INTERNSHIP REPORT ON MCB BANK LIMITED

Internship Report submitted to the Faculty of Management & Administrative Sciences in Partial Fulfillment of the Requirements for the Degree of Masters of Business Administration.

BY Name of Student Role Number Program & Session Date of Submission MARYAM IRSHAD 08031020-055 MBA 2008-2010 9-Dec-2010

Name of Program Coordinator

_________________

Signature of Program Coordinator _________________

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Acknowledgement
First of all I would like to thanks to my ALMIGHTY ALLAH who always helped me in overcoming of all the difficulties which came across my way in completing my study career. Secondly I will be very thankful to my family, and the entire staff member at the branch who supported me morally, always guided me and helped me for making my success happen in this regard. Maryam Irshad

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Table of contents

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Executive summary This study contains the study of Railway Road Branch of MCB Bank Ltd of Pakistan. Internship is an essential part of MBA program. This report is a result of eight week performance in the form of internship at one of the branch of MCB Bank of Pakistan. Experience was full of knowledge regarding various facts of banking sector. It consists of practical experience, which I got during internship program. All the information in this report is based upon my observation and practical experience in different tasks during my internship at MCB. This report has been divided into various sections: First is introductory portion which relates to introduction of the Banking sector. In the next portion there is Organizational Structure, how many employees work in the organization and the main offices of the organization where those locating. In next step, I presented the Plan of my internship program, and then introduction of the branch is given where I did my internship and names of the departments in which I got training. At end, report shows training program in detail including detailed description of the operations/activities of the department(s) I worked in and also the detailed description of the tasks assigned to me and how I was performed them. In the last, the SWOT analysis, critical analysis, final Recommendations & Suggestions are given to overcome problems that are being faced by MCB Bank of Pakistan.

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Introduction Purpose Scope Objective

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1.1 Introduction As part of the academic requirement for completing the M.ba, the students are required to undergo for 2 months internship with an organization. The purpose of internship is to make the students familiar with banking knowledge and practice of that knowledge of banking discipline and administration. This report is about MCB. It was established in 1947 and since then it has become the large commercial bank through expanding its network nationally and internationally as well. It offers various kinds of products and services to its customers. 1.2 Purpose The main purpose of the study in hand is to observe, collect analyze and interpret the relevant information in a useful manner for making the internship report on MCB bank Ltd of Pakistan. It also serves for the purpose of:

Developing interpersonal communication skills and Working practically in an organization

1.3 Scope As an internee in MCB, I was mainly focused on general operations and dealings of banking in one of the branch of MCB. These operations include remittances, customer dealing, deposits, advances and foreign exchange. 1.4 Objective Being an internee in MCB my objectives were:

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Discuss thorough study of MCB To understand various operations and to equip with practical knowledge of the MCB of

Pakistan Products and services being offered by MCB

Organization
Brief history of the organization MCB Bank Ltd formerly known as Muslim Commercial Bank Limited was established by the Adamjee Group as a limited company under the Indian Companies Act, VII of 1913 on July 9, 1947.The bank was established with a view to provide banking facilities to the business sector of the South Asia. The bank was nationalized in 1974 during the government of Zulfikar Ali Bhutto and was privatized in 1991. This was the first bank to be privatized and the bank was purchased by an association of Pakistani corporate groups which was led by Nishat Group. By the month of June 2008, the Nishat Group owned a majority stake in the bank. The president of the bank is Mr. Atif Bajwa (previously with Citi Bank). Founded in 1948, Nishat Group is one of the leading and most diversified business groups in Pakistan. The group has strong presence in the most important business sectors of the country such as banking, textile, cement and insurance. Mian Mohammad Mansha is the Chairman of the group (and also MCB) and has played active role in its success. In recognition of Mr. Manshas contribution, the Government of Pakistan has conferred him with "Sitara-e-Imtiaz", which is one of the most important civil awards of the country. NATURE OF THE ORGANIZATION A unit of service industry of Pakistan, MCB is engaged in the borrowing, lending and advancing of money, the drawing, making, accepting, discounting, buying, selling, collecting FMAS

and dealing in bills of exchange, promissory notes, drafts, bills of lading, receipts, warrants, debentures, certificates etc. It is also engaged in the buying, selling of foreign exchange including foreign bank notes, the acquiring ,holding, issuing on commission , underwriting and dealing in stocks, funds, shares, debentures, the negotiating of loans and advances , the receiving of all kinds of bonds, valuables on deposit or for safe custody. The providing of safe deposit vaults the collecting, and transmitting of money and securities.

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Business Volume Reward Honors & Success stories

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Business volume: MCB is one of the leading banks in Pakistan with a deposit base of Rs 368 Billion and total assets of over Rs 500 Billion. The Bank has a customer base of approximately 4 million, a nationwide distribution network of over 1,100 branches and over 450 ATMs. Because of its strong financial performance, high quality assets, healthy capitalization, and the countrys lowest cost deposit franchise, MCB Bank Ltd is ranked as one of the best banks in the region. Rewards honor n successes: MCB Bank LTD has been awarded various awards at national and international level in recognition of its excellent performance. Some of the awards are as follows: 1. The Qatar Financial Centre award 2010: On Apr 19 the MCB Bank of Pakistan achieved The Qatar Financial Centre (QFC) Asian Banker Leadership Achievement Award 2010 for Pakistan at an impressive ceremony held in Singapore. President and CEO MCB Bank Atif Bajwa represented the bank in the ceremony and received the award. 2. The strongest bank award: MCB Bank was also the recipient of The Strongest Bank award for being Pakistans best-performing financial institution. The award of Strongest Bank was created as an addition to the Leadership Achievement programmed to recognize performance of the leader and the institution. The Asian Banker is pioneering this programme to help the investor and counter-party

