waqar sharif report

Internship Report on MCB bank

Internship Report

On

MCB Bank Limited

D.C Chowk, Bahawalpur

SUBMITTED TO: Mr. Salman Azhar

SUBMITTED BY: Waqar Sharif

BBA-M1 (2012-2016)

DATED: Sep 16, 2015

ISLAMIA UNIVERSITY OF BAHAWALPUR


President’s Message:

We at MCB Bank Limited believe that every employee is unique and possesses distinctive talents that we value and nurture. MCB Bank is home to an exclusive group of committed and dedicated individuals who jointly, with their dedication, honesty, innovation and teamwork, contribute towards our collective success. Our organization has a long and healthy tradition of providing exceptional service and preserving strong relationships with both our internal and external customers. Therefore, at MCB Bank, we inspire every individual to play a significant role in our continued success by creating maximum economic value for our clients and shareholders, while maintaining the highest human values and principles.

MCB Bank is one of the leading financial services providers in Pakistan and as one of the largest and oldest banking entities in the country; we not only embrace and cherish our heritage and traditions, we strive for growth and change as well. Our goal is to create and promote long term relationships with our customers by catering to all their financial needs, including traditional banking services, insurance and investment advisory, coupled with an exceptional level of customer service.

Our objective at MCB Bank is to ensure that we have motivated, professional and customer-centric employees on board who help us deliver the promise of being the 'most credible bank' across the industry.

Imran Maqbool

President & CEO MCB Limited Pakistan


EXECUTIVE SUMMARY

I have done my internship in MCB Bank limited (Muslim Commercial Bank

Limited). The main purpose of internship was to learn, by working in practical

environment and to apply the knowledge acquired during the studies. There was

only one department named as general banking. I had worked in Remittance,

where I filled Pay Order, Online transfer, Demand Draft, Call Deposit Receipt

forms. I did all type of clearing named as Normal Clearing, Same Day Clearing,

and Intercity Clearing. I have opened new account for new customer. I

successfully completed the entire tasks that were assigned to me.

During the six week time period of my internship I learned about different things

that how the Branch Manager deals with the customers and Staff. I learned that

what kinds of documents are required for different kinds of financing activities or

opening new account etc. Those things which I have mentioned above have

been discussed in detail and all the procedures have been describe thoroughly.

In this report there detail back ground, vision and mission statement and

business operation (organization Structure, SWOT Analysis, Marketing Strategy,

Competitive Strategy, Business Process Analysis) and some relative material of

MCB Bank Limited.

I have done my best I hope to ALLAH that this report will provide a complete and

clear image of Muslim Commercial Bank Limited.


Acknowledgement

First of all I thanks to ALLAH that

HE gave me courage and ability

to do this kind of task.

Secondly, I see that the credit

goes to my loving parents and

my respected teachers who

make me able to be at this

position.

Finally I’m thankful to all the staff

members of MCB limited Bank

(D.C Chowk BWP) Specially the

Branch Manager; Mr. Adnan

Azam and Operation Manager;

Miss Yasmeen.


TABLE OF CONTANT

Executive Summery 02

Dedication 03

Acknowledgement 04

Vision and Mission 07

Background 08

Awards 09

Values 10

Business Operation

Organizational Structure 12

Board of Directors 13

Products & Services 14

SWOT Analysis

i. Internal Analysis 17

ii. External Analysis 19

Marketing Strategy 20

Competitive strategy 23

Business Process Analysis

a. Horizontal analysis of Balance Sheet 28

b. Horizontal analysis of Income Statement 29

c. Horizontal analysis of Balance Sheet 30

d. Horizontal analysis of Income Statement 31

Plan of internship program 35

Account opening department 36

i. Current account 36

ii. Saving Account 37

iii. Term deposit account 37

Clearing department 40

i. Outward clearing 41


ii. Inward clearing 43

TABLE OF CONTANT

Remittances department 44

i. Demand Draft (DD) 45

ii. Pay order ( PO) 45

iii. Online transfer 45

iv. Call Deposit Receipt (CDR) 46

v. Deposit slip 46

References 48


VISION & MISION STATEMENT

Vision Statement

“To be the leading financial services providing, partnering with our customers for

a more prosperous and secure future.”

