc.

2.2.6 INTERNAL CONTROL DEPARTMENT

Role of branch compliance department is to reconcile the prescribed frequencies, investigate

long pending reconciliation item, and ensure correct treatment every half-year and clearing
system service branch-in major cities. Internal control is the integration of the activities,
plans, attitudes, policies and efforts of the people of the bank working together to provide
reasonable assurance that the organization will achieve its objectives and mission.

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 2.4 DEPARTMENTS OF THE MCB

COMMERCIAL BANKING GROUP

The Group focuses on revenue growth and profitability while through cross sell and
optimization of branch banking platform. With its large network of branches, Commercial
Banking Group posted robust growth by increasing their deposit volume. The Group
enhanced their sales model through the introduction of a direct sales force team and
personnel bankers in many branches while continuing to strengthen their customer services
quality. The year witnessed a successful restructuring of the SME & Mid-market segment
with continued optimism of the benefit accruing in the upcoming times.

CONSUMER BANKING GROUP

The strategic focus of the Group to enhance cross sell, strengthen customer propositions and
improve customer service. Emphasis will be on rapid expansion of the new initiatives such
as MCB Privilege, Bancassurance, Investment Services and Alternate Distribution Channels.
In parallel, the Group will remain committed to product development & refinement of
processes for continuous growth of deposits & customer base. The Consumer Banking
Group on its path of expanding the product suite and customer base. MCB Mobile, the first
of its kind, mobile payment solution was launched enabling customers to access their
accounts and make payments using their mobile phones. With the launch of MCB Privilege,
MCB also became the first local bank in Pakistan to start a dedicated offering for the
affluent segment through three dedicated Privilege Centers in Karachi, Lahore & Islamabad.
A specialized Investment Services Unit was established to develop and distribute specialized
investment products catering to the growth needs of affluent/mass affluent segments. There
was increased focus on enhancing cross sell to deposit customers by expanding the footprint
of Bancassurance. Functionality, reach, as well as, penetration of Alternate Delivery
Channels was enhanced. A significant milestone in 2019 was the transformation of the call

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centre from a service center to a transactional phone banking facility. Given the high interest
rate environment and tight economic conditions, 2019 remained a cautious year for the
consumer financing business. Only selective lending was carried out in segments that have
performed well historically. With close monitoring of NPLs, the focus remained on
collection & recovery and portfolio management during the year.

CORPORATE BANKING GROUP

Corporate Banking Group's scope of work was expanded with the inclusion of International
Division and Investment Banking, which were absorbed to create better control and synergy.
The group managed to maintain the quality of their risk assets and derived comfort from the
fact that corporate non-performing loans constituted only 1% of the total corporate portfolio
as compared to industry percentage of 4%. The group embarks with cautious optimism with
strategic thrust being on building fee based income and trade business by cross selling to the
existing customer base. Information technology led changes in Transaction Banking (TB)
related Products led to a quantum jump in volumes and income, as a result of automation of
payments and collections systems.

TREASURY AND FOREX GROUP

Treasury & FX remained focused on its customer orientation and enhanced its coverage to a
broader customer base. The portfolio of customers grew not only through the Treasury

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Marketing Unit's own efforts but also as a result of a better cross-sell platform fully
supported by the Wholesale, Commercial, Consumer and Financial Institutions businesses.
Fixed Income sales showed substantial improvement over the past year's performance and
remained an area of focus.
The Treasury Money Market business worked towards gradually enhancing the investment
portfolio's duration over the course of the year. This effort was granted greater buoyancy by
the stable deposit growth shown by the bank during the year and the portfolio was almost
entirely funded through the bank's own sources and decreased whatever little dependence
there was on the inter-bank money market. The enhanced duration of the portfolio ensured
that the deposit-taking areas of the bank were able to pay superior rates of return to
customers and was a key support factor in the overall growth of the bank's balance sheet.
The Foreign Exchange business continued to grow over the course of the year in spite of
substantial volatility in the inter-bank markets owing to the turbulent economic situation
facing the country. Overall the Treasury & FX Group turned in a very strong performance
and ensured its continued support for the rest of the bank's businesses. The Treasury
followed through on the vision of the Bank's management and deployed a Treasury
Marketing Unit in Lahore which supports the bank's client base in key centers such as
Islamabad, Rawalpindi, Lahore, Faisalabad etc. Further efforts in this regard are continuing
and in the coming year Treasury will add at least one more marketing desk in a major city
broadening its coverage even further.

ASSETS MANAGMENT GROUP

Bank's Special Asset Recovery outfit (SAMG) role further prominence. SAMG, posted cash
recovery in excess of Rs. 1 Billion. It is foreseen that the asset remedial management
function would continue to play a visibly pronounced role at least in the medium term
scenario.

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AUDIT & RAR GROUP

Audit Group has performed consultative role in addition to the assurance services that it is
geared to provide. The Group has strengthened itself to cater to the requirements of Bank's
Whistleblowing Program. Training & Quality Assurance
Department, developed within the Group, ensures that the audit assignments qualify the high
standards that have been defined for the Group. Audit Group is now equipped both in terms
of human resource and methodology, and is committed towards optimization of its
operations.

OPERATIONS GROUP

Operations group made significant progress through centralization, strengthening of the

Bank's processes through compliance with the COSO based Internal Control Framework,
Business Continuity Management and Staff Training & Development. Strong operational
support was provided to the businesses to ensure the launch of new products, channels and
services including Bancassurance, Privilege Banking, Mobile Banking, Phone Banking,
Trade Products & Cash Management as well as in the migration of core banking application
across all branches in the country.

HUMAN RESOURCE GROUP

The Human Resources Group has worked towards instilling systematic processes to build a
performance-based culture based on internal equity. Alongside aligning the bank with best
practices, this is surely to bring about an efficient and motivated workforce. The Group will
be further developing staff through a focus on career development and training to truly
brand MCB as an employee-focused organization.

BUSNIESS DEVELOPMENT AND NEW INITIATIVES

The Group, in close coordination with the Board and senior management, led the bank-wide
strategic planning exercise to refine and revalidate MCB's 2012 strategy. Program Alpha, an
initiative tasked with transforming branches into efficient sales and service centers was very
active. The Group also set-up a bank-wide Central Business Intelligence Unit responsible for

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supporting the retail bank in its sales and performance MIS needs. BDNI will continue to
ramp up on Program Alpha and BIU coverage and will work closely with all bank groups to
ensure strategy delivery.

INFORMATION TECHNOLOGY GROUP

The major focus was on the completion of the roll-out of the Core Banking System
(Symbols) which heralds a new era for the bank. Apart from the roll-out, the Group focused
on up gradation of network technology, revision of security framework and provision of
disaster recovery for the critical business applications, deployment of a new Payments and
Collection system moving MCB to the 3rd market position (from 7th) and launched its
Mobile Banking platform fully integrated with MCB systems. Information Technology
governance model has been introduced to ensure quality selection, monitoring and delivery
of all high value projects.

