Intrnship Report Mcb

8/3/2019 Intrnship Report Mcb

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1 INTERNSHIP REPORT

D E D I C A T I O NDedicated to my

Loving parents,

My brothers & sisters,

My respected and venerable teachers,

My friends,

&

All to all those who are praying for my success


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2 INTERNSHIP REPORT

TABLE OF CONTENTS

ACKNOWLEDGEMENT 5

EXECUTIVE SUMMARY 6

OUR VISION & MISSION 6

VISION STATEMENT 6

MISSION STATEMENT 7

HISTORY OF BANKING 8

EVOLUTIONOF BANKING 8

EARLY GROWTH 8

DEVELOPMENTOF MODERN BANKING 9

BANKING IN PAKISTAN 10

MCB BANK LIMITED 13

BRIEF HISTORYOF MCB: 13

ABOUT MCB 13

OUR VALUES 15

CORPORATE PROFILE 16

BOARDOF DIRECTORS................................................................................................................... 16HIERARCHYOF MCB 19

MCBS AWARDS AND ACHIEVEMENTS 21

STRUCTUREOF MCB AYUBMEDICALCOMPLEXBRANCH 23

ABBOTTABAD. 23

23

OVERALLPERFORMANCE OF MCB IN 2010 24

RESERVE FUND/EQUITY................................................................................................................. 24DEPOSITS.....................................................................................................................................24ADVANCES...................................................................................................................................24INVESTMENTS............................................................................................................................... 24YEAR2010 COMPLIANCE...............................................................................................................25

MCBS DEPARTMENT 27

ACCOUNTS DEPARTMENT 27

CURRENT DEPARTMENT 28

PROFIT & LOSS SHARING (PLS) ACCOUNT ..................................................... ........ ....... ..32SAVING 365 ACCOUNTS .......................................................................................................33REMITANCES DEPARTMENT 36

DEMAND DRAFTS (DD) ............................................................................................................... ..37CASH DEPARTMENT 40

CASH PAID SHEET........................................................................................................................ 40CASH RECEIVED........................................................................................................................... 41ADVANCES DEPARTMENT 43

PREPARATION OF CREDIT PROPOSAL ............................................................................ ..43ADVANCES TYPES .............................................................................................................. ..44COMMERCIAL ADVANCES ..................................................................................................44CLEARING DEPARTMENT 47

ADVANCE CLEARING..................................................................................................................... 49


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C) CHEQUE COLLECTION................................................................................................................50REASONSFORCHEQUERETURNEDUNPAIDIN CROSS CHEQUES............................................................... 52REPORTOF LOSTORSTOLENCHEQUE ...............................................................................................53GREEN SHEET.............................................................................................................................. 53RTC DEPARTMENT 53

IMPORTANT FEATURES....................................................................................................................53ASGOODASCASH.........................................................................................................................53DENOMINATIONS .......................................................................................................................... 54EASILY ENCASHED........................................................................................................................ 54EASILYREFUNDABLE...................................................................................................................... 54EXCLUSIVE SECURITY FEATURES...................................................................................................... 54VALID UNTIL USED .....................................................................................................................54TELEVERIFICATION SYSTEM .......................................................................................................... 54PROCEDURE 54

SWOT ANALYSIS 56

LEARNING AS INTERNEE 61

DUTIES & ACCOMPLISHMENTS 61

CONCLUSION 62

RECOMMENDATIONS 63

APPENDIX 64


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4 INTERNSHIP REPORT

PREFACE

This question always seems to be arising in the minds of the students whenthey are to join some organization in order to comply with the compulsoryrequirement of Internship Experience of at least six weeks. Every studenteither verbally or non-verbally seems to be saying: What is the need of this

break in our smooth sailing educational life. After all Why???.......................

But they come to know the purpose once they join in some organization tohave a taste of actual life. Student life is a period of preparation for theupcoming future. In this period one is expected to make all rounddevelopments-mental, moral, and physical. Life is a struggle and a kind of

battle. This internship programme is to prepare us for this battle. Just as asoldier is not sent to the fort without proper training, in the same way, astudent is not fit to enter the battle of life without an adequate training for it-a training of head and heart.

The true aim of the Internship Programme is to stuff the brain with all sortof facts and formulae, or to familiarize the mind with infinite things neverhandled, the places never saw, or the statements of facts never tried tounderstand. During this six weeks long practical glimpse, the theories andideals which we received from the books have been woven in the texture of

our actual life. No doubt, it has helped us in cultivating the qualities ofcourage, hope, initiative, and the capacity to turn our knowledge to practical

purposes. It has worked towards the development of all the factors of ourlife, character and personality, so that at the end of our educational career,we may turn out as useful citizen, inspired leaders and successful businessexecutives of the country.


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5 INTERNSHIP REPORT

AACKNOWLEDGEMENTCKNOWLEDGEMENT

I am very thankful to Almighty Allah the most merciful and beneficent who makesme able to complete my internship successfully.

I am also grateful to the department of administrative Sciences of Govt college ofmanagement sciences Atd who gave us an opportunity of internship to enhance ourcapabilities. This internship programmed is very much helpful for me because, Ihave learnt a lot by applying theoretical knowledge in practical field. I would alsoshow my gratitude to the co coordinator of Department of Administrative SciencesMr. shahid mehmood

I am also grateful to all the employees of MCB Bank who guide me during thecourse of internship. The behavior of all the department supervisors is very goodto me because they gave me a lot of time to guide me the mechanism of alldepartments in which I worked. I am also thankful specially to branch managerMr.Amjad and operation manager Mr.Naik Muhammad for sharing theirexperiences with me.


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EEXECUTIVEXECUTIVE SSUMMARYUMMARY

MCBBank Limited (Formerly Muslim Commercial Bank Limited) MCB is oneof the leading banks of Pakistan with a deposit base of about Rs. 280 billion andtotal assets of around Rs.300 billion. Incorporated in 1947, MCB soon earned thereputation of a solid and conservative financial institution managed by expatriateexecutives. In 1974, MCB was nationalized along with all other private sector

banks.

The Bank has a customer base of approximately 4 million and a nationwidedistribution network of 1,026 branches, including 8 Islamic banking branches, andover 300 ATMs, in a market with a population of 60 million.

During the last fifteen years, the Bank has concentrated on growth throughimproving service quality, investment in technology and people, utilizing itsextensive branch network, developing a large and stable deposit base.

MCB's operations continued to be streamlined with focus on rationalization ofexpenses, re-alignment of back-end processing to increase productivity,enhancement of customer service standards, process efficiency and controls. TheBank has taken the lead in introducing the innovative concept of centralizingTrade Services in the country by providing centralized foreign trade services to

branches with a view to improve efficiency, expertise and reduce delivery cost.

During my internship in MCB I worked in Remittances and Customer ServiceOffice department and I successfully completed all the task/duties that wereassigned to me.

During the course of internship I learned about different functions performed byRemittances and Customer Service Office department and bank as a whole. I alsolearned banks correspondence with their customers and within branches. I learnedabout documentation requirements and record keeping for different activities and

processes, especially the documentation requirement for different kinds offinancing facilities

OUR VISION & MISSIONOUR VISION & MISSION

VVISIONISION SSTATEMENTTATEMENT


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To be the leading financial services provider, partnering with our customersfor a more prosperous and secure future.

MMISSIONISSION SSTATEMENTTATEMENT

We are a team of committed professionals, providing innovative and efficientfinancial solutions to create and nurture long-term relationships with ourcustomers. In doing so, we ensure that our shareholders can invest withconfidence in us.


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HISTORY OF BANKINGHISTORY OF BANKING

Evolution of BankingEvolution of BankingIt has not so far been decided as to how the word Bank originated. The

explanation of this origin is attributed to the fact that the jews in Lombardy

transacted the business of money exchange on banches in the market place and

when the business failed, the people destroyed the Bank. Incidentally, the word

bankrupt is said to have been evolved from this practice. The opponents of this

opinion argue that it was so, then how is that the Italian moneychangers were

never called Banchierei in the Middle Ages?

Other authorities hold the opinion that the word Bank is derived from the

German word back which means joined stock fund. Then Back was Italianize

into Bank.

Early GrowthEarly Growth

Banking in fact is as primitive as human society for eversince man came to

realise the importance of money as a medium of exchange. Perhaps it was

the Babylonians who developed banking system as early as 2000 B.C. It is

evident that the Temples of Babylon were used as Banks because of the

prevalent respect and confidence in the clergy.