Mission Statement

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

financial solutions to create and nature long term relationships with our

customers. In doing so, we ensure that our share holders can invest with

confidence in us.”


BACKGROUND OF MCB BANK

The MCB was established one month before the independence in June

1947. First head quarter in Calcutta and after independence it was shifted from

Calcutta to Dhaka and afterward its head quarter were shifted from Dhaka to

Karachi in 1948. Among the other 22 scheduled banks with 3525 branches

network nationalize on 01st January1974 through the nationalization of Bank act

1974, under the nationalization policy of the Government. MCB was also

nationalized and at that time of nationalization Premier Bank was merged in MCB

Bank Limited in 1974.

After the failure of the communism it was realizes through the world the idea

of nationalization was not correct and has no any positive effects on economy.

This idea developed especially in 1980 decade under which in sub continent of

Asia its importance was also realized. In Pakistan privatization and deregulation

policy was stared in1998 under this policy the first unit privatized was MCB with a

view to stable the economy and reduce the burden of national exchequer of other

sick units.

In 1990 this bank was announced for privatization on the ground that 51%

shares would be for general public out of which 26% shares would be offered to

particular party, which will take the administration of bank and lead by Mian

Muhammad Mansha who was the first chairman of MCB LTD.


VALUES

Integrity

We are the trustees of public funds and serve our community with

integrity. We believe in being the best at always doing the right thing. We

deliver on our responsibilities and commitments to our customers as well

as our colleagues.

Innovation

We encourage and reward people who challenge the status quo and think

beyond the boundaries of the conventional. Our teams work together for

the smooth and efficient implementation of ideas and initiatives.

Excellence

We take personal responsibility for our role as leaders in pursuit of

excellence. We are a performance driven, result oriented organization

where merit is the only criterion for reward.

Customer Centricity

Our customers are at the heart of everything we do. We thrive on the

challenge of understanding their needs and aspirations, both realized and

unrealized. We make every effort to exceed customer expectations

through superior services and solutions.

Respect


We respect our customers’ values, beliefs, culture and history. We value

the equality of gender and diversity of experience and education that our

employees bring with them. We create an environment where each

individual is enabled to succeed.


Products & Services Provided by MCB bank

MCB RETAIL BANKING

DEPOSIT ACCOUNTS

Current Account

Savings Account

MCB ONLINE SERVICES

MCB ATMs

MCB Call Centre

MCB Mobile

MCB Mobile ATM

MCB Online Banking

MCB LOAN PRODUCTS

MCB Car4U

Student Personal Loan

Home Loan

Personal Loan

Cash4Cash

MCB CARDS

Credit Cards (Classic/Gold Credit Card) (Platinum Credit Card)

Prepaid Debit Card


MCB LITE

MCB Lite (pass it on) is a “socially connected” payments solution

that saves you time and money.

This innovation enables you to control your finances and make

payments through the use of a Visa card and a Mobile Wallet.

MCB INVESTMENT BANKING

Project & Structured Finance

Syndicated Loans and Debt Capital Markets

Quasi Equity/Hybrid Instruments

Equity Capital Raising

Advisory Services

Facility Administration

Commercial Banking

MCB CORPORATE FINANCING

Working Capital Loans

Term Loans

Trade Finance Services

Cash Management

Transaction Banking Division

MCB BANCASSURANCE

MCB’S REMITTANCE

MCB AGRICULTURE PRODUCTS

Shadabi Plan


Khushali Scheme

Tractor Finance Scheme

Aabiari Scheme

Grower Finance

Dairy & Meat Plan

Murghbani Scheme

Baghbani

Mahigeri Schemz

PRIVILEGE BANKING

OTHER SERVICES

MCB MNET

MCB Salary Club

MCB Lockers

MCB SMS Banking

MCB Full Day Banking

SWOT Analysis

There are two part of SWOT Analysis

Internal Analysis

External Analysis


Internal Analysis

Strengths:

The strengths of MCB Bank are the following:

1. MCB is the first Pakistani privatized bank because of its quality

management, marketing, innovation in product and services is

performing well in financial market.