COMPLIANCE GROUP

Compliance Group focus on pro-actively identifying and resolving any regulatory gaps,
particularly related to Know Your Customer (KYC) and Anti-Money Laundering (AML).
To create awareness across the bank regarding KYC & AML regulations, over eighty
training sessions were conducted by the group in 39 cities / regions training approximately
2,600 staff. Other initiatives were undertaken in the shape of “Compliance News Letter” and
“Regulatory & Legal update”.. The Bank is now moving towards a solution based
monitoring and has already acquired “Name filtering” solution while an AML solution is in
the process of being finalized for implementation which will better equip the bank in
curbing any unscrupulous transaction.

RISK MANAGEMENT GROUP

Prudent and effective risk management is and has always been a significant success factor in
steering the Bank's march towards strong profitability and market leadership. The Bank
employs the function of risk management as an important tool in implementation of its long
term vision. MCB has successfully created a culture based on modern techniques that allows

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Risk management and business units to create more shareholder value through a better
understanding of our Bank and our customers. The Risk Management framework combines
core policies, by procedures and process design with oversight and is supported by risk
monitoring across the bank. Elements of risk management framework are reviewed and
updated in order to align our long-term strategy in the field with lessons learned through the
Bank's own experiences and international best practices also kept compliant with the local
regulations and selected international best practices, particularly those relating to
implementation of Basel-II.

The group controls the review and administration of lending solutions offered to our clients
through a dedicated team of experienced professionals. Specific functions of the group
ensuring particular risk management are;

• Credit Review and Credit Risk Control ensure that lending decisions are in line with the
Bank's strategy, lending is prudently given, and that recoveries are actively monitored;

• Credit Risk Management identifies target markets through economic research and data
analysis, defines how the Bank lends to its customers through detailed policies and
procedural product manuals and coordinates with business units to ensure that targeted
lending activity is in line with the Bank's overall risk appetite and strategy;

• Market Risk Management ensures that the Bank's exposures in financial markets are
actively managed within reasonable limits;

• Operational Risk Management helps the Bank understand risks and improve mitigating
controls so as to minimize operational risks that are inherent in almost all areas of the Bank;

• Basel II Projects monitors the implementation of various projects in the areas of credit,
market and operational risk that have been initiated to allow the Bank to adhere to, and
adopt, the internationally accepted best practices of Basel II;

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• In addition to the internal Compliance unit within the Risk Management Group, the Risk
Management & Portfolio Review Committee provides oversight and direction to the
activities of the Group. These elements of risk management within MCB Bank collectively
ensure that the Bank's risk profile is actively monitored and adjusted according to the Bank's
strategy and the operating environment in a manner which ensures protection to the
depositor and value to the shareholder.

INVESTMENT GROUP

The principal purpose of an investment group is the underwriting of new securities issued by
an investment bank's clients. An investment bank may also provide other services, such as
professional advice, working with mergers & acquisitions, and private wealth management.

INTERNAL CONTROL GROUP

The Bank's internal control structure comprises of the Board of Directors, Senior
Management, Risk Management Group, Compliance & Control Group, Financial
Control Group, and Self-Assessment Process within business groups and Internal
Audit. The Management is responsible for establishing and maintaining a system of
adequate internal controls and procedures for implementing strategy and policies as
approved by the Board of Directors, designed to provide reasonable assurance as to
the integrity and reliability of those controls and reports produced there from;
developing processes that identify, measure, monitor and control risks incurred by
the Bank; maintaining an organizational structure that clearly assigns responsibilities,
authority and reporting relationships; ensuring that delegated responsibilities are
effectively carried out.

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 3. CRITICAL ANALYSIS OF THEORETICAL CONCEPTS
RELATING TO PRACTICAL EXPERIENCES

4.1 FINANCIAL ANALYSIS OF BALANCE SHEET

Balance Sheet of
2019 2020 2021 2022 2023
Five Years

…………………….Rupees in 000……..………………..

Assets

Cash and balances

38,774,871 39,631,172 39,683,883 32,465,976 23,665,549
with
treasury banks
Balances with
6,009,993 4,043,100 3,807,519 6,577,017 1,469,333
other banks
Lending to
financial 3,000,000 4,100,079 1,051,372 6,577,017 9,998,828
Institutions
Investments-net 167,134,465 96,631,874 113,089,261 63,486,316 69,481,487

Advances-net 253,249,407 262,135,470 218,960,598 198,239,155 180,322,753

Operating Fixed
18,014,896 17,263,733 16,024,123 9,054,156 8,182,454
assets
Deferred tax asset - - - 172,373 191,967

Other assets 23,040,095 19,810,476 17,868,761 11,031,450 5,464,426

Total Assets 509,223,727 443,615,904 410,485,517 342,108,243 298,776,797

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Liabilities
Bills payable 8,201,090 10,551,468 10,479,058 7,089,679 8,536,674

Borrowings 44,662,088 22,663,840 39,406,831 23,943,476 27,377,502

Deposits and other

367,604,711 330,181,624 292,098,066 257,461,838 229,345,178
accounts
Sub-ordinated
- - 479,232 1,597,440 1,598,080
loans
Liabilities against
assets
- - - - -
subject to finance
lease
Deferred tax
3,196,743 437,137 1,180,162 - -
liabilities
Other liabilities 15,819,082 21,345,781 11,722,493 11,171,496 8,611,600

Total Liabilities 439,483,714 385,179,850 355,365,842 301,263,929 275,469,034

Represented By:

Share capital 6,911,045 6,282,768 6,282,768 5,463,276 4,265,327

Reserves 38,385,760 36,768,765 34,000,638 24,662,426 13,408,005

Unappropriated
15,779,127 9,193,332 5,130,750 5,530,973 210,662
profit

Surplus on
revaluation of 8,664,081 6,191,189 9,705,519 5,187,639 5,423,769
assets net of tax

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Total Liabilities & share Capital 509,223,727 443,615,904 410,485,517 342,108,243 298,776,797

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4.2 FINANCIAL ANALYSIS OF PROFIT & LOSS ACCOUNTS

Years 2019 2020 2021 2022 2023

........................Rupees in 000………………..

Mark-up / return /
interest Earned 51,616,007 40,043,824 31,786,595 25,778,061 17,756,232

Mark-up / return /
15,841,463 11,560,740 7,865,533 4,525,359 2,781,468
interest Expensed

Net mark-up / interest

35,774,544 28,483,084 23,921,062 21,252,702 14,974,764
income

Provision for diminution

1,484,218 2,683,994 105,269 121,197 98,982
in value of investments

Provisions against loans 5,796,527 1,335,127 2,959,583 1,014,540 1,242,153

& Advances

Bad debts written off

41,576 - 199 47,000 1,184
directly

Net mark –up / return /

interest income after 28,452,223 24,463,963 20,856,011 20,069,965 13,830,409
Provisions

Non Mark – up /
Interest income

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Fee, Commission and
3,331,856 2,953,394 2,634,610 2,311,235 2,448,950
Brokerage Income

Dividend Income 459,741 617,554 632,300 811,801 480,344

Income from dealing in 341,402 727,564 693,408 692,010 531,455

foreign Currencies

_ _ _ _ 866,895
Gain on Investments

Gain on sale of
773,768 740,429 1,500,865 605,865 851
securities-net

Unrealized loss on
revaluation of _ (103198) (13105) _ _
investments classified as
held for trading