King Hamurabi ( 1728 1686 B.C ), the founder of the Babylonian empire,

drew up accede where in he laid down standard rules of procedure for

banking operations by temples and great landlords. He got his code inscribed

on the block of diorite about 8 feet tall, containing about 150 paragraphs

which deals with nearly all aspects of loans, interest, pledges, guarantees,

natural accidents, loss, theft etc. Later on Sumerians, Babylonians, Hitties

and Assyrians standardised the values of the goods in silver, copper and

bronze.


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It is not certain as to whom invented money but history recess that king of

Lydia castled electrum ingots of identical shapes and of uniform weights

with a triple emblem engraved on it as an official guarantee of value in 687

B.C. In 1401 a German public bank was framed comprising the operations of

discounting and transferring of money. By the 16th century, some more

public banks were formed in Venice, Milan, Amsterdam, Hamburg and

Nuremburg. In order to streamline Banking organisations and techniques,

conferences were held in Nuremburg from 1548 to 1551 and it was agreed

that the commercial interest of the time needed a bank with facilities of

growth and transfer but it should not be a bank run by private individuals.Ultimately in 1587, a State Bank under the name of banco DI rialto was

formed in Genoa. Later the bank of Amsterdam was also formed in 1609.

This Bank had a guarantee by the State and rendered valuable services to the

Netherlands traders upto the year 1795.

Similarly in 1690, the Bank of Hamburg came into existence in Hamburg

with the business of accepting deposits of fine silver or of foreign money andto run accounts on these deposits. This Bank rendered great service to the

merchants as well as countries it dealt with until 1873, when it was merged

with the Reich bank. By the year 1700, the bank of England was not only

issuing notes but also conducting accounts for customers. Its directors were

conducting the business like that of limited companies. The bank had the

monopoly of issuing banking notes. Upto 1813 or there about in England, the

main profit of bank was derived from the circulation of notes.

Development of Modern BankingDevelopment of Modern Banking

In 1918 came into being eleven clearing banks of today. The effect of this

historical development of banking in England has been fairly wide. First,

emergence of a small number of large banks with wide network of branches.


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Second, increase in the popularity of bank accounts and a large-scale use of

cheques.

In 1946, the labour government nationalised the bank of England and

transferred the existing stock to the nominee of British treasury. In 1955, the

British Banks made a departure from traditional banking by undertaking

hire-purchase finance for companies buying industrial plants and machinery

and took interest on hire-purchase finance.

Banking In PakistanBanking In Pakistan

At the time of independence, there were 631 offices of scheduled banks in

Pakistan, of which 487 were located in West Pakistan alone. As a new

country without resources it was very difficult for Pakistan to run its own

banking system immediately. Therefore, the expert committee recommended

that the Reserve Bank of India should continue to function in Pakistan until

30th September 1948, so that problems of time and demand liability, coinage

currencies, exchange etc. be settled between India and Pakistan. The non-Muslims started transferring their funds and accounts to India. By the end of

June 1948 the number of officers of scheduled banks in Pakistan declined

from 631 to 225. There were 19 foreign banks with the status of small

branch offices that were engaged solely in export of crop from Pakistan,

while there were only two Pakistani institutions, Habib Bank of Pakistan and

the Australasia Bank. The customers of the bank are not satisfied with the

uncertain condition of banking. Similarly the Reserve Bank of India was not

in the favour of Govt. of Pakistan. The Govt. of Pakistan decided to establish

a full-fledge central bank. Consequently the Governor-general of Pakistan

Quaid-I-Azam inaugurated the State Bank of Pakistan on July 1, 1948. Thus

a landmark was made in the history of banking when the state bank of

Pakistan assumed full control of banking and currency in Pakistan.

The banking structure in Pakistan comprises of the following types.


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1) State Bank of Pakistan.

2) Commercial Bank of Pakistan.

3) Saving banks.

4) Co-operative banks

5) Specialised credit institutions.

Up to December 31, 1973, there were 14 Pakistan commercial banks that

functioned all over the country and in some foreign countries through a

network of branches. All these commercial banks were nationalised in

January 1, 1974, and were recognised and merged into the following five

banks:

1) National Bank of Pakistan

2) Muslim commercial bank limited

3) Habib Bank Limited

4) United Bank Limited

5) Allied Bank of Pakistan

The state bank of Pakistan is the Central bank of the country and was

established on July 1, 1948.The separation of East Pakistan and its

repercussion in the form of economic depression has caused a lot of

difficulties to the banking system in Pakistan. The network of bank branches

now covers a very large segment of national economy. The numbers of

branches have increased appreciably and there is now on branch of bank for

every 3000 heads of population approximately. There is done reasonable

growth in deposits from the establishment of Pakistan. Besides this growth,

specialised credit and financial institutions have also developed over the

years.

The Government of Pakistan in the late 90s introducing the need for the

privatisation of state owned banks and companies. The private sector has


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accepted the challenge and most of the banks are privatised today. The State

Bank of Pakistan issues the shares of these periodically. Bank employees

and other common peoples can also purchase these shares and earn profit.


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MCB BANK LIMITEDMCB BANK LIMITED

BBRIEFRIEF HHISTORYISTORYOFOF MCB:MCB:

MCB Bank limited formally known as Muslim Commercial Bank (MCB)

unfolds 52 years of growth. MCB is not an overnight success story. The

bank started corporate life in Calcutta on July 9, 1947. After the partition of

the Indo-Pak Subcontinent, the bank moved to Dhaka 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 52-year legacy of trust in its customers and the

citizens of Pakistan.

Nationalization

In January 1974, the Government of Pakistan nationalized MCB following

the banks (Nationalization) Act 1947, Premier Bank Limited merged with

MCB.

PRIVATIZATION

A wave of economic reforms swept Pakistan in the late 1990, introducing the

need for privatization of state owned banks companies. In April 1991, MCB

became Pakistans first privatized bank. The government of Pakistan

transferred the management of the Bank to National Group, a group of

leading industrialists of the country by selling 26% shares of the bank.

In terms of agreement between the Government of Pakistan and the National

Group, the group, making their holding 50% has purchased additional 24%

shares. Now, 25% is purchased by the Government, which shall be sold in

the near future.

ABOUTABOUT MCBMCB


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MCB is one of the leading banks of Pakistan with a deposit base of aboutRs. 280 billion and total assets of around Rs.300 billion. Incorporated in1947, MCB soon earned the reputation of a solid and conservative financialinstitution managed by expatriate executives. In 1974, MCB wasnationalized along with all other private sector banks.

The Bank has a customer base of approximately 4 million and a nationwidedistribution network of 1,026 branches, including 8 Islamic banking

branches, and over 300 ATMs, in a market with a population of 60 million.

During the last fifteen years, the Bank has concentrated on growth throughimproving service quality, investment in technology and people, utilizing itsextensive branch network, developing a large and stable deposit base.


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OUROUR

VALUESVALUES

TRUST

We are the trustees of public funds and serve with integrity & commitment.Ethical behavior is of critical importance to us. We adopt full compliance withinternal and external policies and procedures, operating within the legalframework

CUSTOMER FOCUS

We continuously seek to exceed our customers expectations, forging andmaintaining long term relationships

INNOVATION

We strive to be the market leaders in innovative products and services offeringcustomized financial solutions with flawless execution

TEAMWORK

The diversity of our people is our strength. We inspire and challenge eachother working together to achieve synergy

ACHIEVEMENT

Our people are our most valuable asset. We are committed to a result orientedculture. Our goals are clear and merit is the only criterion for reward

SOCIAL RESPONSIBILITY

As responsible citizens we contribute to the social welfare of the community


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we live in

CORPORATECORPORATE PROFILEPROFILE

BBOARDOARDOFOF DDIRECTORSIRECTORS

The board of directors has the authority in guiding Bank affairs and in making

general policies. Some directors are the personnel of the MCB Bank and others

are successful businessperson and executives of other major organization. Ten

members are included in board of directors, see in a list.