2. It has created a good reputation in the banking sector.

3. It has 1200+ branches on different places in Pakistan.

4. It has one of the nation’s largest ATM network with more than 500

ATMs covering 110 cities across the country and it is still growing.

5. It provides MCB mobile ATM for convenient world class banking

services.

Weaknesses:

1. Mismanagement of time is the biggest mistake in MCB branches that

the official time of bank closing is 5:30pm but the staff is normally on

their seats till 7:00pm to 9:00pm.

2. Due to the lack of advertisement majority of the people are not well

aware about the products of MCB.

3. There is lack of specialized skill because of rotation policy of human

resource management.

4. Most of the staff and employees are dissatisfied due to low salaries as

compared to same position in other banks.

5. It is also seen that the staff complain about over loaded of work. It is

the reason that turnover ratio of MCB is increasing.

6. MCB has numbers of employees of the period when the MCB was

nationalized bank they cannot perform their duty as like employees in


other banks. They always show rude attitude that is not much

motivating for new customer.

7. There is lack of skills and training of employees. MCB have to gave

attention to improve the skills and abilities of the employees according

to modern banking requirements.

External Analysis

Opportunities:

1. MCB bank can capture big portion of the market by expanding their

branches and ATM network to other countries.

2. MCB have to launch some new product or services like tele bank and

internet banking etc.

3. Media is powerful tool of communication.MCB have to use it for

advertisement of new product and severs provided by MCB bank. By

adverting MCB can create more new customers.

4. MCB bank has to start some kind of Social services or for culture

benefit. By doing this it can motivate its customer that you are

contributing in this services by parching and using MCB services.

5. Now the concept of Islamic banking is increasing in Pakistan. There is

opportunities that by creating Islamic branches all over the country and

fallow Islamic structure in those branches. It should also creat Islamic

product for customers

Threats:

1. In Pakistan the banking sector is growing rapidly and it has attracts the

business men to enter in banking sector. Some foreign banks have


started their business in Pakistan. Now MCB bank has to compete with

great effort by giving superior services.

2. From few years Pakistan is facing a lot of problems like energy crisis,

rising prices of product. Govt. of Pakistan is borrowing money from

State Bank of Pakistan and from commercial banks also and due to

lack of money to give to depositor many banks can cause to bankrupt.

3. Foreign banks are increasing in Pakistan

4. Foreign banks are providing attractive and new services to MCB

customer.

5. Hacking is now a days a new threat for MCB.

Marketing Strategy

MCB bank is using different kind of marketing Strategies to expand their

business. MCB bank is using marketing mix strategy for promotion. It is a set

of marketing tools which is used to find out the marketing objectives in the

target market.

These tools are classified into four factors named as

1. Product:

MCB bank has started new services and product to satisfy the

customers. Different kind of accounts are offered by the MCB bank to

attract the customers.

Mahana Khushali Plan :

It is a five year plan in which amount is deposited for five years

and return is given on monthly basis. By this play MCB bank is


targeting those people who want to save their money and want some

return on their investment.

Capital Growth Certificate plan:

This plan is offered to target those person that deposit their

amount for long period of time. According to this plan your deposited

amount will be double after five year.

Night - Banking Services:

MCB has started these services on busy commercial centre for

the ease of their customer. Now traders and other client can deposit

their amount in these services centres till 8:00Pm.

There are many other products and services that the MCB bank had

lunched. By providing such kind of products MCB has attracted the

consumers from outside the bank market and core account from

competitors.

2. Price:

It is a critical marketing tool. It represent that what customer have to

pay against services received. It is the only element that creates revenue

for MCB bank. Some time pricing strategy is also used to set the price. In

the start prices were low but after creating the image MCB bank has

raised their charges. There come some objectives in setting the price

some of objectives are Maximization of profit, obtaining market share,

rate of return on investment etc.

3. Place

Place is used in since of distribution channel ,and distribution mean

that from where the seller makes his products available to the

buyers.MCb bank is using to important channels of distribution.