Other income 736,118 855,697 563,213 570,505 1,084,756

Total non- mark-up / 5,642,885 5,791,440 6,011,291 4,991,416 5,413,074

return / interest income

34,095,108 30,255,403 26,867,302 25,061,381 198,243,480

Non Mark-up / Interest

Expenses

Administrative expenses 10,107,189 7,546,878 5,022,416 6,482,592 6,459,490

Reversal / Other
provisions –net 142,824 23,135 (3,743) 11,411 (72,740)

Other charges 690,150 817,824 540,594 66,708 178,841

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Total non -mark-up /
interest Expenses 10,940,163 8,387,837 5,559,267 6,560,711 6,565,591

Compensation on
_ _ _ _ 340,598
delayed tax refunds

Profit Before Taxation 23,154,945 21,867,566 21,308,035 18,500,670 13,018,487

Taxation
7,659,648 6,492,966 6,042,473 6,358,272 4,096,072

Profit After Taxation 15,495,297 15,374,600 15,265,562 12,142,398 8,922,415

Unappropriated profit
9,193,332 5,130,750 5,530,973 4,990,260 165,208
brought Forward

Transfer from surplus on

revaluation of fixed 22,324 21,319 11,855 32,166 83,749
assets – net of tax

Profit Available For 24,710,953 20,526,669 20,808,390 17,164,824 9,171,372

Appropriation

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 4.3 RATIO ANALYSIS

ABBREVIATION USED IN FOLLOWING CALCULATIONS

WORDS ABBREVIATION
Earning after tax EAT
Net Markup income NMI
Gross markup income GMI
Total income T.I
Operating income OP
Operating expenses OE
Total Shareholder Equity TSE
Net Sales N.S
Market price per share MPS
Earnings per share EPS
Earning before tax EBT
Total outstanding shares TOS
Book Value BV
Dividend per share DPS
Total debt T.D
Total liabilities T.L

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 CALCULATION OF RATIOS

Ratio Type Formula 2019 2020 2021 2022 2023

PROFITABILITY RATIOS

Profit before tax PBT/T.I 55.91% 63.80% 70.16% 70.49% 62.80%

ratio
Net profit after tax EAT/IE 44.86% 54.60% 67.03% 71.76% 73.37%
Gross spread ratio NIM/GMI 69.31% 71.13% 75.26% 82.44% 84.34%
Income Expense
T.I/O.P 3.84* 4.10* 5.06* 4.01* 3.12*
Ratio
Return on Equity
EAT/TSE 27.35% 31.49% 37.66% 45.00% 64.85%
Ratio (ROE)
Return on Asset
EAT/T.A 3.25% 3.60% 4.065 3.79% 3.20%
Ratio (ROA)
Loan/deposit ratio Loan/Deposit 68.89% 79.39% 74.96% 76.99% 78.62%

ACTIVITY RATIOS

Total asset
Turnover T.I/T.A 0.11 0.10 0.09 0.08 0.07

Fixed Asset
T.I/F.A 3.17 2.65 2.35 3.39 2.83
Turnover

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MARKET RATIOS

Earnings per share PBT/TOS 33.50 31.64 30.83 26.77 18.88

(EPS) before tax

Earnings per share EAT/TOS 22.42 22.25 22.09 17.57 12.91

(EPS) after tax

Book Value per TSE/TOS 88.37 75.60 65.71 51.59 26.49

Share

LEVERAGE RATIOS

Debt-to-Equity
T.D/TSE 6.3 6.59 6.43 7.47 11.81
Ratio

Debt Ratio/Debt to T.D/T.A 0.86 0.86 0.86 0.88 0.92

Total Assets

*Figure in Times

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4.3.1 GRAPHICAL REPRESENTATION OF RATIOS

 PROFITABILITY RATIOS

80

70

60

50

40
Prifit Before Tax
Profit After Tax
30

20

10

0
2023 2022 2021 2020 2019

Gross Spread Ratio

90
80
70
60
50
40 Gross Spread Ratio

30
20
10
0
2023 2022 2021 2020 2019

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 Income Expense Ratio
6

0
2023 2022 2021 2020 2019

Return on Assets

5
4.5
4
3.5
3
2.5 Return on Assets
2
1.5
1
0.5
0
2023 2022 2021 2020 2019

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 Return on Equity
70

60

50

40

Return on Equity
30

20

10

0
2023 2022 2021 2020 2019

Loan Deposit Ratio

80
78

76
74
72

70 Loan Deposit
Ratio
68

66
64

62
2023 2022 2021 2020 2019

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 ACTIVITY RATIOS

Total Assets Turnover

0.12

0.1

0.08

0.06
Total Assets Turnover

0.04

0.02

0
2023 2022 2021 2020 2019

Fixed Asset Turnover

3.5

2.5

Fixed Asset Turnover

1.5

0.5

0
2023 2022 2021 2020 2019

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 MARKET RATIOS

35

30

25

20
Earning Per Share
Brfore tax
15
Earning Per Share
after tax
10

0
2023 2022 2021 2020 2019

Book Value Per Share

90

80

70

60

50

40 Book Value Per Share

30

20

10

0
2023 2022 2021 2020 2019

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 LEVERAGE RATIOS

Debt-to-Equity Ratio
12

10

6
Debt-to-Equity
Ratio
4

0
2023 2022 2021 2020 2019

Debt to Total Assets

0.92

0.91

0.9

0.89

0.88 Debt to Total

Assets
0.87

0.86

0.85

0.84

0.83
2023 2022 2021 2020 2019

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4.3.2 EXPLANATION OF FINANCIAL RATIOS

 PROFITABILITY RATIOS

Profitability ratios measure a company’s financial performance and its ability to increase
its shareholders value and generate profits. Profitability ratios provide insight into the
profits made by the company in relation to its size, assets, and sales and also measure the
company’s performance in relation to itself. Having past data as a benchmark, the firm can
start to make conclusions as to why profitability is increasing or decreasing.

The net profit margin Net profit after tax measure profit remaining after deducting all
expenses including tax. It should be maximum. Markup/return/interest earned and non-
markup interest income increased throughout the period i.e. year 2023 up to year 2019.
While markup/return/interest expensed was increased throughout from 2023 as a result of
net profit after tax ratio decreasing. The income & expenses have direct relation, that’s why
it affects net profit ratio.

The gross spread ratio relationship between Net Markup income & Gross markup income.
Gross spread ratio is continuously increasing from 2023 to 2019.

Income expense ratio as shows the percentage of expenses it should be lower. In bank
income expense ratio has decreasing trend from 2021 to 2019.

Return on equity measures a corporation's profitability by revealing how much profit a

company generates with the money shareholders have invested. A company with high return
on equity is more successful to generate cash internally. But in this bank return on equity is
throughout decreasing trend (2023 to 2019) due to increase in borrowing /debt its means
the bank generate low profit with the money shareholder have invested So if the firm takes
on too much debt, the cost of debt rises as creditors demand a higher risk premium, and
ROE decreases. It is generally accepted that a company with a higher ROE is a better

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investment than one with a lower ROE since it has a stronger ability to generate cash flows
internally; however, this is not completely accurate.