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community in Europe and the US understand features of strong domestic franchises that perhaps are not fully appreciated on the global stage. 3. Euromoney Awards Best Bank In Asia Award 2008 MCB has been awarded as a Euro money Award 2008 for the Best Bank in Asia. Best Bank In Pakistan Award 2006 MCB has yet again received the esteemed Euro money Award for the Best Bank In Pakistan. It is the only bank to receive the Euro money Award for Excellence for the sixth time in the past seven years. Best Bank In Pakistan Award 2010 MCB has again received the esteemed Euro money Award for the Best Bank In Pakistan. it is the only bank to receive the Euro money Award for Excellence for the fifth time in the last six years. Best Bank in Pakistan Award 2004 In a continuous winning streak, MCB once again takes pride in being conferred with Euro money s prestigious award of excellence, for being the Best Bank In Pakistan for the fourth time in the last five years. Best Bank in Pakistan Award 2003 MCB has awarded as Euro money Award 2003 for the Best Bank in Pakistan. Best Bank in Pakistan Award 2001 MCB has awarded as Euro money Award 2003 for the Best Bank in Pakistan. Best Bank In Pakistan Award 2000 MCB has awarded as a Euro money Award 2003 for the Best Bank in Pakistan.

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4. Asia Money Awards The Best Domestic Commercial Bank award 2010 MCB continues to shine as once again Asia Money declares MCB as the Best Domestic Commercial Bank in Pakistan for the year 2010. The Best Domestic Commercial Bank award 2004 MCB has a distinction of winning the Asia money 2004 award for being The Best Domestic Commercial Bank in Pakistan.

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Product & Service line

Product/service lines Product and services of MCB includes:

1. personal banking i. deposit accounts a. khushali bachat account b. pak rupee saving account c. pak rupee current account d. pak rupee term deposit e. saving 365 f. Foreign pounds) Currency Savings Account(dollar, euro,

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g. Foreign Currency Current Account h. MCB Foreign Currency Term Deposit i. Dollar Khushali Account

ii.

Loan products a. b. c. d. MCB Business Sarmaya MCB Car4u MCB Pyara Ghar Easy Personal Loan

iii. iv.

MCB Master Card MCB Rupee Traveler's Cheques

2. corporate banking i. ii. iii. iv. Cash Management Services Working Capital Loans Term Loans Trade Finance Services

3. online services i. ii. iii. MCB ATM Services MCB Mobile Banking MCB Call Center

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iv. v. 4. virtual banking 5. Islamic banking i. ii. iii.

MCB Smart Card MCB Debit Card

Deposit Schemes Fund Based Facilities

These are given in more details as below:

1. Personal Banking i. Deposit Accounts A deposit account is any type of bank account, at a banking institution that allows money to be deposited and withdrawn by the account holder. It includes:

a. Khushali Bachat Account Khushali Bachat Account, a Rupee savings account is one of MCB Banks most popular products. Due to the low initial deposit, the account can be opened by people from all walks of life and still avail the facility of daily product profit calculation.

b. Pak Rupee Savings Account MCBs Pak Rupee Savings Account offers you attractive returns on your Pak Rupee investment.

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In addition, you have access to a countrywide ATM network convenient cash accessibility 24 hours a day. The facility also provides you with unlimited daily transactions with a limit on maximum withdrawal amount through the ATM machines.

c. Pak Rupee Current Account It offers the most convenience in terms of using an account. Because the account holder can make access to its funds without any prior notice whenever he wants and can make unlimited withdrawals. In addition, you have access to a countrywide ATM network convenient cash accessibility 24 hours a day. The facility also provides you with unlimited daily transactions with a limit on maximum withdrawal amount through the ATM machines.

d. Pak Rupee Term Deposit MCB Pak Rupee Term Deposit gives a higher rate of return. It gives you choice of 1 month, 3 months, 6 months, 1 year, 2 years, 3 years, 4 years and 5 year term deposits.

e. Saving 365 The MCB Saving 365 calculates profits on a daily product basis and gives you the facility of unlimited withdrawals.

f. Foreign Currency Savings Account MCBs Foreign Currency Savings Account offers you attractive returns on your Foreign Currency investment.

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You can invest in any of the three currencies i.e. US Dollar, UK Pound Sterling, or Euro

Your foreign currency account is exempted from Zakat and withholding tax

g. Foreign Currency Current Account MCBs Foreign Currency Current Account offers you the convenience of unlimited withdrawals i.e. access to your funds whenever you want without any notice. There is no limit on the number of transactions you make in a day.

h. MCB Foreign Currency Term Deposit MCB Foreign Currency Term Deposit gives a higher rate of return. It gives the choice of 1 month, 3 months, 6 months, 1 year, 2 years, 3 years, 4 years and 5 year term deposits.

i. Dollar Khushali Account The Dollar Khushali Account, a Dollar based account was introduced in 1993 at selected MCB Bank branches. Today, you can open a Dollar Khushali Account at over 200 branches in Pakistan.

ii. Loan Products Loan products of MCB include:

a. MCB Business Sarmaya MCB Business Sarmaya is the best Running Finance facility against your residential property which empowers you to manage your business dealings better. So act today and

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get MCB Business Sarmaya and thus improve your business, avail lucrative opportunities and expand your business, with absolute satisfaction of cash flows.

b. MCB Car4u Life is like a chess board. You plan your career options. You analyze your business moves. But when you really want to improve your life, you make a power move. MCB CAR4U Auto Finance is the power move that assists you in more ways than you ever imagined. It is affordable, with lowest mark up, flexible conditions, easy processing and above all, no hidden costs.

c. MCB Pyara Ghar Some destinations require a long wait. Like waiting for a home of your own. But with MCB Pyara Ghar it is now easy to step into your home and start living a real life. 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

d. 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.

iii. MCB Master Card

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Since the beginning of time, people have tried to find more convenient ways to pay, from gold to paper money and cheques. Today, money is moving away from distinct hard currencies and towards universal payment products that transcend national borders, time zones, and, with the Internet, even physical space. Plastic or "virtual" money, credit, debit, and electronic cash products, inevitably will replace cash and cheques as the money of the future.

iv. MCB Rupee Traveler's Cheques MCB Rupee Traveler's Cheques were first introduced in 1993 as safe cash for traveling and travel related purposes. The product has been extremely popular and is preferred over cash by customers while traveling and in all walks of life.