Bank Branches

Bank Credit Card

Bank branches:

Bank branches are the most important channel of distribution for the

bank. Through these branches MCB is easily serving potential customers.

The largest portion of business is being generated from these branches.

The bank has also started Saturday banking in all big cities with ATN

network.

Bank Credit Cards:

MCB has made the contract with Master Card International and

made the ac cess of the card possible at 11 million outlets all over the

world. Due to use of this card there is rapidly increase in the usage of

banking services.

4. Promotion

MCB bank use this tool for different activities. BY using different

ways MCB is targeting the customers to use their product or services.

MCB Ltd has used this tool to spread information about their services and

product.

MCB bank is using four basic promotional tools for promotion and those

promotion tools are the following.

Advertising

Personal selling

Publicity

Sales promotion


Competitive Strategy

After making the mix structure of basic elements of marketing the banks

focus on growth strategies.

Growth strategy is further divided in to four strategies:

Market Penetration Strategy

Market Development Strategy

Product Development Strategy

Diversification Strategy

1. Market Penetration Strategy

With the help of this strategy the bank management first consider

either it could gain more market share or not with its current products in

their current markets.

2. Market Development Strategy:

In this it considers whether it can find or develop new markets for its

current products.

3. Product Development Strategy:

Then, it considers whether it can develop new products of impending

interest to its current markets.

Diversification Strategy:

Finally it will review opportunities to develop new products for new

markets.


These strategies have been examined further as follows:

Market penetration:

By using this strategy MCB bank is increasing its sale with existing

product in the existing market by means of increased and more effective

positioning and targeting, delivery and promotional activities.

Some basic strategies are:

Selling present services to new customers

Selling more services to present customers

Market development:

MCB is using this strategy to increase sale in new markets with

existing products and services.

Product development

This strategy is used to introduce the new product or services in the

existing market.

Diversification

It is also growth strategy and it is most difficult growth strategy for

bank. In this strategy the bank focuses on to grow new services and new

markets.

Business process Analysis


Business process Analysis

HORIZONTAL ANALYSIS OF BALANCE SHEET

2014 2013 2012 2011 2010

100% 100% 100% 100% 100%

Assets

Cash Due from Banks 100 90.51 90.06 91.32 89.35

Other Assets Total 100 84.88 61.02 51.86 53.86

Net Loans 100 91.23 90.19 78.35 64.32

Land and

Improvements

100 99.54 99.16 98.59 98.3

Building and

Improvement 100

93.45 91.35 68.91 81.29

Furniture and

Equipment

100 85.46 71.56 62.46 53.17

Gross Fixed Assets 100 97.43 88.86 83.67 93.57

Accumulated

Depreciation (100)

(87.25) (68.96) (56.36) (62.77)

Net Fixed Assets 100 100.24 94.79 92.95 99.59

Intangibles 100 23.67 37.07 25.65 29.85

Goodwill (Cost in

Excess)