Mian Mohammad Mansha

Chairman

Mr. S. M. Muneer Vice Chairman

Mr. Tariq Rafi Member

Mr. Shahzad Saleem Member

Mr. Sarmad Amin Member

Dr. Muhammad Yaqub Member

Mian Raza Mansha Member

Dato' Mohammed Hussein Member

Mr. Aftab Ahmad Khan Member

Mr. Abdul Farid Bin Alias Member

Mian Umer Mansha Member

Mr. Muhammad Ali Zeb Member

Mr. Atif Bajwa President / CEO

AUDIT COMMITTEE


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HUMAN RESOURCES COMMITTEE

Mian Mohammad Mansha Chairman

Dr. Muhammad Yaqub Member


Mr. Shahzad Saleemn Member

Mr. Atif Bajwa Member

RISK MANAGEMENT & PORTFOLIO REVIEW COMMITTEE

Mr. Shahzad Saleem ChairmanMr. Tariq Rafi Member Mr. Sarmad Amin Member Mian Raza Mansha Member

Mian Umer Mansha Member

COMMITTEEON PHYSICAL PLANNING, IT SYSTEM & CONTINGENCYARRANGEMENTS:Mr. Sarmad Amin Chairman

Mr. S. M. Muneer Member

Mr. Tariq Rafi Member


Mr. Abdul Farid Bin Alias Member

Mr. Atif Bajwa Member

BUSINESS STRATEGY & DEVELOPMENT COMMITTEEMian Mohammad Mansha Chairman

Mr. S. M. Muneer Member Mr. Shahzad Saleem Member


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Mian Raza Mansha Member Dr. Muhammad Yaqub Member

Dato' Mohammad Hussein Member Mian Umer Mansha Member Mr. Atif Bajwa Member

CHIEF FINANCIAL OFFICERMr. Ali Munir


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HIERARCHYHIERARCHY OFOF MCBMCB

PRESIDENT AND CEO

EXECUTIVE EXECUTIVE DIRECTOR DIRECTOR

INT SAMG INSPECTION OPERATION GSD DIV &

FRAUD

FORGERY

CONSUMER CORPORATE HRDBANKING BANKINGGROUP GROUP

(continued)


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CONSUMER CORPORATEBANKING BANKINGGROUP GROUP

GENERALMANAGER

REGIONALMANAGER

CHIEFMANAGER

MANAGER


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MCBMCBSS AAWARDSWARDS AANDND AACHIEVEMENTSCHIEVEMENTSBest Bank In Asia Award 2008MCB has been awarded as a Euromoney Award 2008 for the " Best Bank in Asia".

Best Bank In Pakistan Award 2006MCB has yet again received the esteemed Euromoney Award for the Best Bank in Pakistan. It is theonly bank to receive the Euromoney Award for Excellence for the sixth time in the past seven years.

Best Bank In Pakistan Award 2005MCB has again received the esteemed Euromoney Award for the Best bank in Pakistan. It is the only

bank to receive the Euromoney Award for Excellence for the fifth time in the last sixyears.

Best Bank In Pakistan Award 2004In a continuous winning streak, MCB once again takes pride in being conferred with Euromoney's

prestigious award of excellence, for being the "Best Bank in Pakistan" for the fourth time in the last fiveyears.

Best Bank In Pakistan Award 2003MCB believes in you. Together we work with quality, integrity and dedication, striving to achieve

collective success by understanding changing trends and assimilating into diverse cultures. Your trust inour ability and our commitment to deliver has again won us the Euromoney Award 2003 for the "BestBank in Pakistan".

Best Bank In Pakistan Award 2001Your trust and our commitment is always an award wining combination MCB was awarded as aEuromoney Award 2001 for the " Best Bank in Pakistan".

Best Domestic Bank Award 2000MCB was awarded as a Euromoney Award 2000 for the " Best Domestic Bank in Pakistan".

Asia Money AwardsThe Best Domestic Commercial Bank Award 2005MCB Continues to shine as once again Asia Money declares MCB as "The Best Domestic CommercialBank in Pakistan" for the year 2005.

The Best Domestic Commercial Bank Award 2004 MCB has a distinction of winning the Asia Money2004 award for being "The Best Domestic Commercial Bank in Pakistan".

MCB TOWER

A Vision of the Future

The modern, urbane architecture and intelligent design of MCB Towerreflect MCBs pioneering role in the banking arena, providing cuttingedge, innovative banking solution- leading with an edge of technology.

Setting Ever-Higher Standards

Towering at 116 meters, with 29 levels and 3 basements, MCB tower isthe tallest building in Pakistan. It is a sound representation of MCBsleadership position in the banking sector, testified by four best bank inPakistan Euro money Awards in five years.

Strong Foundation


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MCB tower is a manifestation of MCBs strong foundation with over 50years of banking excellence and represents our commitment to always staya step ahead.

Understanding At all levels

From individual customers to corporate and commercial clients, MCBsflexible solutions reach out to a diversified audience -reflected in all levelsof MCB tower


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Structure of MCB Ayub medical complex branchStructure of MCB Ayub medical complex branch

Abbottabad.Abbottabad.

G u a

M e s s e

C a s h

O f f i c e

A c c o u

A s s i s t

M a n a

B r a n c h M


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Overall performance Of MCB in 2010Overall performance Of MCB in 2010Net Profit

Profit after taxation in 2006 was Rs. 399.2 million, an increase of 67% from

Rs. 238.8 million in 1994. Since a complete provision for non-performingassets has been made, the balance of the bank now reflects its true strength.

For the first time after MCBs privatization in 1991, a dividend of 15% was

declared. It gives me great pleasure to state that for the year 2010 it has been

decided to announce an increased dividend of 24.39Rs.

Reserve Fund/EquityReserve Fund/Equity

A sum of Rs. 90.8 million has been transferred to Statutory Reserve this

year, raising the total Reserves to Rs. 1,796.6 million at the end of 2006,

from Rs. 2,416.8 million as last year.

DepositsDeposits

Deposits with the Bank at the end of year 2010 stood at Rs. 292,088

billion as compared to Rs. 292,088 billion in 2007.

AdvancesAdvances

Total Advances at the end of 2010 were Rs. 262,508

billion as compared to Rs 218,959

billion in 2007 showing a increase of 2.3%.

InvestmentsInvestmentsInvestments y declined by 0.9%. The current policy of the management is to dispose offInvestment in shares of listed and unlisted companies at the best possible prices.in 2010 it

is 97,790 Rs. Billion and in 2007 it was 115,358billion due to financial crunch inthe whole world.


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FOREIGN TRADE

The bank conducted Import business during the year amounting to Rs.

60.0 billion as compared to Rs. 56.4 billion in 2007.. Home remittances

increased to Rs. 16.7 billion from 30.6 billion. The increase in home

remittances business was due to better working polices, which has

effected the confidence of the Pakistanis working overseas.

RUPEE TRAVELLERS CHEQUES

Muslim Commercial Bank who are pioneers of Rupee Travellers Cheque

in Pakistan maintained their leadership position and sales recovered

during the year 2010 were Rs275 billion an increase of 57% over the

previous year.

HUMAN RESOURCES

To induct fresh blood in the bank and cater for future needs, a new batch

of management trainees was selected strictly on merit. After thorough

training these offices have been inducted in various divisions andbranches. Attention was paid to upgrade operational and managerial skills

of staff and a number of professional courses were conducted at MCB

Staff and Training Institutes during the year. We have continued our

programme of hiring of some senior level Banking Executives from the

market, wherever necessary.

Year 2010 ComplianceYear 2010 Compliance

The management and the staff of relevant divisions are fully aware about

the Millenium issues. All the core computer systems operating in MCB

are in full compliance. All the necessary steps had been taken and MCB

was very much aware about the Y2K bug.

FOREIGN OPERATIONS


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MCBS DEPARTMENTMCBS DEPARTMENT

GENERAL BANKINGIt is backbone of banking It is one of the major department of MCB. It consist offollowing departments:

1. Accounts Department

2. Current Department

3. Remittance Department

4. Clearing Department

5. Cash Department

ACCOUNTSACCOUNTS DDEPARTMENTEPARTMENTEvery transaction which takes place recorded in the computer so all transactions indifferent departments are forwarded to account department. Since all vouchersfrom different departments are forwarded to current department so this department

tallies all such transactions with current department after maintaining the ledger ofeach department. Following are different functions performed by this department:

Preparation of Financial Statements for different time span

Maintain all accounts of different departments

Calculation of profit on different schemes

Calculation of markup on different advances

Preparation Different types of reports for State Bank

Daily position of cash & every accounts

Matching daily summaries of all departments with ledger


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CURRENT DEPARTMENTCURRENT DEPARTMENT

This department maintains all formalities of the accounts and account holders like

it account name, account holders name, code number and full address. Differentcheques debit and credit voucher come form different departments like Token,Clearing, Remittances, Cash, Foreign Exchange, Advances and posted againstdifferent accounts.