MCB Rupee Traveler's Cheques- The safest way to Carry Cash

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3.2. Corporate Banking

i. Cash Management Services MCBs network of over 900 branches in Pakistan enables it to collect and disburse payments efficiently with its cash management services. This also enables it to offer you a choice of paper based or electronic fund transfer solutions including collection amounts, cross branch on- line transactions etc.

ii.Working Capital Loans Based on the customers 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.

iii. 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.

iv. 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.

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3. Online Services

i. MCB ATM Services With a solid foundation of over 50 years in Pakistan, with more than 750 automated branches, 269 online branches, over 222 MCB ATMs in 41 cities nationwide and a network of over 12 banks on the MNET ATM switch, MCB is positioned at the forefront of the banking industry in Pakistan. This success has been possible because of a never-ending drive to achieve higher levels of excellence, constantly striving to raise the level of performance.

Card Categories MCB ATM Regular Card MCB ATM Gold Card

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MCB ATM Regular Card

MCB ATM Classic Card allows withdrawal of up to Rs.15,000 per day and a maximum of 3 withdrawals per day through one card.

MCB ATM Gold Card

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

ii. MCB Mobile Banking At the forefront of technological excellence, MCB proudly introduces MCB MOBILE BANKING & MCB SMS BANKING. The convenience of accessing your account balance information and mini statements whenever you want or wherever you may need them, with comfort and peace of mind.

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MCB Mobile What can be done with MCB Mobile banking is given below: Check your Account Balance Review your Mini Statement Transfer funds Purchase Mobile Top-ups Pay your Mobile Phone Bills Pay your Utility Bills Make your MCB Visa Credit Card Payments Make a Donation

MCB SMS BANKING MCB SMS Banking allows to avail the following services: Account Balance Inquiry. Account Mini Statement (last 5 transactions). View Credit Card(s) minimum payment. View Credit Card(s) outstanding balance. FMAS

View Credit Card(s) bill.

MCB Call Center Keeping up with banking services can be tedious but not with MCB Bank, where phone service is at your fingertips. Just dial our Call Centre from the comfort of your home or office or wherever you happen to be. It offers basic banking services for your convenience, eliminating the need for you to make unwanted trips to your branch including: General Inquires ATM locations Account opening procedures MCB Bank charges All MCB Product related information MCB merchant locations Financial Services Account Balance inquiry Funds transfer request Debit card Transactions details Last five transactions details All credit card related requests 24 Hour ATM card blocking Bill Payments (PTCL, SSGC, SNGPL, KESC, HESCO, IESCO, Mobilink, UFONE, Zong, TELENOR) Purchase Vouchers (Mobilink, Ufone, Zong, Warid, Telenor). Non Financial Services Credit Card Address Change request

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Virtual Banking activation 24 Hour complaint registration Mobile Banking activation

iv. MCB Smart Card MCB now brings you MCB SmartCard -a secure and convenient instrument of payment with unmatched functionalities. It provides 24-hour direct access to your bank account. The convenience and flexibility of MCB SmartCard will help you live a 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.

v. MCB 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.

3.4. Virtual Banking

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MCB Virtual Internet Banking offers you the convenience to manage and control your banking and finances when you want to, where you want to. MCBs Virtual Internet Banking facility is simple and secure. And its free of cost. With MCB Virtual Internet Banking you can access any of the banking services, 24 hours a day, 7 days a week and throughout the year. MCB Virtual Internet Banking offers a wide range of online services which makes your banking accessible anytime and from anywhere. 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 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. setup as beneficiaries, maintaining accounts with

Personal Alerts for reminding of pre-specified events and occasions.

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3.5. Islamic Banking

i. Deposit Schemes For customers who are looking for a deposit opportunity where they can pursue their funds and reap halal returns on it, we offer the following products:

Al-Makhraj Saving Account Al-Makhraj Ianat Account Al-Makhraj Term Deposit

ii. Fund Based Facilities

Ijarah Products MCBs 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. 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

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PEST analysis
5.2 Pest analysis

Political: Changes can occur in laws and policies because of political instability in Pakistan which can lead toward favorable or sometimes unfavorable results for banking sector. Economic: Economy of Pakistan is facing issues like inflation, employment, illiteracy which become hinders in business growth. Social: Cultural issues can be there to create some problem but still as there are a number of multinational companies are working therefore, these issues are not prominent. Technology: People are highly skilled and MCB can introduce new technologies to enhance the competencies.

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Role of organization
i. Contribution of organization toward economic development

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Organization structure
j. Organizational structure

Board Of Directors Mr. Atif Bajwa MR. S. M. Muneer Mr. Tariq Rafi Mr. Sarmad Amin Mian Raza Mansha Mr. Aftab Ahmad Khan Mian Umer Mansha Member Member Member Member Member President/CEO Vice Chairman Mr. Shahzad Saleem Dr. Muhammad Yaqoob Dato Muhammad Hussain Mr. Abdul Farid Bin Alias Mr. Muhammad Ali Zeb Member Member Member Member Member

Audit Committee Mr. Tariq Rafi Dr. Muhammad Yaqoob Mr. Aftab Ahmad Khan Mr. Malik Abdul Waheed Member Member Member Chairman Dato Muhammad Hussain Mr. Muhammad Ali Zeb Member Member

Human Resources Committee Mian Muhammad Mansha Chairman

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Dr. Muhammad Yaqoob Mr. Shahzad Saleem

Member Member

Mian Raza Mansha Mr. Atif Bajwa Chairman Mr. Sarmad Amin Mian Umer Mansha

Member Member

Risk Management & Portfolio Review Committee Mr. Shahzad Saleem Mr. Tariq Rafi Mian Raza Mansha Member Member

Member Member

Committee on Physical Planning, IT System & Contingency Arrangements Mr.Sarmad Amin Mr. S. M. Muneer Mian Raza Mansha Mr. Atif Bajwa Member Member Member Chairman Mr. Tariq Rafi Mr. Abdul Farid Bin Alias Member Member

Business Strategy & Development Committee Mian Muhammad Mansha Mr. S. M. Muneer Mian Raza Mansha Dato Muhammad Hussain Mr. Atif Bajwa Chief Financial Officer Mr. Salman Zafar Siddiqui Member Member Member Member Chairman Mr. Shahzad Saleem Dr. Muhammad Yaqoob Mian Umer Mansha Member Member Member

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i.