Return on assets (ROA) return on assets of commercial banks reflects the effectiveness and
efficiency of the use of resources is the embodiment of its operating efficiency and
management level of the important comprehensive index. In year 2021 ROA is higher in all
five years due to increase in earnings after tax so the bank is better at converting its
investment into profit. But in the year 2019 return on asset is decrease because net income in
this year is also decrease.

Loan deposit ratio if the ratio is too high, it means that banks might not have enough
liquidity to cover any unforeseen fund requirements; if the ratio is too low, banks may not be
earning as much as they could be. So in this bank in year 2019 this ratio is decreased as
compared with previous year.

 ACTIVITY RATIOS

These ratios also known as efficiency or turnover ratios, measure how effectively the
Organization is using its assets.

Total asset turnover represents the amount of revenue generated by a company as a result
of its assets on hand. One general rule of thumb is that the higher a company's asset
turnover, the lower the profit margins, since the company is able to sell more products at a
cheaper rate. In this bank total assets turnover ratio is increasing trend throughout (2023 to
2019) because total assets are increase in every year
Fixed assets turnover ratio establishes a relationship between net sales and net fixed
assets. This ratio indicates how well the fixed assets are being utilized. This ratio expresses
the number to times the fixed assets are being turned over in a stated period. It measures the
efficiency with which fixed assets are employed. A high ratio means a high rate of
efficiency of utilization of fixed asset and low ratio means improper use of the assets. In this

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bank fixed asset turnover ratio have increasing trend throughout In year 2021 this ratio is
decrease means the bank have not utilized its fixed assert properly

 MARKET RATIOS

These ratios are calculated to analyze the market position of a business

Earnings per share (EPS) are the amount of earnings per each outstanding share of a
company's stock. In the bank earnings per share ratio are showing increasing trend from
2023 due to increase in earnings after tax. It is an accepted fact that earnings per share ratio
can help us know the financial strength of a company. The more the earnings per share
ratio, more would be the profitability of the company. Earnings per Share represent the
measurement, which is used to calculate earnings. The rise in prices of MCB shares and
higher EPS calculates a stronger Price to Earnings (P/E) ratio Rs. 9.80, from 5.66 in 2020

Book value per share shows value of share as per books. It should be maximum. Book
value per share of the bank has increased due to increase in shareholders’ equity

 LEVERAGE RATIOS

Debt to Total Asset measure of a firm assets financed by debt and, therefore, a measure of
its financial risk. The lower this ratio, generally the better off the firm. The higher the ratio,
the greater risk will be associated with the firm's operation. In addition, high debt to assets
ratio may indicate low borrowing capacity of a firm, which in turn will lower the firm's
financial flexibility. Like all financial ratios, a company's debt ratio should be compared
with their industry average or other competing firms.

The debt/asset ratio shows the proportion of a company's assets which are financed through
debt. If the ratio is less than 1%, most of the company's assets are financed through equity. If

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the ratio is greater than 1%, most of the company's assets are financed through debt. In this
bank years (2023 to 2019) this ratio have been less than 1% so this bank assets are finance
through equity
Debt To Equity Ratio It indicate how much the company is leverage (in debt) by
comparing what is owned, if the ratio is greater than one the majority of assets are finance
through debt, if answer is smaller than one assets are primarily finance through equity This
ratio of bank throughout the years 2023 to 2019 greater than one.

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 4.4 HORIZONTAL ANALYSIS OF
BALANCES SHEETS

YEARS 2019 2020 2021 2022 2023

Assets
Cash and balances with 163% 67% 67% 37% 100%
treasury banks
Balances with other banks 309% 199% 159% 348% 100%

Lending to financial -70% -59% -90% 110% 100%

institutions

Investments 140% 39% 36% -9% 100%

Advances 40% 45% 21% 10% 100%

Operating Fixed assets 220% 110% 96% 11% 100%

Deferred tax asset – net - - - -10% 100%

Other assets 321% 262% 227% 102% 100%

Total Assets 70% 53% 37% 15% 100%

Liabilities

Bills payable -4% 23% 22% -17% 100%

Borrowings 63% -17% 44% -13% 100%

Deposits and other accounts 60% 44% 27% 12% 100%

Sub-ordinated loans - - -70% 0% 100%

deferred tax liabilities - net 171% -63% 100% - -

Other liabilities 115% 148% 36% 30% 100%

Total Liabilities 59% 40% 9% 9% 100%

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 Represented By:

Share capital 62% 47% 47% 28% 100%

Reserves 186% 174% 153% 84% 100%

Unappropriated profit 7378% 4256% 2331% 2526% 100%

Surplus on revaluation of
60% 14% 79% -4% 100%
assets- net of tax
Total Liabilities & share 75% 100%
Capital

COMMENTS ON HORIZONTAL ANALYSIS OF BALANCE SHEET

TOTAL ASSETS
Total assets of Muslim Commercial Bank of Pakistan have increased from Year 2023 to
year 2019.

As compared to 2023
In Year 2022 there is increase of 15 % in total assets of the bank, this increase due to both
local currency current account and local currency deposit account with the treasury banks
maintain with SBP. The other reason of this increase is total assets is due to increase the
Lending to financial institution is 110% lending include call money lending and repurchase
agreement .Advances also increase 10% in the form of cash credit ,running finance and in
the form of loans and other assets also increase by 102% .
In year 2021 total asset increase by 37% as compared to 2023 and 22% increase as
compared to 2022. This increase is because of 67% increase in cash and balances with
treasury banks, 159% increase in balances with other banks. The other reason of this
increase in total assets increase in 21% Advances as compared to 2023 and 11% increase as
compared to 2022 due to increase in loans , cash credits and running finance .Investment
increase by 36% is 2021 as compared to 2023 due to major increase in market treasury bills
.Fixed assets also increase in 2021 is 96% as compared to 2023 due to capital work in

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progress and property and equipment ,other assets also increase 227% in 2021 as compared
to 2023 and this percentage increase is 125% in 2022 this major increase due to accrued
income in local currency and accrued income in foreign currencies.
In year 2020 total assets increase is 53% as compared to 2023 and this major increase due
to 67% increase in both local and foreign currency cash and balances with the treasury banks
, other assets increase in 262% in 2020 as compared to 2023 this major increase due to
accrued income in local currency and accrued income in foreign currencies .Investment also
increase is 39% due to increase in market treasury bills ,fixed assets also increase in 2020 is
110% as compared to 2023 due to capital work in progress and property and equipment.
Advances also increase 45% in the form of cash credit, running finance and in the form of
loans.

In year 2019 total assets increase is 70% as compared to 2023. This major increase due to
163% increases in local and foreign currency cash and balance with treasury bank in hand.
Investment increase 140% in 2019 as compared to 2023 due to major increase is market
treasury bills and Pakistan investment bonds. Fixed assets also increase in 2019 is 220% as
compared to 2023 due to capital work in progress and property and equipment. lending
decrease 70% as compared to base year, Advances are also increase 40% in the form of cash
credit ,running finance and in the form of loans ,other asset also increase 321% in 2019 as
compared to 2023 this major increase due to accrued income in local currency and accrued
income in foreign currencies.

TOTAL LIABILITIES

As compared to 2023
In year 2022 total liabilities have increased 9% because other liabilities increase 30% in
2022 although 17% bill payable decreased. Borrowing decrease by 13%. These bill payable
in Pakistan and outside Pakistan. These borrowings include borrowings from SBP. 12%
increase in deposits and other accounts due to major increase in fixed, saving, current
accounts remunerative and non-remunerative.