A working Journal called Manual is prepared daily which shown the balanceaccounts of all parties. Mark-up and profit are calculated daily. That would bedebited at credited from or to account holders account after specific period oftime.

Markup is debit from the account after every three month profit is credited to

accounts after every six month. New accounts are also opened in thisdepartment. The fund deposited in the MCB bank can be classified under themain heads:

1) CURRENT ACCOUNT

2) SAVING ACCOUNT

3) TERM /CALL DEPOSITS

ACCOUNT OPENINGTo open an account the customer have to meet the general banking manager with

an introducer (the person who is going go introduce that person in the bank) andget an application form used for account opening. Different color-codedapplication forms are available for each type of account. Along with the form acard for specimen signature is also supplied to customer. Manager has everyright not to accept this contract if he is not satisfied by the details provided bythe customer. In case the contract is acceptable to both, now it is ready to openthe account formally.

PROCEDUREThe procedure begins with the punching of account opening form to thecustomer file i.e. customers master file. The manager records the necessary

details into this register and allots an a/c number from this a/c opening register.This register is maintained for each type of account and the a/c nos are allottedserially. After opening a saving and current account every applicants data isentered into the computer to maintain a safe record and application form is

properly filled so that it can be available when necessary.Checking officer is responsible to Tele the manual application form with thecomputerized a/c opening file. For fixed deposit only that application form isneeded which is prepared manually, because most of the procedure of fixeddeposit is done manually. The signature specimen card contains three signaturesof an applicant, applicant a/c no, a/c type, branch code, title of a/c, it will be

attached with an application form. Banker uses this card at the time when he


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receives the cherub; he compares customers signature with the signature on thecherub for avoiding fraud.

ACCOUNTS TYPESThough in theory there many types of accounts but commonly account operatorscan be classified in one of the following categories, each have different

documentation requirements: Single

Joint

Partnership

Private Limited

Public Limited

1) SINGLE

Only one person can operate this a/c. An individual who can fulfill therequirement of bank can open this a/c. We can call it a personnel or individuala/c. The requirements for this type are National Identity Card Photocopy,Minimum Deposited Balance, Account Opening Form, Letter of Kinship etc.

2) JOINT

In case of joint a/c applicant mentions that how much person will operate the a/c.Instruction are given for joint a/c such that the account shall be operated byanyone or more. The requirements for this type are National Identity CardPhotocopy, Minimum Deposited Balance, Account Opening Form, LetterKinship, Additional Signature Form (For Joint Account), Declaration regardingthe operator of account.

3) PARTNERSHIP

For partnership a/c, along with the application form other requirements needs

satisfied.

The requirements for this type are National Identity Card Photocopy, MinimumDeposited Balance, Account Opening Form, Registration certificate, agreementamong partners and Commencement of business and private registration,resolution of board of directors, commencement of business, memorandum andarticles of association and balance sheet etc.

4) PRIVATE LIMITED

Such type of account is opened in the name of the businesses having private limited

concern and mostly medium business enterprises open such kind of accounts. All theboard of directors have to submit the declaration regarding the account operator on the


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company pad and with the rubber stamp with the signature of the all the members ofthe board of directors. In case of any change in directors bank must be informedregarding that. In case funds are borrowed by the company all the directors approval isnecessary rather not only the authorized partner who can be the operator of the account.

5) PUBLIC LIMITED

Public Limited A/C type of account is opened in the name of the businesseshaving Public limited concern and mostly medium business enterprises opensuch kind of accounts. All the board of directors have to submit the declarationregarding the account operator on the company pad and with the rubber stampwith the signature of the all the members of the board of directors. In case ofany change in directors bank must be informed regarding that. In case funds are

borrowed by the company all the directors approval is necessary rather not onlythe authorized partner who can be the operator of the account.

ACCOUNT CLOSINGThere are no. of reasons of closing an account can be one of the following ifcustomer desire to close his account, in case of death of one account holder,

bankruptcy of the account holder and If an account contain nil balance or not upto the requirement of rules.Before closing any account, bank send letter to the account hold for informinghim that his account is going to be closed. There is need an approval formhigher authority to close any account.

1) CURRENT ACCOUNTSCurrent deposits are those which are payable to bank whenever demanded by thecustomer. Bank does not pay any profit on current deposits. There are ofdifferent scheme of saving deposits, which are classified under different duration

purpose and rate of interest. Fixed deposits are those deposits which are by thebank under the conditions that they will not be payable on demand but will bepayable under fixed or determinable future time date.

FEATURES

A sum of Rs. 500/= in cash as initial deposit is required for opening a currentaccount and the same may be maintained as minimum average running creditbalance. No profit will be paid on credit balances held in current accounts. Thebank reserves the right to allow opening of current a/c at its description. Alldeposits and withdrawal from a current a/c will take place only at the branchwhere the account is being maintained.Current a/c cannot be overdrawn, except by prior agreed agreements with the

bank. The correspondence relating to current A/Cs should be addressed tomanager of the branch where the account is being maintained. A distinctivenumber will be allotted to each current account and shall be quoted on allcorrespondence relating to the respective account and at the time of making

deposits and withdraws.


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The account holder can draw sums from his account by means of chequesupplied to him by the bank for that particular account. Account holder shouldtake well care of the chequebooks issued to them. The account holder will payexcise duty of Rs.4 per leaf to the government.

PAYIN SLIPThis slip is used for depositing the additional amount. The bank will accept thePakistanis notes. All cheques and other instruments should be crossed beforethey are deposited for credit into the account. There shall be no restriction onnumber of withdrawals in current account. The account holder is expected tomaintain a minimum running credit balance of Rs.500/.An account holder wishing to close his account must surrender the unused

cheques to the bank. The current account is computerized, thus it generate thestatement of account for all account holders periodically. Incidental charges are

beard by the account holder if its credit balance is less than Rs.500/. Service

charges of RS. 20/= will be taken by the bank, if an account is closed within 6months from the date of its opening.

FINANCIAL PRODUCTS2) SAVING ACCOUNT

Saving accounts are opened on proper introduction with sums of credit balancewithin certain limit for individual (single, joint) institutions, companies,educational institutions etc. MCB has introduced various schemes under savinga/c are following:

Mala Maal Scheme

PLS Account

Saving 365 Account

Capital growth certificate scheme

Fund Management Scheme

Khanm Bachat Scheme

Khushali Bachat Account

Term/ Fixed Deposits

MAAL-A-MAAL SCHEMEThis scheme is recently launched by the MCB after severe financial crisis of year1998 created as result of atomic bomb explosion, to mobilize the deposits. It isthe most profitable scheme of the bank and MCB has got Rs. 20 billion depositsthrough this scheme and the certificate is for Rs. 25000/-

PROCEDURE


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The procedure of Maal-a-Maal certificate is very simple. The applicant has to fillthe slip of certificate where he have to write Branch code, Applicants name, IDCard Number, Address, Phone #, Date and tenure etc. For different tenuredifferent profit percentages are declared as show below:

Tenure (Months) Rate of Return (%)

Two 06

Four 07

Eight 08

Twelve 10

These certificates are automatically renewable after maturity. Copy of ID card isattached with certificate. Profit is calculated at the time of drawing. At register,the officer writes reference or serial #, name of applicant, certificate #, date ofissue and date of maturity. At Maal-a-Maal certificate, the officer write date of

issue, maturity date, reference #, and name of the applicant.