Number of employees

MCB Bank Limited Railway Road Branch, Gujrat (0260) has the following management Branch Manager Operational Manager Branch Supervisor Customer Service Officer Advances in charge Remittance in charge Cashier Cashier Cashier Tea Boy Mr. Adnan Mr. Ghareer Ms. Sidra Ms. Shakeela Mr. Tariq Ms. Aneela Mr. Aatif Mr. Farid Mr. Umer Bin Yaqoob Mr. Liaqat

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Main offices
ii. Main offices Principal office MCB 15 Main Gulberg, Lahore Registrars and share registration office M B 15 Main Gulberg, Lahore M M/s. THK Associates (Pvt.) Limited State Life Building No.3, Dr. Ziauddin Ahmed Road, Ka Karachi

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Departments

Departments of MCB As far as Bank MCB is concerned, it is one of the top in all-domestic commercial banks in Pakistan. The rapid increase in branch network shows the Banks performance within several years, which is worth considerable. However, this branch works with mostly all banking operations, which are normally performed by every commercial bank. It has basically following departments under which it operates all functions of bank carefully. These are mainly:

Account Opening Department

Account opening dept. is dept. is responsible for the opening and closing of accounts. After completing all the formalities which are necessary for opening an account, account is opened. These formalities are usually same for account opening but some times vary minorly for different type of accounts that customer wants to open or for different type of customers. The account holder is bound to follow all the instructions, rules or regulations in order to keep the account open. These conditions/rules are given on the account opening form. The first part establishes the preference regarding the type of account to be maintained. The various choices offered in this regard are: a. Current Account

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b. Saving/ PLS Account c. Basic Banking Account

a. Current Account The current account is the most common account and the most preferred amongst business concerns. There is no restriction on the amount of withdrawal. Current account enables the client to do cash transactions in a more efficient manner. b. Saving / PLS Account In Pakistan (PLS) saving account was introduced in January 1982. Individuals who wish to invest their money in order to get profit maintain this account. c. Basic Banking Account Basic Banking Account is opened is MCB. The minimum amount deposit in this account is very small as compared to other accounts and Bank can close the Account after six month if balance is zero. Brief procedure for opening an account:

Completion of The Form Introduction of customer Specimen Signature Card, Account Number Letter of thanks FMAS

Cheques Book Requisition Issuance Of Cheque book Entry Of Cheque book

Remittances Department

Meanings of Remittances Remittance means transfer of funds from place to place or from person to person. A Remittance is a vital service provided by banks to its customers as well as noncustomers. Since it is not a free service it is a source of income for the bank.

Parties involve in remittances Four parties involved in remittance:-

Remitter Remittee Issuing Bank Paying Bank FMAS

Remitter One who initiates, or requests for a remittance. The remitter comes to the issuing or originating branch, asks for a remittance to be made, and deposits the money to be remitted. The bank charges him a commission for this service. He may or may not be the branchs customer.

Remittee A Remittee is also called the beneficiary, or the payee. The person in whose name the remittance is made. A remittee is also the one who receive the payment.

Issuing Bank The bank that sends or affects the remittance, through demand drafts or online Transfers.

Paying Bank Paying Bank also knows as the drawee branch. The branch on which the instrument is drawn. It has to make the payment (usually located in a different city country).

Kind of remittances

Transfer within the branch Transfer from one branch to another Transfer from one bank to another bank in the same city FMAS

Transfers from one bank to another bank in two cities.

Instruments used in remittances: Demand Draft (DD) Pay Order (PO) Rupees Traveler Cheque (RTC) Cancellation of PO, DD & CDR

Clearing Department

Clearing department Meaning of clearing

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The word clearing has been derived from the word clear and is defined as: A system by which banks exchange cheques and other negotiable instruments drawn on each other within a specific area and thereby secure payment for their clients through the Clearing House at specified time in an efficient way. EXPLANATION: By clearing means sometimes the account holder of MCB Limited present a cheques, which is not drawn on MCB but the person, has an account in MCB Limited. In this case bank accepts this cheque in clearing department and later on collets the amount from bank on which cheques is drawn through clearing house. This function is called clearing. Clearing House It is a place where representatives of all banks sit together and interchange their claims against each other with the help of controlling staff of NIFT. It is one of the services provided by NIFT to other commercial banks. NIFT acts as a clearinghouse. Different banks are the members of the clearinghouse. A representative of each bank represents his bank in the clearinghouse. Each bank has collected cheques as behalf of their customer but these cheques are not drawn on their own bank so in the clearinghouse, they hand over these cheques to respective banks on which these cheques are drawn. Similarly each bank receives cheques from other banks if any.

Instrument to be presented Cheques Demand Drafts Pay Orders

Types of clearing FMAS

There are four types of clearing Inward Clearing Outward Clearing Intercity Clearing Same Day Clearing

Inward clearing: It includes all those cheques of our branch that were presented in other banks. Outward clearing: It includes all those cheques of other banks that were presented in our branch. Intercity clearing: It includes all those cheques of other banks that are outside of the city n dont lies under the area defined by NIFT for our branch. Same day clearing: Any cheque amounted to or above 200000 which was presented after the time once clearing instruments has already been dispatched, goes for clearance in the next morning and is cleared in the same day.

Accounts department
Accounts department

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This department is responsible to keep the record of each and every transaction and prepare reports about the amount of deposits and advances and sent to Head office or State Bank of Pakistan on monthly, quarterly and yearly basis. Activities The accounts department deals with various routine activities for the bank. The main activities performed by it are: a) Budgeting b) Reporting c) Maintenance & depreciation of fixed assets d) Miscellaneous functions

Budgeting Accounts department of a bank, for a year makes budget of every branch. Fiscal year of bank starts from January 01 and ends on December 31. The accounts department starts preparing budget from October for the next year.