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In year 2021 total liabilities have increased 9% as compared to 2023 and as compared to
2022 there is no increase. 44% increase borrowing as compared to 2023 these borrowing
include secured and unsecured This is because of secured borrowings from the SBP under
export refinance scheme and long term financing under export oriented While call
borrowings (unsecured) also increased significantly projects have increased, deposit and
other account 27% increase as compared to 2023 deposit include customers deposit and
other financial institution deposit and other liabilities 36% increase.

In year 2020 total liabilities have increased by 40% as compared to base year and this
increase 31 %more than as compared to 2021 this major increase due to 23% bill payable
increase These bills are payable in Pakistan and outside Pakistan, deposit and other account
44% increase as compared to 2023 due to customers deposit and other financial institution
deposit are increase and other liabilities 148% increase as compared to 2023

In year 2019 total liabilities also increase 59% as compared to base year and this increase
19% more than as compared to 2020 due to major increase in 63% in borrowing, the bank
has entered into agreement with SBP with extending export finance to customers .As per the
terms of agreement, the bank has granted SBP the right to recover the outstanding amount
from the bank at the date of maturity of finance direct debiting the current account
maintained by the bank with SBP. Deposit and other account 60% increase as compared to
2023 due to customers deposit and other financial institution deposit are increase and other
liabilities 115% increase as compared to 2023.

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TOTAL SHARE CAPITAL

As compared to 2017
The Share capital refers to the portion of a Bank's equity that has been obtained by trading
stock to a shareholder for cash or an equivalent item of capital value. The share capital of
year 2016 Muslim Commercial Bank of Pakistan shows increasing trend this 28% increase
due to reserve increase 84% and inappropriate profit increase 2526%

In year 2021 share capital increase 47 % as compared to 2023. This increase is 19% more
than in 2022, reserve also increase 153%. Major change occur in unappropriate profit which
is increase by 2331% more than in 2023, Also an increase of 79 % of surplus on revaluation
of assets-net. In 2020 increase in share capital is 47% as compared to 2023, due to increase
in reserve 174% and major increase in unappropriate profit by 4256% as compared to base
year, this increase is 1925% more than in 2021.

In 2019 share capital increase 62% as compared to 2023; this increase is due to increase in
share capital issued for cash and as bonus shares, increase in reserve186% and unappropriate
profit 7378%.

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 4.5 HORIZONTAL ANALYSIS
OF
PROFIT & LOSS ACCOUNT

YEARS 2019 2020 2021 2022 2023

Mark-up / return / interest 190% 125% 79% 45% 100%

earned
Mark-up / return / interest 469% 315% 183% 63% 100%
expensed
Net mark-up / interest
139% 90% 60% 42% 100%
income

Provision for diminution in

1500% 2711% 106% -22% -100%
value of investments

Provision against loan &

366% 7% -138% -18% 100%
advances
Bad debts written off directly 3411% - -83% 3870% 100%

Net mark –up / return /

interest income after 103% 76% 50% 44% 100%
Provisions

Non Mark – up / Interest -2% 1% 12% -13% 100%

Income
Fee, Commission and 36% 20% 8% -6% 100%
brokerage income

Dividend income -4% 28% 32% 69% 100%

Income from dealing in

foreign -36% 37% 30% 30% 100%
currencies

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Gain on sale of securities -11% -14% 73% 30% 100%

Unrealized loss on
revaluation - 687% 100% - -
of investments
Other income -32% -21% -48% -47% 100%

Total non-mark-up / return 4% 7% 11% -8% 100%

/interest income

Non Mark-up / Interest

Expenses
Administrative expenses 56% 17% -22% 0% 100%

Other provisions –net 196% 32% -5% 16% -100%

Other charges 286% 357% 202% -63% 100%

Total non- mark-up /

63% 26% -10% 0% 100%
interest expenses

Profit Before Taxation 63% 68% 64% 42% 100%

Taxation 87% 58% 47% 55% 100%

Profit After Taxation 74% 72% 71% 36% 100%

COMMENTS ON HORIZONTAL ANALYSIS OF PROFIT & LOSS ACCOUNTS

As compared to 2023

In year 2022 profit increase by 36% as compared to 2023 .This major change due to Mark-
up /interest earned are increase 45% in 2022 as compared to 2023 and this increase due to
increase in loans and advances, deposit with customers and financial institution and on
securities purchased under resale agreements .

Total interest income are decrease 8% due to Fee, Commission and brokerage income
decrease 6%, Other income decrease 47% in year 2022 as compared to 2023 dividend

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income increase 69% and income from dealing in foreign currencies 30% and this increase
due to rent on property, profit on sale of property and equipment. Net markup/interest
income is increased by 42% while interest expense have increased by 63% due to increase in
deposits interest expense, on securities sold on repurchase agreement, on long term and
other short term borrowings, on securities sold under repurchase agreements. Profit before
taxation increase 42%, taxes increase by 55%. Profit after tax has increase 36% in this year.

In year 2021 profit increase by 71% as compared to year 2023. This increase in profit is
35% greater than in 2022. This major change due to Mark-up/interest earned increase 79%
as compared to 2023 and 34% increase to 2022 due to loans and advances from customers
and financial institutions and on investment in available for sale securities and associates, on
deposits with financial institutions, on discount income and on securities purchased under
resale agreements.Net markup/interest income is increase by 60% which is 18% more than
in 2022 while interest expense also increase 183% due to securities sold under repurchase
agreement, short term borrowing and long term borrowing . Provision against loans
advances decrease 138% as compared to year 2023. Interest income after provision are also
increase 50% in this year. Other income decrease 48% in 2021 as compared to 2023 because
in 2021 profit on sale of property and equipment are decreases. Total interest income 11%
increase as compared to 2023 due to gain on sale of securities increase 73%, fee,
commission and brokerage income and dividend income are increase , total interest expense
decrease 10% in this year .Profit before taxation increase 64% as compared to 2023 .This
increase is 22% more than in 2022. Taxes increase by 47%. Profit after tax has increase
71%.

Mark-up/interest earned increase 125 % in 2020 this increase due to increase in interest
earned on loans and advances from customers and financial institutions, and interest earned
on investment .Net markup/Interest income increased 90% as compared to 2023 while
interest expense increase 315% due to major increase in interest expense on deposits, on
securities sold under repurchase agreements and on long term borrowings. In this year other
income also increase due to rent on property, profit on sale of property and equipment Total

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income increase 7% as compare to 2023 this change due to increase fee, commission and
brokerage income is 20% and dividend income is 28% increase, income from dealing in
foreign currencies increase 37% Profit before taxation increased by 68% as compare to 2023
.Taxes increase by 58%. Profit after taxation is increase by 72%.

In year 2019 Mark-up/interest earned increase 190 % in this year this increase due to
increase in interest earned on loans and advances from customers and financial institutions,
and interest earned on investment .Net markup /Interest income increased 139% as
compared to 2023 .while interest expense increase 469% due to major increase in interest
expense on deposits, on securities sold under repurchase agreements and on long term
borrowings. Total income increase 4% as compare to 2023 this increase due to increase fee,
commission and brokerage income is 36% and dividend income is 4% decrease, income
from dealing in foreign currencies decrease 36%.Profit before taxation increased by 63% as
compare to 2023. Taxes increased by 87%. Profit after taxation increase by 74%.