PROFIT & LOSS SHARING (PLS) ACCOUNTPROFIT & LOSS SHARING (PLS) ACCOUNTThis account was started in 1980s after the issuing of banking ordinance in 1980

by Zia Government to develop Islamic banking in Pakistan. In this case customerwould be responsible for bearing profit as well as loss. The bank would bewithin its rights to make investment of credit balances in the PLS savingaccounts in any manner at its sole discretion and to make use of the fund to the

best of its judgment in the banking business under the PLS system. Forwithdrawal of larger amount, 7 days notice in writing is required to be given:

Minimum balance is Rs.500/=

Below minimum balance charges will be debited

Not more than eight withdrawals in a year allowed

More than Rs.15000/= are not allowed to draw

Seven day notice is required for withdrawal

Profit calculated on monthly basis

Profit paid on annually basis

Profit paid on lowest balance at the end

10% Withholding Tax on minimum balance

Zakat deducted on @ 2.5%


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SAVING 365 ACCOUNTSSAVING 365 ACCOUNTS

This account is newly developed of MCB and it provides flexibility of savingaccount to business people. Profit on deposits will be payable on daily product

basis on balance of RS. 500,000/- and above. However, if balance in the accountfalls below RS. 500,000/- on any day, the product will be ignored. There will beno restriction on withdrawal from the account. Zakat and withholding Tax isalso applicable on the account opened under this scheme. Minimum balance is Rs.500,000/=

Below minimum balance, profit calculation ignored

Profit calculated on daily basis

Profit paid on annually basis



CAPITAL GROWTH CERTIFICATE SCHEME Long term deposit

Profit rate as that of PLS Saving Account

Minimum amount of deposit is Rs. 10,000/=

Amount deposited double in of 5 years

No maximum limit of Deposits



FUND MANAGEMENT SCHEME Rate of return upto 15% per annum

Offered to corporate and business community

Development of secondary market for Government Securities


No maximum limit of deposits


KHUSHALI BACHAT ACCOUNT


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Saving type account

Rate of return is 8% per annum

Profit calculated on daily basis

Profit paid on half yearly basis

Utility bills can be debited through this a/c

No charges will be debited for utility payments

KHANUM BACHAT SCHEME Designed to support small savings of people

Depositing money for 10 years

No return until 10 year

Payments are made on monthly basis

No limit for monthly payments

After 10 year return will be on fixed rates

TERM DEPOSITSTerm deposits are fixation of certain amount of money for a specific span of

time. These can be of majorly two types i.e. short term notice deposits and longterm notice deposits. Different rates are charged for different period of times likeas shown by following table. If presented before maturity then previous periodrate would be charged.

Duration Rate Of Interest

01 month 08.1%

02 month 10.1%

03 month 11.0%

06 month 11.5%

01 year 12.5%

02 year 13.3%03 year 14.5%

05 year 16.4%

The instrument term deposit is like a slip containing issuing bank name, a/c # tooperate on computer, deal #, customer name, reference #, date of issue, amount,rate maturity date etc.

CALL DEPOSITSThese call deposits are presented in the bidding process as guarantee or securityfrom the bank that this much money is deposited in the bank. These are made in

the favor the party offering contract or any other person. The bank offer no


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interest rate on it because these can be called at any time. For encashment theapplicant must have to cancelled the call deposit instrument from its beneficiary.For collection the beneficiary usually send the authority letter for paying in the

shape of Demand Draft or pay order. The call deposit instrument containing theinformation regarding applicant and beneficiary name, joint name a/c opened,

signature cards for encashment, reference #, amount, date of issue, authorizedsignature etc.

OTHER PRODUCT / SERVICESThe privatization process for the expansion and diversification of economicactivities in the country also demanded the introduction of new banking

products. MCB took initiative in this direction and for the first time MCBdevised and marketed new products and services with brand names to enter thevarying requirements of its diverse customers. MCB currently have following

products or services in banking sector that are making it more prominent in the

banking sector: Night Banking

Fax Utility

Consultancy Services

Traveler Cheques

Self Supporting Scheme

Utility Bills Collection

Credit Cards

ATM

CONSULTANCY SERVICES

In the process of privatization of public sector units, prospective buyers needprofessional assistance and MCB, with its expertise offers to their specialized

service for valuation of the market value of the industrial unit, preparing biddocuments and arranging finance for the purchase of the unit.

SELF SUPPORTING SCHEME

Loan for poor/needy people

No mark-up charged

Maximum amount of Rs. 25,000/=

Minimum amount of loan Rs. 5,000/=

FAX utility

Pioneer to introduced Fax for customer service. Facilitates speedy transfer of funds.


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Within an hour any where in Pakistan.

Charges are debited to Customer account.

NIGHT BANKING SERVICES

To facilitate business community

Only in commercial trades centers premises

Clients can make deposits upto 8:00 pm

Date moved to next for all such transaction

UTILITY BILLS COLLECTION Utility bill collection for maximum customers

Objective is to create interaction with customers

Currently 1050 branches are performing this job

MCB RUPEE TRAVELERS CHEQUE Can be a safest way to carry cash

Cheque is accepted at trade centers & branches

No need to be a/c holder for traveler cheques

Cheque is signed once when issued.

Upon delivering second signed are made

In case of theft no fair to encash

But informing bank is necessary if thefted

ATM (Automated Teller Machine) Minimum balance of Rs. 500/=

No charges are debited per transaction

Only two hundred per annum debited

REMITANCESREMITANCES DDEPARTMENTEPARTMENTThe need of remittance is commonly felt in commercial life particularly and inevery day life general. A major function of any banking system is the transfer offunds from one client or one place to another. By providing this service to the

customer the bank earns a lot of income in the form of service charges. Thisdepartment deals with local currency remittance i.e. remittance from one city to


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another without actually carrying the currency. MCB uses following instrument fortransferring of money:

Demand Drafts (DD)

Pay Order (PO)

Telegraphic Transfer (TT)

Mail Transfer (MT)

DDEMANDEMAND DDRAFTSRAFTS (DD(DD))

DD is a written order given by the branch of the bank on behalf of the customerto other branch of the same bank to pay the certain amount to the customer. DDare issued for the particular place other than place of issuance. A drafts is a

Cheque drawn by a bank on its own branch or any other branch of another bankat a different place requesting it to pay on demand a specified amount of moneywhich is already received to the person named on it. DD is of following twotypes: DD payable

DD Paid Suspense a/c

In the first type as advice reaches for payment the immediately pay to thecustomer while in later as DD presented by the customer, it is paid and thesuspense account is debited.DOCUMENTATIONA printed application form is provided for filling in completely and signing bythe applicant. After depositing an amount of draft and commission of the bank,duly completed and signed by two authorized officers, then it is handed over theapplicant and credit order is dispatched to drawee branch. Following are the pre-requisites for the processing of DD: Bank Serial No

No. of DD

Central No

Test Key

Rs.60 Postage charges

0.02% With holding tax

PAY ORDERFor this kind of remittance the payer must have the account in the issuing bank.Pay order are more liquid as compared to cheques because cheques may be

dishonored while PO cant be. It is written order issued by the bank drawn andpayable on itself. It is used for local transfer of money from one person to


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another person. It is also used by the public for depositing money withGovernment or Semi Government department.DOCUMENTATIONThe party who requires a pay order will get a printed application from the bank.He will fill it and deposits the amount and commission. The bank charges are

same as on demand draft. Bank Serial No.

No. of PO

Central No.


TELEGRAPHIC TRANSFER (TT)In this case the authority is given from one bank to other on the behalf of thecustomer through telecommunication to debit their inter office account throughthem and credit their parties account mentioned in TT. It is an inter banktransaction. Telegraphic transfer is an instant transfer of funds. Through thismethod applicant can transfer money from one place to another place. There aretwo types of TT, Both types of TT are maintained in separate registers, test isapplied by the manager of every amount of TT. Incoming TT

Outgoing TT

Applicant has to fill a form along with depositing amount to be transferred andbank commission. MCB charges the commission at the same rate as in the caseof demand drafts.DOCUMENTATION Issuing Branch Name & Code

Beneficiary Branch Name & Code

No. of TT

60 Rs Postage and 140 Rs for Fax

Amount in words & Figure


Test key

MAIL TRANSFER(MT)As the name shows, it is transfer of money in the shape of document throughmail. Procedure is like TT. The transfer of funds from one place to another bymail is called Mail Transfer (MT). The MT can be foreign or domestic. The

applicant who is desiring to remit the funds by way of Mail Transfer can either


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deposit cash or ask the bank to debit his/her account with the cost of MTincluding the bank charges. These all measures are for safe transfer of funds.DOCUMENTATION Issuing Branch Name & Code

Beneficiary Branch Name & Code

Number of MT

Amount in words & Figure


Test key


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CCASHASH DDEPARTMENTEPARTMENTIn cash department both deposits and withdrawals go side by side. This department worksunder the accounts department and deals with cash deposits and payments. Thisdepartment maintains the following sheets, books, ledger of account:

Cash received voucher sheet.

Cash paid voucher sheet.

Paying-in-slip

Cheque Book

Cash balance book

Cash department is performing its job completely through computers. The

following staff members are performing their duties with patience and hardwork. Only two peoples are working in cash department named Mr. Ashraf OG-II and Mr. Arshad OG-III with one computer with them.