100 100 0.00 0.00 0.00

Other Non Current

Assets

100 87.22 38.44 40.18 0.00

Total Assets 100 83.99 82.35 77.09 66.29

Liabilities

Accounts Payable 0.00 345.92 185.35 0.00 17.49

Accrued Expenses 100 88.66 82.53 75.06 65.19

Long Term Debt 100 123.07 67.96 29.24 36.38

Total Debt 100 74.96 168.94 152.48 45.23

Def. Income Tax Lib. 0.00 0.00 0.00 0.00 509.0


Stockholders’ Equity

Common Stock Equity 100 79.99 62.82 53.33 48.48

Retained Earnings 100 95.09 87.79 75.89 65.92

Equity Gains or Losses 100 111.31 109.03 94.52 208.4

Equity Adjustments 100 110.01 110.34 94.26 56.85

Total Equity 100 96.68 89.58 77.12 87.07

Total Liabilities and

Stock Equity

100 89.99 82.0 71.09 66.29

HORIZONTAL ANALYSIS OF INCOME STATEMENT

2014 2013 2010 2009 2008

100% 100% 100% 100% 100%

Interest Income Bank 100 92.67 81.64 63.91 53.13

Total Interest Expense 100 93.10 81.31 48.22 35.09

Net Interest Income 100 92.24 81.98 79.02 71.68

Loan Loss Provision 100 106.96 126.31 117.65 50.47

Net Interest Income 100 88.59 70.02 69.45 76.93

After Loan Loss

Provision

Non-Operating

Expenses

Non Interest Income

Bank

100 91.88 96.73 84.45 70.57

Minority Interest

Liabilities 100

100.52 22.39 22.74 22.14

Other Liabilities Total 100 75.02 72.21 76.49 63.19

Total Liabilities 100 89.10 80.98 70.29 4.59


Non Interest Expense

Bank

(100) (85.94) (75.56) (62.62) (46.3)

Pre Tax Income 100 94.28 85.00 89.02 108.9

Income Taxes 100 81.88 48.76 89.98 107.6

Non-Recurring Events

Total Net Income 100 100.55 102.19 88.53 109.4

Net Income Available

For Common stock

100 100.55 102.19 88.53 109.4

VERTICAL ANALYSIS OF BALANCE SHEET

2011

100%

2010

100%

2009

100%

2008

100%

2007

100%

Assets

Cash Due from Banks 13.86 14.10 15.37 17.83 17.42

Other Assets Total 30.96 30.58 23.94 22.16 26.07

Net Loans 45.68 46.12 50.24 50.36 44.56

Land and Improvements 1.47 1.63 1.77 2.03 2.69

Building and Improvements 0.004 0.0048 0.049 0.0053 0.0054

Furniture and Equipment 0.008 0.0083 0.0075 0.0074 0.0067

Gross Fixed Assets 2.77 2.96 3.01 3.31 3.9

Accumulated Depreciation (0.006) (0.0055) (0.0051) (0.0048) (0.0057)

Net Fixed Assets 2.16 2.41 2.5 2.83 3.33

Intangibles 0.00006 0.000018 0.000031 0.000025 0.000031

Goodwill (Cost in Excess) 0.0004 0.000054 0.00 0.00 0.00

Other Non Current Assets 0.0069 0.0066 0.0032 0.0039 0.00

Total Assets 100 100 100 100 100

Liabilities

Accounts Payable 0.00 0.0003 0.00019 0.00 0.00002

Accrued Expenses 0.0097 0.0096 0.0098 1.03 0.0096


Long Term Debt 0.00008 0.00012 0.00004 0.00003 0.00004

Total Debt 2.31 1.93 4.77 4.96 1.58

Def. Income Tax Lib. 0.00 0.00 0.00 0.00 0.0066

Minority Interest Liabilities 0.0004 0.00047 0.00012 0.00014 0.00014

Other Liabilities Total 2.45 2.04 2.16 2.57 2.33

Total Liabilities 88.27 87.39 87.17 87.27 84.59

Stockholders’ Equity

Common Stock Equity 1.46 1.29 1.13 1.09 1.06

Retained Earnings 7.72 8.16 8.26 8.2 7.68

Equity Unrealized 1.95 2.42 2.62 2.6 6.15

Equity Adjustments 0.0059 0.0072 0.0079 0.0078 0.0050

Total Equity 11.73 12.6 12.82 12.72 15.4

Total Liabilities and Stock

Equity

100 100 100 100 100

VERTICAL ANALYSIS OF INCOME STATEMENT

2014 100%

2013 100%

2012 100%

2011 100%

2010 100%

Interest Income Bank 540.26 498.94 431.61 389.97 262.16

Total Interest Expense (273.92) (253.63) (217.93) (152.27) (87.79)

Net Interest Income 266.32 244.32 213.67 237.7 174.36

Loan Loss Provision (52.83) (56.20) (65.30) (70.21) (24.35)

Net Interest Income 213.50 188.12 148.37 167.49 150.01

after Loan Loss Provision

Non-Operating Expenses

Non Interest Income

Bank

111.53 101.92 105.57 106.39 71.89

Non Interest Exp. Bank (177.58) (151.77) (131.30) (125.62) (75.19)