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4.6 VERTICAL ANALYSIS OF

BALANCES SHEET

YEARS 2019 2020 2021 2022 2023

…………………….Rupees in 000……..………………..

Assets

Cash and balances with 8% 9% 10% 9% 8%

treasury banks
Balances with other banks 1% 1% 1% 2% 0%

Lending to financial 1% 1% 0% 6% 3%
institutions
Investments 33% 22% 28% 19% 23%

Advances 50% 59% 53% 58% 60%

Operating Fixed assets 4% 4% 4% 3% 3%

Deferred tax asset - - - 0% 0%

Other assets 5% 4% 4% 3% 2%

Total Assets 100% 100% 100% 100% 100%

Liabilities

Bills payable 2% 2% 3% 2% 3%

Borrowings from financial

9% 5% 10% 7% 9%
institution
Deposits and other
72% 74% 71% 75% 77%
accounts

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 Sub-ordinated loans - - - 0% 0%

Deferred tax liabilities 1% 0% 0% - -

Other liabilities 3% 5% 3% 3% 3%

Total Liabilities 86% 87% 87% 88% 92%

Represented By:

Share capital 1% 1% 2% 2% 1%

Reserves 8% 8% 8% 7% 4%

Unappropriated profit 3% 2% 1% 2% 0%

Surplus on revaluation of 2% 1% 2% 2% 2%
assets- net of tax
14% 13% 13% 12% 8%

Total Liabilities & share 100% 100% 100% 100% 100%

Capital

COMMENTS ON VERTICAL ANALYSIS OF BALANCE SHEET

TOTAL ASSETS

Here are following Total Assets includes: Current Assets + Fixed Assets + Other Assets. Where
Current Assets include: All assets excluding Fixed Assets and Other Assets Current assets of the
bank has same in 2023 and 2022 is 94% because cash and balance with treasury bank and balance
with other banks has increase in 2022. Investment are decrease in 2022 but lending to financial
institution increase in this year and advances are decrease 2% in thi year If current assets fall
short more than this in future, then the bank will have to scramble for other sources of short-term
funding, either by taking debt.

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In 2021 currents assets are decrease because balance with other banks and advances are decrease
but in this way cash utilized in purchasing operating fixed assets are 1% increase as compared to
2022 fixed asset are increase is due to increase in capital work-in-progress, property and equipment.
Fixed assets are the long-term base of the bank’s operation strategy, represented by all the
equipment, facilities, IT infrastructure and long-term contracts the bank has invested in to conduct
business. These assets are the revenue generators, which together form the base from which the
company functions from week to week. So these are also well handled by the bank.

In 2020 and 2019 current assets are also decrease due to shortage of cash and balance with treasury
bank and balances with others banks but in the other hand cash utilized to purchase other asset
This increase in other assets is due to increase in Income / mark-up accrued in local currency and
income / mark-up accrued in foreign currency

TOTAL LIABILITIES

Total liabilities of the MCB have decreased in year 2022 as compared to 2023 but this decrease is
not too much high.

In year 2021 total liabilities have decreased because in this year deposit are decrease Money
deposited with a bank becomes a liability of the bank, because the bank has an obligation to pay the
depositor the money deposited; usually on demand, although bill payable, borrowing slightly
increase. (The money deposited is an asset for the depositor; but this asset will not be recorded by
the bank because it is not the bank's asset. This shows that bank’s need more debt from other
financial institutions from 2023 to 2021 especially.

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Total liabilities have sustained in 2020 as compared with 2021. This increase is due to increase in
others liabilities, deposits. Borrowings from financial institutions decrease. While these borrowings
have been made from SBP for providing financing facilities to customers for import of machinery,
plant, equipment the bank has entered into agreement with the SBP for extending export finance to
customers. And these bills are payable in Pakistan and outside Pakistan. However there is no major
increase found in the bank’s liabilities portion. Liabilities increase also shows that bank’s need more
funds in these years to complete its higher operational activities and year 2019 total liabilities also
decrease because in this year bill payable and borrowing are decrease and deposit are slightly
increase

OWNER’S EQUITY OR SHARE CAPITAL

Share capital or issued capital or capital stock refers to the portion of a company's equity that has
been obtained (or will be obtained) by trading stock to a shareholder for cash or an equivalent item
of capital value. Share capital has increase from 2023 to 2022 this increase is due to unappropriated
profit are increase , in 2021 share capital are sustained due to reserve are increase.

In 2020 share capital are decrease because reserve and unappropriated profit not increased in the
year 2019 share capital are sustained due to unappropriated profit reserves are stable not increasing
neither decreasing.

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 4.7 VERTICAL ANALYSIS
OF
PROFIT & LOSS ACCOUNTS

2019 2020 2021 2022 2023

........................Rupees in 000………………..

Mark-up / return / interest 90% 87% 84% 84% 76%

earned
Mark-up / return / interest -28% -25% -21% -15% -12%
expensed
Net mark-up / interest income 62% 62% 63% 69% 64%

Provision for diminution in

3.55% 8.81% 0.46% 0.65% -
value of investments

Provision against Loans &

13.87% 4.38% 13.13% 5.44% 8.5%
advances
Bad debts written off directly 0.09% - 0% 0.25% 0%

Net mark –up / return /

interest income after 49% 53% 55% 65% 59%
Provisions
Non Mark – up / Interest
Income
Fee, Commission and 5.11% 6.44% 6.97% 7.51% 10.56%
brokerage income
Dividend income 0.96% 1.34% 1.67% 2.63% 2.07%

Income from dealing in foreign 0.59% 1.58% 1.83% 2.24% 0.59%

currencies
Gain on sale of securities 1.35% 1.61% 3.97% 1.96% 3.74%

Unrealized loss on revaluation - -0.22% - - -

of investments
Other income 1.28% 1.86% 1.49% 1.85% 4.68%

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 Total non-mark-up / return / 10% 13% 17% 16% 24%
interest income

Non Mark-up / Interest -19% -18% -16% -21% -28%

Expenses
Administrative expenses 24% 24.77% 22.28% 34.8% 44.28%

Other provisions / write offs – 0.34% 0.07% 0.01% 0.06% -

net
Other charges 1.76% 2.68% 2.39% 0.35% 1.22%

Total non-mark-up / interest

expenses
Profit Before Taxation 40% 48% 56% 60% 55%

Taxation -13% -14% -16% -21% -17%

Profit After Taxation 27% 34% 40% 39% 38%

COMMENTS ON VERTICAL ANALYSIS OF PROFIT & LOSS ACCOUNTS

Net markup /interest income have decreased from 69% to 62% from 2022 to 2019. In 2019 interest
income is 90% while this percentage is 84% in 2022 and 72% in 2023. Net markup / return / interest
income after provisions have also decreased but this decrease is due to increase in provision against
loan and advances by 13% in 2019.

Interest expend, markup also increase from 12% to 28% this is directly link with interest earned, if
interest / markup earned increase interest expense increase.