Reporting The accounts department, in the form of reports, clubs the details of various departments together. Each and every minute detail is provided in weekly, monthly and annual reports. The reports are submitted to head office, SBP and to the government. The accounts department prepares many reports, of which the most common are:

Statement Of Affairs Income & Expenditure FMAS

Business Report SBP Report Outstand Receipt Report Currency Wise Deposits Report

Maintaining of Fixed Assets & their Depreciation Accounts department maintains the record of all the assets and charges depreciation on them. The bank normally uses the straight-line method to compute the depreciation. It is calculated on monthly basis and charged yearly. Bank not only depreciates the existing assets but also the assets transferred in and transferred out. Miscellaneous Functions The accounts department also performs some other miscellaneous functions like

Closing Entries Daily activity checking Report Generation Minor expense recording

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Cash Department
Cash department The cash department is the most important department of the bank. It receives cash from customers and then deposits it into the accounts of the customers and maintained their balances. The officers in this department are called teller and there were four tellers at the counter. This department involves in two activates: 1. Deposit cash in customers account 2. Make payments from customers account 1. Deposit Cash In Customers Account:When the customer wants to deposit amount in his account on opening of account or after that then he has to fill a deposit slip that shows the amount and the account in which the cash will be deposited. Then teller will receive amount and credit the customers account that shows increase in customers bank account 2. Make Payments From Customers Account:When the customer draws a cheque on the bank to pay a certain amount then teller will debit the customers account that shows reduction in his account balance. There are two main types of cheques which are :

Open Cheques

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Crossed Cheques

Credit department
Credit department

A good financial support when officials of this department invest money of depositors into feasible projects by lending loans to various business concerns. As the core activity of Commercial bank is to provide short-term finance, which is mostly for working capital requirements. As business concerns have money to complete the one production cycle, but it is not necessary that amount would be received just after sale, but credit sales are also made. So to finance next production cycle they obtain loans from commercial banks on short-term basis, for continuity in operations.

Credit card department

Types of Credit Card There are two Types of Credit Card.

MASTER VISA

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Further types of Visa Card

MCB visa card offering five types of cards:

Visa Gold

Visa Classic

Visa Classic Blue Women Exclusive

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Comments on the organizational structure The structure of MCB is very centralized, head office issues all the policies and then those has to be implemented within the bank as per given instructions, so it becomes sometimes a weak point as employee involvement is not there. There is a branch manager who looks after the overall working of the branch and who directs the working of the bank according to the instructions. Every person within each department is assigned various tasks which enhance their task performing ability and they are expert in their jobs but as there is no job rotation so there is no any opportunity of learning new skills for employees. Moreover, no department interferes in the working of other department which increases the efficiency of the department, as there is no external involvement by any person. The officers are well coordinated and assist each other in their work. There exists a friendly work environment. Everyone is not given promotion opportunity. Besides of these minor discrepancies Overall environment of MCB bank is very well established.

Part-II i. Organization taken by me:

Being an internee I worked in one of the branch of MCB situated on railway road Gujrat. I visited many banks several times but I find this bank always best from all aspects like they have very caring attitude towards their customers, they always welcome to their new comers so that is why I choose this branch of MCB. ii. Details of Supervisors:

All of the staff was so helpful to me, they always helped me in making things easy for me, but Ms. Shakeela, Ms. Aneela, Ms.Sidra, Sir. Ghareer, Sir. Adnan are who had been my supervisor during my span of internship and always guided me very kindly. May GOD bless all of them. FMAS

Weekly timetable
Duties & Accomplishments During my internship in MCB I worked in various departments and I successfully completed all the task/duties that were assigned to me. The duties that I performed and the thing I learned each day are given as follows: Week 1: Sep 3, 2010 Observe the operations performed by CSO Observe the operations performed by CSO Sep 7, 2010 Sep 8, 2010 Made Vouchers Made Vouchers Made Vouchers Week 2 Sep 13, 2010 Filling of cheques Made Vouchers Filling of cheques Made Vouchers Issued cheque books Made Vouchers Sep 9, 2010 Sep 10, 2010

Sep 14, 2010

Sep 15, 2010

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 Week 3

Filling of cheques Issued cheque books Received Cheque Book Issuance Requisition Made Vouchers Filling of cheques Issued cheque books Received Cheque Book Issuance Requisition Made Vouchers Filling of cheques

Sep 16, 2010

Sep 17, 2010

Sep 20, 2010 Issued atm cards Made vouchers

Sep 21, 2010 Made Vouchers Filling of cheques Sep 22, 2010 Balancing of atm cards Received cheque book requisition Issued cheque book Made online fund transfer vouchers Sep 23, 2010 Made Vouchers Issued atm cards Sep 24, 2010 FMAS

Made Vouchers Made online fund transfer vouchers Week 4 Sep 27, 2010 Recording of clearing on clearing register Learned how to check account balance Made vouchers Made Vouchers Recording of clearing on clearing register Checked account balance

Sep 28, 2010

Sep 29, 2010 Made Voucher Issued cheque book Recording of clearing on clearing register Sep 30, 2010 Recording of clearing on clearing register Issued atm cards Made vouchers Oct 1, 2010

Week 5 Oct 4, 2010 Made Vouchers Learned about stamps on clearing cheques Issued cheque book

Oct 5, 2010 FMAS

Attend phone calls Made clearing Made vouchers

Oct 6, 2010 Issued Credit Advices against DD Made clearing Checked account balance Issued ATM cards Learned drawing out bank statement Check account balance Made clearing Attended phone calls Made Vouchers Made clearing Record Intercity clearing Cheques

Oct 7, 2010

Oct 8, 2010

Week 6 Oct 11, 2010 Worked as CSO (Customer Service Officer) because CSO was on leave and performed the following activities: Attended phone calls Attended customer inquiries Issued ATM cards Issued Bank Statements