Pre Tax Income 147.45 138.25 122.64 148.26 146.70

Income Taxes (47.46) (38.65) (22.65) (48.24) (46.64)

Minority Interest 0.000001

5

0.0039 0.000098 (0.00019

)

(0.00061)

Non-Recurring Events

Total Net Income 100 100 100 100 100

Net Income Available

For Common Stock

Holder

100 100 100 100 100

Details plan of my internship program

Introduction of branch:

I have done my six weeks internship from MCB bank limited (1657)

D.C office Bahawalpur under the branch manager Mr. Adnan Azam. This is a

online branch of MCB bank and this branch is doing good business. The question

comes is how? Reasons behind this are firstly, when the branch manager joins

this branch he brings some account with him. Secondly, this branch is on exact

location on the main road and different are around it. Thirdly, the Staff of this

branch is much cooperated they work like a time that’s why the working of

management is very smooth and efficient. Finally, this branch have very good

contact and the relation with the shops business entities and the other sound

parties as well to increase the deposit of the branch and maintain the efficiency

of the work and enhance the organization.

The branch manager Adnan Azam introduced me with staff members and

guided me about different functions being operated within the organization.


Starting and the ending dates of my internship

Starting and the ending dates of my internship program in the MCB bank limited

(1657) D.C office Bahawalpur.

Starting Date: August 24, 2014

Ending Date: October 06, 2014

Names of the departments where I have worked during my internship

duration

1. Account opening department

2. Clearing department

3. DHA Reconciliation

1. Account Opening Department

I have worked one week in account opening department. It is the most

important department of any branch of any bank because all the working of the

bank is based on the account. It is the first step between the customer and

banks. I opened new accounts some for new customers and some for old

customers because they want to operate more than one account.

There are different types of accounts in MCB bank limited which are offered to its

customers. Different accounts has different benefits different charges different

minimum balance requirement and different purposes.

There are three types of account.

1. Current account

2. Saving account


Current Account:

MCB Bank offers a variety of current accounts to provide to the

everyday transactional needs of various customers. These accounts ensure ease

and freedom to bank from any of the 1100+ branches across the country.

The different accounts include:

i. Normal Current Account that has 10,000 rupees minimum balance

requirement.

ii. Business Account that has 50,000 rupees minimum balance

requirement. It is offering free online transactions, Demand Drafts, Pay

Orders and lots more to meet the day to day business requirements

iii. Current Life Account which offers the security of life insurance free of

cost and for all others, the conventional Current Account.

Note: If the balance goes down from the minimum balance required then the

bank will be charged Rs.50 as per mint.

Saving Account:

MCB Bank offers a wide array of savings products that suit short term

growth & transactional needs. Our savings accounts offer attractive profit rates

as well as flexibility to transact.

i. PLS Saving Account has no minimum balance requirement and it offer

profit rate on semi annually balance.

ii. Xtra Saving Account is targeted for customers having Rs. 5 million +

deposit and it offer profit rate on quarterly balance.

iii. 365 Gold Account offers profit rate on daily balance


In addition, two unique products: Smart Savings and Savings Maximizer are

special saving accounts run solely via debit cards and other remote banking

channels, offering a very competitive rate to both high and low end savers.

Term Deposit Account:

MCB Term Deposit offer attractive short to mid-term investment options

with flexibility, convenience and security. With various tenor options available,

customers can choose one that suits their needs. This is combined with different

profit payout options and the added facility of being able to avail credit facility

against their deposits.

To open term deposit account the minimum balance requirement is one lack

rupees. Term deposit account can be opened for one month, three month, six

month, one year, three year, and five year. The account will be closed after the

term then new account will be open on the demand of customer.

MCB bank limited is offering some other types of account these are mention

below.

Basic Banking Account:

MCB bank is offering these services to those people who have low

income without any charges. No Zakat is deducted from their balance and there

is no profit no loss on this account.

Khushali Bachat Account:

It offer profit rate on semi annually balance.