Total income has increasing trend in 2023 to 2019. This increase is due to major increase in interest
earned. Administrative expenses have decreased from 2023 to 2019. This decrease in administrative
expenses due to better management of the bank. Profit before taxation is 40% in 2019 while this
percentage is 55%in 2023. Profit after tax has a trend of decrease. In 2023 profit after tax has 38%
while this percentage is 27% in 2019.

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 4.8 ORGANIZATIONAL ANALYSIS
(COMPARISON WITH OTHER BANKS)

MCB Comparison with United Bank Limited & National Bank of Pakistan

Particulars MCB UBL NBP

(Rupees in ‘000)

Deposits 367,604,711 492,036,103 726,464,825

Advances 253,249,407 354,091,713 475,243,431

Profit 15,495,297 9,192,687 18,211,846

Liabilities 439,484,714 558,807,328 824,676,384

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GRAPHICAL REPRSENTATION

DEPOSITS
800,000,000

700,000,000

600,000,000

500,000,000

400,000,000
DEPOSITS
300,000,000

200,000,000

100,000,000

0
MCB UBL NBP

ADVANCES
500,000,000
450,000,000
400,000,000
350,000,000
300,000,000
250,000,000
ADVANCES
200,000,000
150,000,000
100,000,000
50,000,000
0
MCB UBL NBP

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 LIABILITIES
900,000,000
800,000,000

700,000,000

600,000,000

500,000,000

400,000,000 LIABILITIES

300,000,000
200,000,000

100,000,000

0
MCB UBL NBP

PROFIT
20,000,000
18,000,000
16,000,000
14,000,000
12,000,000
10,000,000
PROFIT
8,000,000
6,000,000
4,000,000
2,000,000
0
MCB UBL NBP

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 4.9 FUTURE PROSPECTS OF MCB

MCB team committed to taking the Bank to the next levels of success. Key features of multi-
pronged plan are as follows:

 MCB wants to be viewed as the leader in transactional convenience. To get top

market share, they will continue to invest in alternate channel payment capabilities
and services as well as getting a larger share of transaction driven businesses like
remittances, cash management, payroll and trade.

 Managements want to continue to invest in branches to make them more sales and
service oriented. Through introduction of new sales and service model, strengthened
transaction processing and leading financial products menu, aspire to achieve this
ambition.

 Management core focus on mass, mid-market and corporate segments, continue

down the path of further segmenting customer needs and developing focused
customer propositions, particularly in Privilege, Islamic & SME.

 Not any organization can deliver without investing in its employees. In order to
achieve growth targets, management have to further strengthen reserve of talent and
leadership powered by a strong performance culture and training.

 Finally, for an organization, controls and efficiency is central to existence.

Management’s strategy to build stronger controls, develop a unit cost culture.
MCB’s strengths in terms of its franchise, balance sheet and reputation are unparalleled. Entire team
task is to ensure that continue to go from strength to strength. Bank’s performance in 2019 is an
attestation of the commitment & passion that the team brings to MCB and the strong support of the
shareholders.

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 4. WEAKNESSES OF THE ORGANIZATION

 Income / expense ratio decreasing from last three years its alarming situation for a bank

2018 5.06
2019 4.10
2020 3.84

 The efficiency of banks can be measured through the use of the return-on-equity (ROE)
ratio, which shows to what extent banks use reinvested earnings to produce future profits.
MCB (ROE) decreasing consecutively from last three years.

 Profit before tax PBT/Total income ratio decreased from 63.30% to 55.91% in 2019.
 (ROA) return on average assets also decreased from 3.60% to 3.25% as compared to
last year.
 (ROCE) return on capital employed decreased from 31.49% 2020 to 27.35% 2019.

 MCB poorly managing their operating expenses. Operating expenses before pension
fund (PF) reversal rose by 7.8% to Rs. 14.9B from Rs. 13.8B in 2020. Due to rising
inflationary pressures coupled with additional expenditure on insurance and security
companies, the administrative expenses rose by only 8.4% to Rs. 14B in 2019.
 Borrowing from other financial institutions increasing from 22,664 to 44,662 in 2019.
 Cash dividend per share decreased from 11.50 (2020) to 11.00 (2019).

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 5. Overview of the Department(s) Where You Served Internship
 Number of employees working in the Department
There are three members working in customer service department in MCB bank Wazirabad Branch.
 Functions and operations
I Works as an intern in MCB bank Wazirabad branch. Customer Service Department Function and Operation to
facilitate old-age citizen like help to filling Deposit slips, bio-matric, documentations, new Account opening
and apply new cheque book etc.
 Weaknesses:
 To many paper work which is much time consuming
 Mismanagement of time is the biggest mistake in MCB branches that the official time of
bank closing is 5:30pm but the staff is normally on their seats till 7:00pm to 9:00pm.
 In almost every branch it is also seen that the staff complain about over loaded of work. It is
the reason that turnover ratio of MCB is increasing.
 Unattractive infrastructure of the branch (currently)
 Employees at branch level are not properly motivated to work by heart. They take the all
routine activities as a boring job.

6. Responsibilities as a student Intern

 Duties

I worked as an internee in MCB for four weeks as per required by the University. During my
internship there was tremendous and friendly atmosphere in MCB. I learned so many things from their
management like how to work in a standard place.
At my first day in MCB, the branch Relationship manager Mr. Bilal Asghar introduced me to all the
employees in the bank. After that I was handed-off to Mr. Kamran Butt, he is the sales Manager, he
was very responsible for my learning in the bank.

I worked under her for two weeks. After that I moved besides Customer Service Officer. She was
very helpful and friendly. She provided me with all the information that I asked for and co-operated
with me very much.
The most important benefit of internship is that I got practical expoure of workplace. I got practical
experience of working practices related with my field.

I learned process of account opening of individuals, checked vouchers, issued cheque books and recorded
them, issued ATM cards and kept record of them, learned about different types of ATM cards, filled online
and deposit slips, filled issuance of Visa Debit Card form, filled cheques of customers who did not knew
how to fill a cheque. I also learned about Authorized signatures. I also learned how to do marketing of a
product in 1 minute. I learned how to use photostate machine and scanner.
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During my internship, I dealt with many customers and that was a great experience to learn:
• How to deal with customers.
• How to work under pressure i.e. in rush hours.
• How to manage an office.
• My communication skills were improved.
• My confidence level boosted up.
 Accomplishments
 During my internship at MCB Bank, I gained valuable experience by actively participating in various
customer service and operational tasks. Early on, I learned how to conduct the biometric verification of
customers, which is an essential step for account authentication, and I also assisted customers in signing up
for their accounts on the banks online app, ensuring they could access digital banking services efficiently.
 I regularly interacted with customers, assisting them in filling out deposit slips and supporting them through
the process of opening new accounts. This experience sharpened my communication skills and helped me
develop a deeper understanding of customer needs and banking procedures.
 I learned how to process cheque book requests. I became familiar with the documents required for this
service and effectively guided customers through the application process.