CCASHASH PPAIDAID SSHEETHEET

The only instrument that can be used to withdraw an amount from an account isthe Cheque book. No payments are made by another instrument. Cheques can beof two types, they may be presented at the counter and encashed and the othersare clearing or transfer cheques. Cashier manually inspect the Cheque for following:

Signature & date

Cross cutting

Drawees a/c title

Amounts in words & figures

Two signatures at the back

The cheques should not be stated as post dated. If in the Cheque there maydiscrepancy regarding any of the aspects described above the cheque is returnedto the customer for rectification. On other hand if the cheque is valid in allrespects, the cashier enters the necessary inputs in the computer and post theentry so that account balance is updated.When cashier posts these entries, computer automatically display the balance

before posting the transaction amount, balance after posting. The cashier easilyand quickly see whether the amount being withdrawn so exceed the balance orwithin the balance. If the amount does exceed the balance then it is upon thediscretion of the manager to allow an overdraft and not depending upon thecustomers reputation. If he does not allow an over draft, the procedure is

repeated again as described for the mismatch of the signature Cheque is return.


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The detail of notes (currency) is written on the back side of the Cheque. Thecashier at the same time maintain the Cash Voucher Received Record Sheet.Then once again inspect the signature of the customer cancellation mark ofchecking officer and stamp of POSTED is placed on cheque before hand overthe cash to customer.

CCASHASH RRECEIVEDECEIVED

For depositing the cash into customers accounts, there is need to fill in thepaying-in-slip giving the related details of the transaction. This paying-in-slipcontains the date, a/c/no, a/c title, particulars, amount being deposited and detailsof the cash. There are two portion of the paying-in-slip. The depositor signs theone part of the paying-in-slip one is retained by the bank to show an acceptanceof the entries made in the slip. The different colored paying-in-slip are used forall the types of deposits. Only the slips related to a particular type of a/c isacceptable by the bank.

For example current paying-in-slip for current a/c and saving paying-in-slips forsaving a/c etc. The paying-in-slip serves as a voucher to update to computerizedtransaction ledger. The transaction ledger is only updated by paying-in-slip andCheque. The cashier responsible to receive both the paying-in-slip and cash fromthe depositor. The cashier check the necessary details provided I the paying-in-slip and accounts the cash and tallies with the amount declared in the slip. If theamount does not tally with the cash given, the deposit is not entertained until thecustomer remove the discrepancy. On the other hand if the two amounts tally, thecashier fills in the Cash voucher received Record Sheet and assigns a voucherno. to both the transaction being made in the sheet and the slip.This voucher no. starts with one and continue by serial increments of one for

each day till the closing of the sheet, the cashier fills the voucher no, an account,cash day till the closing of the sheet. The cashier fills in the voucher no, anaccount of, cash entry in the related type of a/c and he post his initials on both

part of the voucher. Then the cashier send both to the accountant who verifies allthe entries in the two documents, if the entries in the two documents, if theentries in the two documents tally with one another, the accountant authenticatesthe two by singing on the two documents and posting stamps on the slip. One

part of the slip is then returned to the customer and other is given to thecomputer operator. A very important check is that the dates mentioned into thetwo documents must be the same.

The 2nd cashier posts the transaction entries in computer ledger. This ledgercontains the a/c no, a/c title, voucher no, voucher date, transaction code,transaction amount. After posting these entries, computer display before posting

balance and after posting. On every transaction computer generates an output oftransaction ledger. He assigns the stamp POSTED on the voucher to showvoucher transaction entries are posted. Checking officer receive this voucher andthe compute output transaction ledge, he manually inspects the entries of ledgerand voucher. If both are tallied, he then signs the ledger and put a mark ofcancellation on the voucher. After the verifications from the checking officer,cashier receives the voucher.


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CASH BOOK BALANCEAt the end of the working day cashier is responsible to maintain the cash balance book.The cash book contain the date, opening balance, detail of cash payment and receivedin figures, closing balance, denomination of government notes (Currency). It s checked

by manager. The consolidated figure of receipt and payment of cash is entered in the

cash book and the closing balance of cash is drawn from that i.e.Opening Balance Of Cash + Receipts - Payments = BalanceThe closing balance of today will be the opening balance of tomorrow. Thisdepartment is one of the most important department of the bank. All the booksmaintained in this department are checked by officer.


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AADVANCESDVANCES DDEPARTMENTEPARTMENTIt is another major department of the branch. Bank provides this facility to the

people who need advance money to meet their requirements. For getting theadvances, the first step is the preparation of credit proposal. Some principles oflending are considered whenever financing being is made. These principles are: Character

Capacity

Collateral

Capital

Condition

REQUIRED INFORMATION

An assessment of his business abilities

Accurate & up-to-date financial statements

Market reports about the borrower

Party dealing with other banks

Nature and structure of borrower business

Names of proprietors, partners or Directors

Detail of companies associated with borrower business

Financial condition of borrower business

PREPARATION OF CREDIT PROPOSALPREPARATION OF CREDIT PROPOSAL

At first, a formal application for credit approval is obtained from the party alongwith complete group position. The parties credibility report is also obtained fromthe banks from which the party has been doing the business. The party

creditability report is also taken from the head office of Trade informationDivision.For obtaining credit, party has to submit the last two years Balance Sheet andProfit & Loss Statementduly attested but authorized auditors. If the party alsoinvolve in export or import business then the bank also consider the data of threeyears about imports and exports.The Current and Debt equity ratio is also calculated by the bank.

Then recommendations are made the type of data required to prepare the creditproposal is to be gathered from different departments. Some data is obtainedfrom the foreign exchange department. Some data is obtained from current

account department and some data is available in Advance Department. Thepurpose for which the financing is required should be explained very clearly. The


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securities offered by the party to the bank is also evaluated. In case of pledgingof the property in shape of land or building the complete evaluation of the

property should also be attached.After all the requirements and necessary documents for applying for advances isfulfilled by the party then, the case is sent to the Chief Manager for approval. If

the manager find any discrepancies, he may write on these documents. If thecredit limit is in his range, he may approve the party for credit. If the amount isexceeding the Chief Manager send the case is forward to the Circle Office forapproval and here the same procedure is repeated and if the credit amount is inthe range of GM, he can approve and if the credit amount is very large fromCircle Office, the case is then sent to Head Office and if it is a real big then is to

be decided by Board of Director. MCB provides advances which are two types.These are two types of advances: Secured Advances

Unsecured Advances

In secured advances, the bank takes any security against the loans while in case ofunsecured advance no security is taken by the bank.

ADVANCES TYPESADVANCES TYPESMCB usually classified advances in to following types:

Agricultural Advances

Commercial Advances

Industrial Advances

COMMERCIAL ADVANCESCOMMERCIAL ADVANCES

MCB divided the advances in to two major types:

Fund Based

Non Fund Based

In the fond base advances, the funds of MCB is involved and in Non Fund based only guarantee isgiven by the bank.

Fund Base AdvanceMCB have following Fund base facilities of advance in its corporate branches. The

details of these types would be later. These are as follows:

Demand Finance (DF)

Cash Finance (CF)

Running Finance (RF)

Foreign bills purchased (FBP)

Local Manufacturing Machinery (LMM)

Payment against document (PAD)


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Finance against imported goods (FIM)

Finance against purchase collection (FACP)

Finance against foreign bills (FAFB)

Export Refinance Part I (Pre Shipment)

Export Refinance Part I (Post Shipment)

Export Refinance Part II

DEMAND FINANCE

This is a type of secured loan and demand loan never allowed without security. It is a

type of long term financing. MCB also gives loan under the head of demand finance toindividuals, industrial units commercial business etc.CASH FINANCE

In this, the borrower gives a specific reason for the need of cash. MCB gives the facilityof cash credit to business. The amount is passed through voucher and credit to the partyaccount. Normally 0.60 paisa per thousand is charged on daily basis to customer.

RUNNING FINANCEThese finances as evident by the name are given to the business to meet their dailyneeds. The mark up is charged on daily balances. This type of advances are given totrade, commerce and manufacturing for general purpose. Normally 0.60 paisa per

thousand is charged is charged on daily basis. It is drawn through Cheque.FINANCE AGAINST IMPORTED MERCHANDISEThis type of advances are granted against the pledge of imported merchandise. Thegoods imported are pledged by bank. Bank pays all the charges to exporter and customsand keeps the goods in its control. On payment from the client to bank, the bankreleases these goods.

EXPORT REFINANCE PART-I PRE-SHIPMENTThis type of loan is provided by the bank to the customer at the rate of 12% for the

period of 150 days. The bank provides this type of advance facility to those exporterswho have not enough money to make shipment. To promote the export, the government

pursue the Banks to provides loans to the exporters.