For opening of new accounts there are required some documents


For individual account

Account opening form

Attested photocopy of computerize National Identity Card or Passport of

individual.

In case of salaried person, attested copy of his or her service card or any

other acceptable evidence of service, including, but not limited to a

certificate from employer.

If the person has his or her own business then the letter pad copy is

needed.

In case of illiterate person, two receipt passport size photographs of the

new account holder besides taking his right and thumb impression on the

specimen signature card.

For Joint Stock Companies Account

Certified copies of

Resolution of board of directors for opening of account specifying the

person or person’s authorized to operate the company account.

Memorandum and Article of Association

Certificate of incorporation

Certificate of commencement of business

Attested photo of Computerized National Identity Card of all Directors.

List of Directors in from-29 issued for the Register Joint Stock Companies.

For Partnership Account

Attested photocopy of computerize National Identity Card


Attested copy of “ Partnership Deed” or “letter of Partnership”

Attested copy of Registration Certificate with Registrar of the firm. In case

of Partnership is unregistered, this fact should be clearly mentioned on the

Customer Relationship form.

Authority Letter in original, in favor of the person or other person who is

authorized by the partners.

Account Opening Form is filled and necessary documents are attached with this

Form and are sent to main Branch. After verification the main branch send mail

of verification then the new is activated.

2. Clearing department

I have worked two weeks (2nd ad 3th ) in clearing department. I learned

the functions and work which are performed by this department. This is the

important department of any bank.

General banking officer (GBO) Miss Mareeha Yasmeen taught me about

clearing. He told me that it is a process in which the banker settle their mutual

account by claiming the arising account of various instruments presented by one

bank drawn on the other bank either the bank is in the same city or out of city.

Suppose an NBP account-holder gives a crosscheck for MCB. Similarly, MCB

account-holders give check to people having accounts in other banks; these all

banks need to clear their overall balances with each other. The clearing

department does this.

NBP Bank

Clearing checks

X Cross check

Y MCB Deposited

MCB

Account-holder

NBP

Account-holder


In clearing we deal with the cheques of other banks or other branches of

MCB. The clearing is done with the help of NIFT (National Institutional Facilitation

Technologies). It is the institute which the state bank has hired for the collection

of clearing cheques of each branch and it plays middle man role between each

branch with State Bank of Pakistan.

He told me that clearing are of two types

Outward clearing

Inward clearing

Outward clearing

Out ward clearing is that the settle of claims of our branch of MCB bank

but drawn on other branches of MCB or on other banks .These cheques are

deposited by our customer in our MCB branch and then our MCB bank branch

present it in out ward clearing.

GPO told me that there are three types of out ward clearing.

i. Normal clearing

ii. Someday clearing

iii. Intercity clearing

Before starting clearing GBO gave me the first task to record the detail of

cheques in the cheque Collection ( CC ) ledger. The detail includes pay account

number, cheque number, cheque amount, bank name of which the cheque is.

And I wrote the all amount of all cheques on Add list and add it. Two copies were

made one original and second carbon copy. I attached add list and all the bank

copy of deposit slip which were filled from customer in the CC ledger. GBO

appreciated me that your calculation is good. The same task is done either it is

Normal, Same day, or intercity clearing.


These are the following detail are required in Clearing Register.

1. Serial No.

2. Account no. of the depositor

3. Depositor name

4. Drawer

5. Drawee

6. Cheque No.

7. Amount of the cheque

Normal clearing

Normal clearing is made at afternoon which would be present on next

day.Two stamps are stamped one on front of clearing date stamp and one on

back manager stamp that payee account will be credited with signature. It

deals with in city. Time limit of this type of clearing is two days. Return on paid

charges are Rs.300 which are deducted from the depositor account is case of

retire of cheque.

Same day clearing

Same day is made initial working hours and are presented on the

same day. Three stamps are stamped on back of the cheque and one on

front of the cheque. On front side, one stamp of Same day clearing and

second stamp of clearing date on which cheque has to present. On back side,

manger stamp that payee account will be credited, and manager signature

also. Its charges are Rs.350 only charges that are deducted from the account

of holder account.