 Problems encountered
 As an intern I faced challenge to Managing the high volume of customer queries and Document while
maintaining confidentiality and Follow to strict banking regulations and compliance standards. During
internship I Face another challenge to developing effective communication skills to interact with diverse
customer profiles, including resolving queries and addressing concerns.
 In short time I faced challenge balancing multiple responsibilities while maintaining accuracy and meeting
deadlines.
 Internship experience impacts my career

My internship at MCB Bank provided hands-on experience in the banking sector, enhancing my
understanding of how to deal customer in busy days. It allowed me to develop key skills such as teamwork,
communication, and problem-solving. This experience significantly boosted my confidence and
employability in the competitive finance industry.

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 7. CONCLUSION

The banking system, as a whole, remains healthy despite the economy going through a period of
economic difficulty. The banking sector absorbed the build-up of non-performing loans in the
system while maintaining profitability and robust balance sheets. Much of the credit for this must go
to the SBP for the policies it has pursued over the last decade to ensure that banks are adequately
capitalized and adhere to prudent risk management.
The objectives were targeted towards customers, improved management policies, strong policy
framework, improved governance structure, strategic investment initiatives and implementation of
cost effective measure across bank. The group structure of the bank individually worked hard in
achieving the milestones under continuous monitoring and supervision of the senior management
and Board.
The bank displayed extraordinary results in both financial and non-financial terms. With the banking
industry recovering at a steady pace since the 200 crisis, MCB ensured availing all possible positive
opportunities and delivered substantial profits ensuring sound asset growth Financial year 2019 MCB
stood up to the challenges and produced significant increases in major areas of its business while
maintaining higher profitability, stronger asset base with corresponding increase in equity. The
sector also made positive recoveries while heading towards its actual position prior to 2021 and 2020
financial market crisis.
MCB registered continuous positive performance, by delivering PBT of Rs. 23B and PAT of Rs.
15B, with a rise of 6% and 1% respectively, over 2020. Interest Income increased by 29% to Rs.
52B over Rs. 40B in 2020 owing to increased volume and yields. Income earned on advances,
representing 70% of the total Interest Income, increased by 21% over Rs. 30B in 2020, to Rs. 36B in
2019. Interest Expense however, also simultaneously increased by 37%, owing mainly to the
increased cost of deposits with interest expensed on deposits rising by 47% to Rs. 14B in 2019.
Despite this, due to larger proportion of Interest Income,

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the resultant Net Interest Margin (NIM) of Rs. 36B significantly rose by Rs. 7B, 26% rise over Rs.
28B last year.

The Bank's outstanding performance resulted in improved efficiency and profitability ratios, stable
market share, and attractive share price at the close of the year 2019 combined with a high Break-up
Value (before surplus) of 88.37 per share.
Consequent to the average increase in balance sheet footing and equity of 12% and 16%
respectively, return on assets and return on equity were reported at 3.25% and 27.35% respectively.

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8. RECOMMENDATIONS

Following are some of the suggestions and recommendations that I want to give on the basis
of shortfalls / weaknesses found in the bank.

 The target rate of return on assets (ROA) of commercial banks reflects the
effectiveness and efficiency of the use of resources is the embodiment of its
operating efficiency and management level of the important comprehensive index.
Emphasis on return on assets, and continuously improve the return on assets and
achieve an operating profit maximization should be the primary objective of
Muslim commercial bank.
 A strong ROE is a solid signal that management is doing a good job of generating
returns for shareholders' investments. Active capital management activities will
provide better ROEs. Bank that manages larger reserves due to recent or future
investment projects will stymie their ROEs. Another determinant of the ROE is the
operating profit margin of banks. Recently, this tends to converge towards non-
interest income as net interest margins tend to cause net interest income to be
squeezed over time due to rising competition. Muslim Commercial Bank should
Enable to raise their operating profit margins can smoothly enhance their ROEs.
Loans with higher returns will produce better profit opportunities. Alternatively, may
diversify earnings through transaction and recurring non-interest income activities.
MCB’s can expand more differentiated products, such as wealth management and
insurance to improve their ROE position.

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 Profit before tax ratio 55.91% in 2020 which is 7% lower than in that of last year mainly on
account of higher administration cost and provision charge so MCB should control its
interest expenses.
 The Bank's controlled budgeting and diligent monitoring on operating expenditure
block. Effective monitoring at management level ensured managed increase in
administrative charge within the approved budgetary limits.
 Borrowing from other financial institutions increasing from 22,664 in 2019 to 44,662
in 2020 and deposits decreasing the bank should develop strategy, employs the
policy and emphasized to increase deposits reserves that enable to reduce
borrowings.
 MCB’s lead over rivals if they more emphasis on its aggressive investment strategy
and capital strength, the investments may bolster MCB’s.
 MCB Bank Ltd Pakistan’s largest lender by market value should plans to expand
overseas and add branches and employees at home even as economic growth slows
after the worst floods in the nation’s history. Increase staff as it expands trade
financing, remittances management and mobile-banking operations.

 Better managed expense-to-income ratios will then produce higher operating profit margins.
Banks that use capital more efficiently will have better financial leverage and thus, higher
ROEs. A higher financial leverage multiplier would show that banks are able to leverage on
a smaller base of stakeholders funds to produce interest bearing assets that optimize earnings
 Efficient cost-control procedures may limit the growth of operating expenses leading
to higher operating profit margin. Banks poorly managed their operating expenses.
Further improvement may be necessary to enhance ROE development.

 MCB Islamic Banking needs a research, which should be engaged in evaluating and
interpreting the ways in which the bank can flourish more and more.

 In Agriculture loan Sector, MCB mainly serving in Punjab province. Agriculture

loans facility should be provided to all other provinces of Pakistan as well.

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 The bank should emphasis on the organization of effective training and development
programs for its new as well as existing employees so that these are gradually
updated regarding the recent developments in the field of banking.

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 9. ANNEXES

ORGANIZATIONAL STRUCTURE

Board of Directors

Chairman

President

Audit & RAR Wholesale Banking Consumer Banking Islamic Banking Commercial Banking Treasury & Forex

Special Assets Public Relations Risk Management Compliance & Strategic Planning Financial Control
Management Control & Investment

Information Project Human Resource Operations Business Development and

Technology New Initiatives
Management Management

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 MANAGEMENT OF BRANCH
General Manager Commercial

Regional Operational Regional Head / VP

Manager / VP

Branch Operational Branch Manager /

Internal Control Manager / OG III VP
Officer / OG I

GEN.BANKING DEPTT CASH DEPTT CREDIT DEPTT

Incharge Forex OGIII

Branch Supervisor / OGIII Chief Teller/Assistant Credit Officer / OGIIII

GBO - Transfer / OG-III Teller Outsource

B
R
Personal Banking
A GBO- Remittance / OG-I Teller Outsource Advisor
N
C
H GBO- Clearing / OG-II Personal Banking Personal Banking
Advisor-OGIII Advisor-OGII

Customer Service Customer Services

Officer Officer

Support Staff Security Staff

Tea Boy Outsource Guard MCB Foundation

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10. REFERENCES

All of the references and sources from where the data gathered for this report are mentioned
herewith for your kind concern.

ORGANIZATION

Annual Reports of MCB Bank Limited of Pakistan.

MCB Credit Policy

http://www.mcb.com.pk.

WEB PORTALS

http://www.sbp.com.pk

http://www.ibp.org

http://www.thebankers.com

http://www.finance.gov.pk

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End

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