Oct 12, 2010 Made Vouchers Learned about account opening FMAS

 Issued cheque book Issued Credit Advices against DD Oct 13, 2010 Worked on the seat of A/C Opening/Cheque Collection/Lockers because the Madam on this seat was on leave, so learned and performed the following activities: Opened three accounts Issued cheque books Received Cheque Book Issuance Requisition Opened new accounts Issued cheque books Received Cheque Book Issuance Requisition Made CCs(Cheque Collection) Made Vouchers

Oct 14, 2010

Oct 15, 2010 Made clearing Week 7 Oct 18, 2010 Made debit and credit vouchers for SNGPL Worked as CSO(Customer Service Officer) Made Debit vouchers against the DD charges Opened new accounts Issued cheque books FMAS Opened new accounts Issued cheque books Received Cheque Book Issuance Requisition Made CCs Made Vouchers

Oct 19, 2010

 Oct 20, 2010

Received Cheque Book Issuance Requisition Made CCs Learned how to make DD

Opened new accounts Issued cheque books Received Cheque Book Issuance Requisition Made Vouchers Made scroll of wapda bills Opened new accounts Issued cheque books Received Cheque Book Issuance Requisition Made CCs(Cheque Collection) Made Electricity Bills Vouchers Issued bank statement Made clearing Opened new accounts Issued cheque books Received Cheque Book Issuance Requisition Made CCs(Cheque Collection) Made SUI GAS Bills Vouchers Made Electricity Bills Vouchers

Oct 21, 2010

Oct 22, 2010

Week 8 Oct 25, 2010 Made SUI GAS Bills Vouchers Made clearing

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Attend phone calls Open new account Made vouchers Made clearing Made CC Recorded returned cheques Made Electricity Bills Vouchers Balancing of atm cards Check account balance Made clearing Attend phone calls Made clearing Issued bank statement Issued cheque book

Oct 26, 2010

Oct 27, 2010

Oct 28, 2010

Oct 29, 2010 Recorded returned cheques Made vouchers Made clearing Issued atm cards Made SUI GAS Bills Vouchers Made clearing Issued cheque books

Oct 30, 2010

Oct 31, 2010

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Made Electricity Bills Vouchers Made clearing Issued atm cards Open new account

Working
Description of the departments and activities I worked in:

1. Account opening department 2. Remittances department 3. Clearing department 4. Accounts department

1. Account opening department:

Opening New Accounts During the span of mine internship in MCB I learned and observed a lot of about the opening of an account. Basically I think that the opening of an account is the establishment of a contractual relationship between the banker and the customer. By opening an account at a bank a person becomes a customer of a bank.

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There are several type of accounts that MCBs account opening department opens for its customers some of them are: Joint account Individual account Minor account Business account Partnership account Sole proprietorship account

Further I am going to express the basic requirements and steps involved in the opening of an account. Investigation Before opening an account MCB as like the other banks in Pakistan ascertain whether or not the person who is going to open the account is a desirable customer or not. Then MCB determine the prospective customers integrity, respectability, occupation and the nature of business by the introductory references given at the time of account opening. Negligence in this informal preliminary investigation may result in serious consequences not only for the banker concerned directly but also for other bankers and the general public who may be affected indirectly. In order to further strengthen and streamline this process, the Federal Ombudsman of Pakistan, vide his ruling on complaint no. II/31/5186, has directed the banks to retain with the account opening form a Photostat copy each of the National Identity Cards of the person desiring to open an account as well as that of the introducer. As per these directions, the concerned Branch Managers are required to obtain the original National Identity Cards along with their Photostat copies and then return the original after attesting the authenticity of the retained copy. How to Open an Account Before opening an account in MCB I observed that the following points must be considered in this regard. 1. Another account holder of the bank should properly introduce the new customer.

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2. The account holder should sign the account opening form in the presence of bank officer and the signature is duly verified. 3. A copy of identity Card is required by Bank. 4. Against submission of the Banks prescribed application form, duly introduced in the manner provided and on supplying such document, as may be required and account may be opened. The Bank reserves to itself the right to refuse to open an account without assigning any reason. 5. Each account shall be allotted a distinct number that is to be quoted in all correspondence with the bank relation to the account. 6. Minimum amount to open an account is required regarding the nature of account. Procedure to Open an Account According to my practice in MCB, when a customer wants to open an account, the bank officer gives him an application form. All information, which is necessary to be known by the bank, are requirements of the application form. Form also requires the essential documents to be attached by the customer. Basically following information is required to open an account with MCB 1. Title of Account 2. Full Name of Applicant 3. Occupation 4. Address 5. Telephone No. 6. Currency of account 7. Nature of Business 8. Introducers Name, Address & Signatures 9. Special instruction regarding the account

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10. Initial Amount of the Deposit 11. Signature of the applicant

Issuance of Cheque Book During my period of internship in MCB I observed that when a account is opened then a cheque book is issued to the customer for drawing his money at per rules. Following procedure is adopting for the issuance of cheque book. When a customer opens an account with the bank, he is provided with cheque book for withdrawals from account. However, the first cheque book is given to the customer only when all the required documents are checked. A cheque book contains ten, twenty five, fifty or hundred leaves. The cheque book also carries a requisition slip for the issuance of the new cheque book. This slip is duly filled and signed by the customer. The signature of the customer is verified by the bank and new cheque book is issued to the customer and serial numbers of the cheques are duly entered in the book of the bank. Along with the signature, person should also write his full name & address. Usually only one cheque book is issued at a time, however big concerns who need a number of cheque books at a time, may ask the bank to stock as number of cheque books in their name and to point their name on these cheque books. Bank debits the clients account for excise duty of Rs.6/- per cheque and keeps the cheque book ready for the customer, as on his advice. The officer keeps and maintains the cheque book register, Cheque book inventory and cheque books issued are recorded in this register. The account number for which the cheque book is issued and the number of leaves are also recorded in this register when the cheque book issued an entry is passed in the cheque book issue register. Working under Customer Service Officer During my internship I have worked under CSO (customer service officer) Ms. Shakeela and performed different tasks that were assigned to me. These task are give below: FMAS

Full fill the deposit slips on behalf of customer. Fulfill the online slip for the customer to online the money from one account to

another account either in the same branch are another branch. Checking the account balance of the customers. Online verification of the customer CNIC from the NADRA for the purpose of

account opening. Fulfill the KYC form that is attached with the account opening form. Entry of new account opened in account opening register. Issuance of the credit card for the customer.