Intercity clearing

Where there is State Bank of Pakistan then the clearing is done by

NIFT and if not then another institute is worked so CC ( cheque collection ) is

made. Three stamps are stamped two on front side and one on back side.

On front side one stamp of intercity clearing and other is clearing date on

which it has to present. On back side manager stamp that payee account will

be credited and manger signature also.

In paid charges are 400+64posting charges

In case of normal clearing, detail information is recorded the detail in ledger. A

clearing schedule slip is arranged with the branch code stamp, total amount and

number of instruments and add list is also attached with clearing schedule slip

then a plastic seal number is required which is written on the seal.

After matching the detail of clearing Register with clearing schedule slip all

the instruments, add list, outline page are putted in an envelope and packed in

NIFT bag and that NIFT bag is closed with that plastic seal. This is to ensure

additional safety. When the seal is opened then the bank will not receive that

bag., If the seal number on the bag and on the bundle cover does not match in

this case it is a suggestion that some sort of changes has been made the strict

action are taken by NIFT and the Bank consequently.

The procedure is same for same day clearing and intercity clearing.

Inward clearing

In inward clearing other banks or other branches of MCB also settle their

account by claiming the instruments which are drawn by the other bank


customers or other branches of MCB bank. This is inward clearing other banks

sent instrument to our branch which are drawn on us.

There are few things which are included in inward clearing.

a. The cheques should be cross cheques or there should be cross stamp on

face side of the cheque.

b. Clearing stamp on the back side of the instruments.

c. The clearing stamp dated should be of the next working day

d. Manger stamp that Payees account is credited on the back of the

instruments and signature on the stamp

e. The signature is to be verified before entering into computer and then the

cheque is posted and drafted.

3. Remittance Department

I have worked two weeks (4th and 5th ) In Remittance Department. We

deal with different functions and different instruments in this department.

Those instruments and function are:

1. Demand Draft (DD)

2. Pay order ( PO)

3. Online transfer or internal transfer

4. Call Deposit Receipt (CDR)

5. Deposit slip

1. Banker’s Cheque

Demand draft is like an instrument and is issued on the demand of the

customer.DD has abominate the extra burden of the currency. It is payable on


the demand when the customer want it. It is issued by the one branch of the bank

and is payable by another branch of the same bank.

Information required for DD

Beneficiary Details

Beneficiary Name

Bank or Branch Name and address

Purpose of remittance

2. Online Transfer

The amount can be transfer from one account to another account either

the account is of that branch or any branch of MCB in any city.

If the amount is being transferred through cheque then online charges are

Commission Rs.200

Excise duty Rs.32

Total charges Rs.232

If the amount is being transferred through Cash then the charges are different. If

the amount is less than Rs. 25000 then

Commission Rs.300

Excise duty Rs.48

Total Charges Rs. 348

If amount exceed from Rs.25000 then the taxes is also applied due to this total

charges also changed.

Information required for online


Beneficiary Details

Beneficiary Name

Bank or Branch Name and address

Purpose of remittance

Applicant Detail

Name or Title off account

Account number

CNIC or Passport No.(for Non Account Holder)

Signature of Applicant

3. Call Deposit Receipt (CDR)

It is highly liquefied instrument which can be cashed at any time on the

demand of customer. it is used for tender purpose.CDR show that the specific

mentioned account is present in between customer and other party with which

deal is being done. In this case issue and paying branch is same.

4. Deposit Slip

There are two copies of deposit slip one is for bank use and other for

customer use. We fill deposit slip in case of cash deposit in account holder

account and when any cheques come in the branch.

This was the worked that I had learned from MCB bank limited. I have used great

effort to learn about banking sector hoped that this effort will provide me

opportunities. It is great edge for me in the job market. It gave a lot of confidence

that to deal the customers. It will create positive impact on my future.


REFFERENCES

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

http://www.mcb.com.pk/psc/accounts/basic_account.asp

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

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

Annual Report 2014 of MCB bank limitd

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

http://www.mcb.com.pk/psc/accounts/basic_account.asp

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

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

waqar sharif report

Documents