EXPORT REFINANCE PART-I POST SHIPMENTThis type of facility is provided to the customers who have enough amount of money tomake first shipment but not more. So the bank issues a loan to the exporter, thisfinancing is for period of 150 days. Finance is provided by the SBP to exporters for the

purchase of raw material and for its processing packing and shipment. The mark up ratecurrently set by the SBP is 12%. In case, if the party is unable to make the shipmentwithin 150 days of financing. The party has to pay certain amount of finance as asked

by the SBP and after 150 days the markup rate also charges up @ 60 paisa per thousandper day. So usually exporters tries to make the shipment within the fixed period set bythe SBP which is usually 150 days.EXPORT REFINANCE PART-IIIn this case the bank after receiving the performance of years in export business of the party the limit isset for a period of one year. Here the limit cannot be set by the terms pledged of the permission of the

bank.


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FINANCE AGAINST PURCHASE OF COLLECTION DOCUMENTThe bank provides this type of advance facility to those exporters who have not enough money to makeshipment. A bill(Cheque, draft, etc.) may be purchased by the bank. Bank pays the amount to the clientafter deducting its commission.FINANCE AGAINST FOREIGN BILLSThis facility is given to the exporter, If he needs an urgent money. Bank also provides finance against

the foreign bills. He gives bills of exchange to the bank as a security and bank send these bills forcollection and bank gives money to he exporter.FOREIGN BILL PURCHASEThe exporter which are under L/C are also provided with the facility of loan. Amount is given to theexporter after the approval of L/C by the issuing bank.LOCAL MANUFACTURING MACHINERYThe bank provides this facility to the business man who wants to buy the local manufacturedmachinery. LMM funds are provided by the SBP. Rate of markup for this type of loan facility is 12%on this type of loan.

Legal Mortgage/REGIRSTERED MORTGAGE Equitable Mortgage

Legal mortgage and equitable mortgage are accepted in case of immovable properties like land,building and machinery etc.

PledgeThis type of security is accepted in case of stocks or raw materials. In a pledge, the borrower has notright to sell the stocks with the permission of bank.


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CCLEARINGLEARING DDEPARTMENTEPARTMENTCheques

When we talk of cheques then there are two types of cheques

1) Open Cheque

Open cheque has following properties:

The word Bearer is not crossed.

Cross stamp is not there

Cheque is not of limited companies.

Self or name should be written on the cheque.Token

A token is given on open cheques when presented to bank for payment. In

this case payment is made at the spot to the cheque holder. First of all

cheque is presented to bank for payment. The name of holder, no of

cheque and amount is written on the register by the bank employee &

token is given to cheque holder. Then Cheque reaches the computer

department. There it is again feeded in computer & it is stamped after

checking the holder has enough amount in his account or not. After

feeding in computer ( debiting holders A/C ) , the cheque reaches the

cash department where the holder can receives his cash by giving token to

the cashier provided that he has enough amount in his A/C.

2) Crossed cheque

When the cheque does not fulfil the requirement of open cheque then it isknown as crossed cheque.

A) TRANSFER DELIVERY

When cheque has following properties then it is proceeded as Transfer

Delivery.

Cheque is crossed.


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Cheque is of MCB.

Cheque is from local branch.

In this situation cheques are collected separately as transfer Delivery.

Procedure

In Transfer Delivery following process is done.

First of all cheques are noted in Transfer Delivery Ledger with the date in

advance because it takes one day to reach cheque issuing branch in the

same city. In T.D Ledger Name of account holder, Number & amount of

Cheque are written and two copies , one original and one carbon copy of

voucher SF-73 B are prepared. Original copy of voucher along with

cheque is send to issuing branch while carbon copy and Pay-In-Slip is

with the bank.

The cheque with voucher goes to Main branch then to issuing branch and

then reverse from issuing branch to main branch and then to our branch.

B) CLEARING

In clearing the cheques which are

crossed

limited company

different bank in the same city

Procedure

Such cheques are collected as clearing cheques and are noted in Clearing

Ledger. Two copies of voucher SF-37 are prepared (See Annexe ) .

Original voucher with the cheques are send to Main branch which then

send to S.B.P in advance date. The payment is not given at hand but it is

transferred to account of account holder. In case if cheque is returned due

to number of reasons then the objection is finished and again send to


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main branch but this time a credit voucher along with original cheque is

send to main branch instead of any Pay-In-Slip.

Advance ClearingAdvance ClearingWhen cheque is sorted for clearing because of different branch in the

same city then we note these cheques in two days advance date because it

takes more time to reach that faraway branch . For example HBL of

Baha-ud-Din Zakariya University Multan.

Procedure of Payment of Cheque of Foreign CurrencyProcedure of Payment of Cheque of Foreign Currency

When cheques are denominated in foreign currency then procedure is not

like that of ordinary cheques of Rs. First of all cheques are issued and the

person give cheque to another person. When any party receives cheque in

foreign currency to deposit in his account then it gives it to the ban where

he has his bank account. The Bank sends this cheque to its Head Office.

Head Office send it to the country where transaction is done over that

currency. Then cheque goes to New York. From there it is send to that

issuing bank (domestic) from where party has received cheque whose

bank whose cheque it is. N.Y is credited and that bank is debited by that

amount. N.Y send it to head office of our Bank. Then H.O is credited and

N.Y is debited. Amount of Foreign currency is then send to main or local

branch where the party has its account. Now the account of that person is

credited and the H.O is debited

Now there may be two cases:

1) Either account is in Pak Rs.

2) Or account is in that country

3) Or account is in Foreign Currency other than the currency in cheque.


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C) Cheque CollectionC) Cheque Collection

When cheque is from another city then it is grouped as C.C.

ProcedureSF-37 form is used in Cheque collection (See Annexe ) Original

voucher with cheque is send to main branch. Carbon copy with Pay-In-

Slip is taken by bank for record purposes.

Pay-In-Slip

Here it is very necessary to have knowledge about Pay-In-Slip

Purpose

It is used for two purposes

Whenever we want to deposit cash in our account then pay-in-slip isused by writing amount on it and depositing it to cashier along withmoney.

Whenever we have cheque from any party to be collected in ouraccount we fill pay-in-slip . One part is attached with cheque andanother is given to cheque holder as a receipt.

Types

It is of two types depending upon the type of account.

Green Pay-In-Slip is used for Saving Account (See Annexe )

Blue Pay-In-Slip is used for Current Account (See Annexe )

STAMPS USED IN BANK(MCB)

Following stamps are used in for different purposes.

(1)Cross Stamp(1)Cross Stamp

This stamp is used to cross the cheque. Crossing can be done by 3 ways.

a) General Crossing

Sometimes the cheque is crossed by the drawing two lines on the upperleft corner of the cheque without writing any sentence on the cheque.


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b) Written Crossing

Cheque can also be crossed by stamping it with sentence Pays Account

Only

c) Special Crossing

Crossing can also be done by stamping a cheque with the words MCB

GBS Branch. This means that now cheque is in use of bank only. If it is

lost or dropped then it is of no use to anybody because now it is a cheque

of bank. This cheque will not be cashed any where else.

(2) Payees Account Will be Credited on Realisation(2) Payees Account Will be Credited on Realisation

This is used to stamp on the back of following instruments.

Cheque (simple). 2) Travellers Cheque. 3) Pay Order. 4) Speed Cash.

This means that the account of the payee will be credited provided that

cheque is accepted by Drawers bank otherwise not.

(3) Disbursement Guaranteed; Payees Account will be credited on(3) Disbursement Guaranteed; Payees Account will be credited onRealisationRealisation

It is used to stamp on the back of following instruments

1) Demand Draft . 2) Foreign Remittance

(4) Payees Account Credited(4) Payees Account Credited

This stamp is used on back of those cheques which are of the same

branch. It is of guarantee that if there is no problem with the cheque or

A/C then Payees account will be credited.


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(5) Clearing Stamp(5) Clearing Stamp

This stamp is placed in front of clearing voucher on the same day in

which clearing was made (one day advance date). Or the date in which it

is presented by Main branch in State Bank Of Pakistan.

((6) Round Stamp MCB6) Round Stamp MCB

It is used in two places.

When we are dealing with C.C then we write the number of C.Cwhich is written inside the stamp. One stamp is on cheque and otheron Pays-In-Slip.

When we fill Pay-In-Slip and give it to the bank officer along withcheque then he places this round stamp on the face of one part of Pay-In-Slip and marks his signature on it and give it to the customer as aevidence.