Cancelation of the ATM cards which are issued and not received by the customer more than 90 days. Honour of a Cheque During my internship training in the Muslim Commercial Bank Limited, I observed and found Cheques are received for the following purposes. 1. For Cash payments 2. For transfer(from one account to another account) 3. For Clearing 1. For Cash Payments Cheques, which are presented on Bank counter, must be checked in the following way: 1. Date. 2. Signature of Drawer.

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3. Signature of Payee. 4. Whether Payee account duly is there. 5. Match the figure and wordily amount of cheque. When all above matters are satisfied then cheque: 1. Cheque number. 2. Amount of cheque. 3. Particulars. 2. Cheque for Transfer When cheques are presented to be sent for collection and drawn on bank situated within the city then there are three stamps to be put on face as well as on back of cheque. 1. Crossing Stamp (face). 2. Transfer Stamp (face). 3. Bank Manager Stamp (back). 3. Cheques for Clearing There are two stamps put on each cheque, sent for clearing: 1. Crossing Stamp. 2. Manager Stamp. Cheques in Collection When cheques received in clearing are intra city then these are controlled under CC. First of all, these cheques are recorded in day book then allotted number and then serial number. Then a Performa is prepared in which Bank on whom was drawn, cheque number, amount, beneficiary name are recorded. After completing that Performa Cheque is posted along with Performa.

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Clearing department
Clearing Process i. Stamps Put On the Cheques When the cheques are presented in MCB to be deposited in their respective payees accounts, different stamps are put on cheques before their lodgment in outward clearing. ii. Crossing the cheques Crossing means two parallel lines, drawn across the face of the cheques with or without words written in between them. Crossing may be general or special. In clearing, cheques are crossed specially. Cheques are stamped with banks name between two parallel lines to constitute special crossing. After the cheques have been crossed specially, the holder cannot receive payment except through the banker named on the cheques crossing saves the instrument to go it in illegal hands. If, crossed cheques is lost or stolen, there is no risk involved. So it is an effective means of minimizing the risk of loss. iii. Clearing Stamp After the cheques have been crossed specially, clearing stamp is put on the cheques and other instruments, with the next date, so these cheques would have to be presented in their concerned drawee banks on the subsequent day.

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iv. Endorsement Stamp The word endorsement means anything written or printed on the back of an instrument. So endorsement stamp has to put with words Payees account Credited will be credited. v. Recording in clearing register After putting these three stamps on cheques & other negotiable instruments, those are recorded in clearing register. Following information is entered in clearing register. 1. Name of favoring party. 2. Name of bank on whom drawn. 3. Branch. 4. Cheque number. 5. Amount.

v. National Institutional Facilitation Authority:After completing all the formalities cheques are sent to NIFT taking them on calculator, their total amount along with total number of instruments. A summary is prepared and sealed after noting the number of seal. NIFT after segregating the cheques of different banks delivers them to their concerned banks. vi. Send Report To The Bank:After delivering the cheques to different banks NIFT send report to MCB, then the banks staff tally the amount of that report for its own record. vii. Delivered Cheques to Respective Banks:Next morning, these cheques are delivered to the respective banks between 9:00 to 9:30AM. In the same manner, other banks present their clearing drawn on MCB. Total

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number of cheques and their amount delivered to other banks and received from them are written on the Clearing House schedule branch for their payment. After proper scrutiny of cheques, verification of signatures and confirmation of balance in the account, the Officer Clearing Department Debit the customer Account. If any cheque is not passed due to insufficient balance or any other reason, Officer Cash Department returns the same cheque by attaching a cheque return memo containing reason for return. viii. Credit the Customer Account:If the cheques are clear then the MCB credit the customer Account. If the bank receives the outward return due to any reason then this cheque is entered into the cheque returned register and bank charges are deducted according to the schedule of charges.

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CLEARING Process

INWARD CLEARING

OUTWARD CLEARING

Instrument Collection Source

From Account Holder

Fill Transfer Slip & Receipt Hand over To Client

Stamping
Cross Stamp Cleaning Stamp Payee,s Account Will be Realized

Enter in NIFT Register Separately Signed By Officer

Separate Transfer Slip & Cheque

NIFT Card

Hand Over NIFT Agent

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Balancing of ATM cards In this it is checked that which are the cards for which letter has not been received which contains pin code for that card. Summary of learning Skills and qualifications: The first thing that I learned from my working experience is the confidence that I felt in myself which gradually developed as I got interact with various kind of people every day and because of which I could increase my communication skill , which is the most important ingredient in grooming up your personality. The second thing is that I got the experience or it can be said that I got the first glimpse of the practical life that is ahead of me now. Before going to job I use to take my life so easy but on going there I realized how it was tough taking responsibilities toward obligations.

Internship influence on future career plans: Internship can influence my future plans as I go somewhere to work I already will have an idea how the work place can be. All organization have their own values, atmosphere or environment, so if I will be already having any experience it would be easy for me to adjust accordingly. When I was working as an internee in the bank they did not treat me as an ordinary employee when I made any mistake as they use to do, rather their behaviour to me was so polite because they knew it I was there for a short time only, this way I got the idea how to deal in work place as new boss will never give me any space for mistake.

Correlation between internship activities and classroom knowledge:

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As for as I am concerned I dont think so that both class room and internship activities are correlated. Application of bookish knowledge could not be seen thoroughly, moreover in class room there is always a teacher for your help and there can be a chance of error but its all vice versa in case of any working organization, though I had a supervisor but he/she was there because I was a learner so in this way these can be correlated.