(7) Pay Cash(7) Pay Cash

This stamp is used when cheque is not crossed, it is open cheque. The

officer places this stamp on the front of cheque and writes token numberon it. This means that payment in cash will be made of this cheque on

presentation of token to cashier. This is like indication for cashier to pay

cash.

Reasons for Cheque returned unpaid in Cross ChequesReasons for Cheque returned unpaid in Cross Cheques

Following are the reasons for the cheque return.

Cheque incomplete

Clearing stamp Required.

Drawers sign incomplete

Drawers sign different from specimen

Post Dated

Payment stopped by drawer.


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Amount in words and figures differ.

Report of Lost or Stolen chequeReport of Lost or Stolen cheque

In case of lost or stolen incidents following procedure is performed.

Cheque no of lost cheque

Whether it was single or double signed.

Whether it was crossed or related to someone

Phone / Fax of reporter.

NIC no of reporter.

Signature of reporter.

How cheque was lost.

FIR Lodged or not.

Green SheetGreen Sheet

At the end of banking time ( 1:30 o clock), three Green sheets are

prepared for clearing , cash and account side. One Green Sheet is also

prepared by clearing department.

RTC DRTC DEPARTMENTEPARTMENT

This department deals in RTC. It stands for Rupees Travellers Cheques.

MCB RTC has the largest share of the total RTC Market. Over 1.5

Million satisfied customers have made MCB RTCs. These are printed in

the UK and carry a thread watermark- a feature that prevent

counterfeiting.

Important FeaturesImportant Features

As good as cashAs good as cash

The most convenient substitute for cash for all kinds of

transactions(property, trade, personal etc).


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DenominationsDenominations

Cheques are available in the denomination of Rs 1,000 Rs 10,000 Rs

50,000.

Easily EncashedEasily Encashed

They can be encashed at any MCB branch.

Easily refundableEasily refundable

In case of Loss Or Theft we can get the full amount back.

Exclusive Security FeaturesExclusive Security Features

MCB RTCs cant be duplicated. Various security features both in design

and materials make counterfeiting or fraudulent alteration extremely

difficult.

Valid Until UsedValid Until Used

Validity of Cheque is indefinite. We can use them for a week, a year or

more after the date of purchase.

Televerification SystemTeleverification System

It enables us to check the validity of cheque 24 hours a day .

Televerification UAN (021) 111-000-456.

ProcedureProcedureFirst of all RTC-10 is given to customer. It is filled and then cash is

deposited to cash department . One copy is for office and one copy is

given to the customer and RTC are issued at that time. When RTCs are

sold then H.O A/C is credited by using form no RTC-20.

It has five copies:

A,B,C,D,E.


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A= H.O copy, B= RTC Dept, C& D= Branch.

When RTCs are returned or purchased by the MCB then H.O is debited

by that amount by using form RTC-30. Summary of al RTC purchased by

branch is made on form RTC-40.


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ANALYSIS

SWOT ANALYSISSWOT ANALYSIS

STRENGTH

Strong Financial Position

As we can see in the financial statements of the bank, the financial position of theorganization is very sound and its profitability is in increasing. The Earning per share has

been increased on a rate of about 50%, which is a very positive sign.

Highly Qualified Employees

The bank has highly qualified and skilled workforce and it has succeeded to attract thebest banking professionals from across the country due to its growing pace and soundreputation.

Conducive Environment

The management of the bank is very much concerned with the development of andimprovement of the working environment. The bank has state of the art and purpose built

branches where all the modern technologies are provided to get the efficiency of theworkforce and the customer satisfaction.

Govt. Support and Encouragement

As the owners of the bank belong to UAE and the type of their investment in Pakistan isa foreign investment, the govt. is fully supporting the bank management due to its policyto maximize the foreign investment in the country, to get the economic prosperity.

Fastest Growing Financial Institution

Due to its successful business policies and the strong financial position the bank hasachieved the reputation of fastest growing financial institution in the country. It hasgreatly increased the customers confidence in the bank

Huge Expansion Plan

Due to its strong financial position the bank has undergone a huge expansion plan to

compete with the existing bank all over the country and with the passage of time thebranch network is expanding at a very good pace.

Young and Energetic Workforce

As the bank is a newer one in the country, the bank has an advantage over its competitorsbecause the majority of its workforce is young and not very much over aged. Thus thebank is getting maximum out put from its young and energetic workforce by spendingcomparatively less on their remunerations.


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Islamic Banking Division

The bank is one of the pioneers of the commercial banks who have started the IslamicBanking along with their conventional banking. The bank has a separate network of itsIslamic Banking Division which has 16 branches across the country and this network is

also expanding at a very good pace.

WEAKNESSES

WAIVEROFCHARGES

Currently the middle management of bank Al-Falah is the big reason for waiver ofcharges. Bank Al-Falah loosing a lot of its income likes (Cheque book charge, onlinecharges, statement charges, and other things) because of management. This is a weaknessof bank Al-Falah.

INEXPERIENCEDWORKFORCE

As the majority of the workforce consists of young professional, they lack in theirexperience. And sometimes lack of experience becomes a hurdle while serving to thecustomers. It is the point where they feel difficulty while competing the other bank,which have a very experienced workforce.

OVERWORK LOADON EMPLOYEES

It was observed in the branch that as compared to huge business the bank is dealing in,the no. of employees is lesser and thus there is an increased workload on the employees.

Due to this the efficiency of the employees is reduced.

EMPLOYEESARENOTVERYMUCH MOTIVATED

As discussed before, the workload is high and the employees, especially the creditdepartment, have to do late sittings to complete their tasks. On the other hand the bankhas revised its salary increments policy to decrease the increment rate, as a result adecreased motivation level of employees is observed.


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OPPORTUNITY:

Govt. is taking very bold steps to promote IT in Pakistan. ACBL has an opportunity to improve in technology.

Stock exchange is very volatile and takes immediate effect. So, in the time of crises, conservative investors return

to saving deposits.

MCB is surrounded by many competitors. It has an opportunity to do aggressive marketing to increase its

business.

As information technology is helping with different fields of business and banking so its the opportunity for us

to utilize the information technology to achieve our major goals.

Through promotional strategy we still have the opportunity to attract more customers.

THREATSUNCERTAINTYOF ECONOMY

Although the economy is growing at a good pace, but there are many factors whichresults in the uncertain position of the economy. Such as political uncertainty, WTO,increase in poverty etc. etc. As a result there are permanent threats of future risks andlosses for the bank.

HIGH RATEOF INFLATION

The inflation rate of the country has gone above the 10%. This can result into anunfavorable situation for the bank. And especially when the ownership of the bank isUAE based, the net spread for them can substantially decrease.

TRENDOF MERGERS

There is a trend of mergers among the banks to become prominent in the market and toget the maximum market share. This trend can result into the union of some leading

banks which can give tough time to the bank and it will become difficult for the bank tocompete with them.

RISKOF DEFAULTS

As discussed earlier that there is a trend of launching mega projects in the country. Andevery one is involved in this trend without taking any measure for the successfulness ofthese projects. This can result into the failure of this project which can make it difficultfor the banks to recover their funds from these defaulters.

RISKOFHUMAN RECOURSE


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Some other banks have competent taskforce, which is also a threat for MCB. Because human resource is the most

valuable resource.


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LLEARNINGEARNING AASS IINTERNEENTERNEE

Duties & AccomplishmentsDuties & Accomplishments

During my internship in MCB I worked in Remittances, clearing department andCustomer Service Office department and I successfully completed all the task/duties thatwere assigned to me.

The duties that I performed and the thing I learned each day are given as follows:

Learned basic operations of remittance department

Made vouchers and entries for Incoming TT

Observed other operations e.g. PO (Pay Order), DD (Demand Draft)

Learned bank charges for PO, DD

Learned how to make entries and vouchers for Outgoing TT(TelegraphicTransfer)

Made few Outgoing DD

Learned & MadeInter-Branch Credit Advices against the checks received fromouter city branches

Made Debit vouchers against the TT, PO & DD charges

MadeInter-Branch Credit Advices against the checks

Made entries in the Day Book

Learned PO and DD issuance in detail

Learned about clearing of cheques


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CONCLUSIONCONCLUSION

If I have to express my experience of internship in MCB Limited AMC Branch

Abbottabad I would briefly say:MCB is a good Organization in the way that anybody can join it for his/ her long-termcareer. Overall working environment is comfortable. Management of branch cares a lotof its employees and considers them as the Asset of bank. Behavior of senior executive of

bank is very polite and they are caring about the individuals ca

Documents

Intrnship Report Mcb