SWOT Analysis
Strengths: Brand image because of "Muslim" word in the name in an Islamic country Experienced people, advanced management and facilities gave MCB an

edge over its competitors. Customers first preference due to reasonable service charges and

speedy service. Proven Management A team of highly cooperative and professional individuals ready to serve. First Pakistani privatized bank with quality. Adequate financial resources. Modern style of banking through fully computerized control and twenty

four hour banking. Faster banking services especially in operations and foreign exchange. Suitable location Innovative products and services. Online facility A great reputation in the banking market.

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Loan under proper security It has network of branches spread in all over the country Main strength is goodwill and loyal staff Adequate use of technology of computer. Efficient management

Weaknesses: Internal political issues Work over load on staff. Political instability in country Too much centralized operation. High management expenses. Lack of employees in the bank. People not aware of its products. All the customers are not equally treated. Lack of specialized skills. Lack of time management is another weak point , the staff is normally on

their seats till7:00pm or 8:00. Opportunities To go global Rapidly growing economy. Govt. incentives for banking sectors.

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New bank technologies (SWIFT, ATM) credit card etc. Avail new promotional activities. Computer technology improvement. Potential in market. Qualified individuals, banking professionals available to be taken use of if

required. Opportunity in consumer financing. Decentralization of operation. Covering the entire world Due to Privatization people switch to banks to satisfy their needs of lending and

borrowing. Threats Increasing competition in banking sector of Pakistan Customer awareness about other banking substitute available in the market. Customer exploitation of excessive competition among bank. Other banks timing, cooperativeness, facilities attract the customers. Some time rules violation against relationship occurred, customers are preferred Still great potentials in the Pakistan banking sector. Flexible environment provides many opportunities for the growth.

as compared to the rules and regulations. Change in the government policies can affected the banking sector. Political instability is a great threat in Pakistan. FMAS

Severe competition in the banking field. Decreasing purchasing power of the consumer. Inflation factor is also a big threat.

Critical analysis of branch The branch is well placed with other branches of other banks and has a very good customer base. The branch is located in a busy area of the city and is well known. The branch still has things to work on like effective communication with the customers and with the other branches as well. The branch is still not fully computerized and much of the work is done manually and effective marketing strategies can improve its performance significantly. Conclusion of the report: Overall the experience was very good. The staff of branch has got very high morale they are committed to their work and very hardworking. They helped me in every way they could do in making my learning easy and effective. They have got very friendly environment that made me feel never like a stranger there. Further the physical facilities are quite good. The rooms are fully air conditioned and properly furnished. But in spite of all these things there were some weakness that I observed there, if they succeed to overcome those problems than surely it can be the best branch among all others.

Recommendations MCB is important bank of Pakistan. During my internship program in MCB, I found the pure professional banking atmosphere. Working with a team of professionals was a unique experience and I learned a lot while working. There are some suggestions that management should apply to improve the efficiency of the bank. 1. As compared to other banks, MCB has few branches in the country and there is

no branch outside the country. Because bank is performing profit able functions so it is

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the times requirement to establish the new branches outside the country as well as within the country. Sick unit and branches should be given attention and qualified and experienced officers should be appointed there. 2. I observed that most of employees are working on one seat, although they are

expert in their own job but they are quite unaware about the others job. So it is suggested that there should be rotation of jobs and in this regard training should be provided to the employees so that they may produce the better results and enjoy the real spirit of banking. 3. In spite of fact that deposits are growing day to day and bank is earning a

reasonable amount. But expenditures are not within the control of the management that caused the wastage of resources. So management should take the proper actions to reduce the management expenses. 4. Because some other banks are offering high rates of interest and also providing

the personal loans to the customers so there is room for the MCB to introduce the innovative products providing the rates more than their competitors and by Providing the personal loans to the customer to compete in the market and to attract the more customers. 5. Bank is performing a lot of advertising activities to increase its deposits, but no

attention toward its Advances. Management should also take a keen interest in promotional activities for Advances and other products as well. 6. In bank there is no Human Resource department that plays an important role in

the recruitment and training of the employees to improve their performance. So there is need to have a Human Resource Department in the bank. 7. There is need to introduce the new technology and equipments according to the

requirements. The influence of Pakistan Army officers should minimize.

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REFERENCES AND RESOURCES Oral: Mr. Adnan, Branch Manager Ms. Aneela, Remittances Officer Mr. Ghareer Ahmad Operation Manager Ms. Shakeela, CSO Written: Annual Report Records Internet www.acca-pakistan.com MCB website www.mcb.com www.scribd.com www.wikipedia.com

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Appendix

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Rules for writing the internship report:

Do not leave your report to the last minute. This will mean you have to rush and will increase the chances of you making mistakes. Start the report as early as possible! You will write 13,000 words ( 5%) report. Part-I should not exceed from 4500 words & part-II must contain 6000 words in which summary of learning must contain at least 1000 words and remaining is up to you. You have to submit soft and hard copy of your internship report on the due date without any delay. No excuse will be accepted. Font & Spacing: Your report should be printed in Arial 12pt, 1.5 line spacing and bound. Header/footer: Header must contain the name of internship organization while footer must contain the name of student at most left side along with his/her role number and name of department at most right side as FMAS. Correction: Make corrections with the greatest care. It is important that you check your spelling and grammar. Do not just rely on the Microsoft spell and grammar checkers. You must proof read your work. Margin: Every page of the internship report must be kept within margins set as follows: A minimum margin of 1-1/2 inches (for binding purposes) on the left side of the page; 1 inch at the right side; 1-1/4 inches at the top and bottom of the page. Any page submitted with less than the minimum margins will be rejected. How to number sections:

Each main section 1, 2, 3, etc First level of sub section 1.1, 1.2 Second level of subsection 1.1.1, 1.1.2 You can include graphs, pictures, data, drawings, or design calculations in your report; however they should not cover more than 1/3 of the page. Larger graphs, pictures, data, drawings, or design calculations should be given as an Appendix.

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