INTRODUCTION OF SECTOR

The word 'Bank' is said to have been derived from the words Bancus or Banque or Bank.
This history of banking is traced to as early as 2000 B.C. Banking in fact is primitive as human
society, for ever since man came to realize the importance of money as a medium of exchange,
the necessity of a controlling or regulating agency or institution was naturally felt. The priests in
Greece used to keep money and valuables of the people in temples. These priests thus acted as
financial agents. The origin of banking is also traced to early goldsmiths. They used to keep
strong safes for storing the money and valuables of the people. The first stage in the development
of modern banking, thus, was the accepting of deposits of cash from those persons who had
surplus money with them.

The goldsmiths used to issue receipts for the money deposited with them. These receipts
began to pass from hand to hand in settlement of transactions because people had confidence in
the integrity and solvency of goldsmiths. When it was found that these receipts were fully
accepted in payment of debts; then the receipts were drawn in such a way that it entitled any
holder to claim the specified amount of money from goldsmiths. A depositor who is to make the
payments may now get the money in cash from goldsmiths or pay over the receipt to the creditor.
These receipts were the earlier bank notes. The second stage in the development of banking thus
was the issue of bank notes.

The goldsmiths soon discovered that all the people who had deposited money with them
do not come to withdraw their funds in cash. They found that only a few persons presented the
receipts for encashment during a given period of time. They also found that most of the money
deposited with them was lying idle. At the same time; they found that they were being constantly
requested for loan on good security. They thought it profitable to lend at least some of the money
deposited with them to the needy persons. This proved a profitable business for the goldsmiths.
They instead of charging safe keeping charges from the depositors began to give them interest on
the money deposited with them. This was the third stage in the development of banking.

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 At the time of independence, there were 631 offices of scheduled banks in Pakistan, of
which 487 were located in West Pakistan alone. As a new country without resources it was very
difficult for Pakistan to run its own banking system immediately. Therefore, the expert
committee recommended that the Reserve Bank of India should continue to function in Pakistan
until 30th September 1948, so that problems of time and demand liability, coinage currencies,
exchange etc. be settled between India and Pakistan.

The non-Muslims started transferring their funds and accounts to India. By the end of
June 1948 the number of officers of scheduled banks in Pakistan declined from 631 to 225.
There were 19 foreign banks with the status of small branch offices that were engaged solely in
export of crop from Pakistan, while there were only two Pakistani institutions, Habib Bank of
Pakistan and the Australian Bank. The customers of the bank are not satisfied with the uncertain
condition of banking. Similarly the Reserve Bank of India was not in the favor of Govt. of
Pakistan. The Govt. of Pakistan decided to establish a full-fledge central bank. Consequently the
Governor-general of Pakistan Quaid-I-Azam inaugurated the State Bank of Pakistan on July 1,
1948. Thus a landmark was made in the history of banking when the state bank of Pakistan
assumed full control of banking and currency in Pakistan. The banking structure in Pakistan
comprises of the following types.

State Bank of Pakistan

Commercial Bank of Pakistan

Saving banks.

Cooperative banks

Specialized credit institutions.

Commercial banks have been the most effective mobilizers of savings and have been
providing short-term requirements of working capitals to trade, commerce and industry.

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 Up to December 31, 1973, there were 14 Pakistan commercial banks that functioned all
over the country and in some foreign countries through a network of branches. All these
commercial banks were nationalized in January 1, 1974, and were recognized and merged into
the following five banks:

National Bank of Pakistan

Muslim commercial bank limited

Habib Bank Limited

United Bank Limited

Allied Bank of Pakistan

The state bank of Pakistan is the Central bank of the country and was established on July
1, 1948. The separation of East Pakistan and its repercussion in the form of economic depression
has caused a lot of difficulties to the banking system in Pakistan. The network of bank branches
now covers a very large segment of national economy. The numbers of branches have increased
appreciably and there is now on branch of bank for every 3000 heads of population
approximately. There is done reasonable growth in deposits from the establishment of Pakistan.
Besides this growth, specialized credit and financial institutions have also developed over the
years.

The Government of Pakistan in the late 90’s introducing the need for the privatization of
state owned banks and companies. The private sector has accepted the challenge and most of the
banks are privatized today. The State Bank of Pakistan issues the shares of these periodically.
Bank employees and other common peoples can also purchase these shares and earn profit.
Throughout the period of banking history the banks have been expanding rapidly and achieved
the desired goal of progress.

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 THE MUSLIM COMMERCIAL

BANK LIMITED

HISTORY:

MCB was founded by ISFHANI and ADAMJEE families in Calcutta on July 9, 1947.
MCB is not an overnight success story rather good track of services are responsible for the leaps
and bounds progress. After the partition of the Indo-Pak Subcontinent, the bank moved to Dhaka
from where it commenced business in August 1948. In 1956, the Bank transferred its Registered
office to Karachi, where the Head Office is presently located. Thus, the bank inherits a 52-year
legacy of trust in its customers and the citizens of Pakistan

The performance of MCB was badly affected by bureaucrat government. In January

1974, MCB was nationalized by Bhutto Government following the bank act 1974 subsequently
in June 1974 Premier Bank Limited merged with MCB.

PRIVATIZATION:

When privatization policy was announced in 1990, MCB was the first to be privatized
upon recommendations of World Bank and IMF. The reason for this choice was the better
profitability condition of the organization and less risky credit portfolio which made'' it a good
choice for investors. On April 8th, 1991, the management control was handed over to “National
Group” (the highest bidders). Initially only 26% of shares were sold to private sector at Rs. 56
per share.

MCB besides being money financial organization have rendered invaluable services in
the economics and social developments of our country. MCB today, represents a bank that has
grown with time, experience and Pakistan. A major financial institution, in scope and size, it
symbolizes a fully-grown tree. Evergreen, Strong, and firmly rooted.

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 “VISION STATEMENT”

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

“MISSION STATEMENT”

“We are a team of committed professionals, providing innovative and efficient financial
solutions to create and nurture long-term relationships with our customers. In doing so, we
ensure that our shareholders can invest with confidence in us.”

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 “APPLICATION OF CLASS ROOM LEARNING”

During my internship of eight weeks in Muslim Commercial Bank, Ltd. Kot Farid
Branch, Sahiwal the knowledge given by my respected and devoted teachers proved to be very
helpful in understanding the environment in the organization and working practically.

Following are some key points about application of my class room learning in the
organization the knowledge achieved from the subject “Business Communication” helped me in
understanding customer dealing i.e. how to deal with them? How to understand their problems?
etc.It also helped me in understanding the inter Organizational Communication i.e. circulars,
notices etc.Also the Knowledge which I got from the subject “Computer application in Business”
also proved very useful.Financial Management and Principles of Accounting helped me in
understanding the accounting terminologies which are used in bank e.g. what is debit and credit
vouchers? What are these for? And also in understanding that how entries are made against
certain heads.

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 “WHAT I HAVE LEARNT IN MCB”

In Muslim Commercial Bank Ltd. I really enjoyed working with the staff of Kot Farid
Branch, Sahiwal having a wish to be employee of MCB. It was almost impossible to work in all
the departments within that limited time. But the staff of the branch provided me the opportunity
to work in the different departments for the sake of practical knowledge. I feel highly indebted to
work in the Kot Farid Branch with the manager of that branch Mr. Yasin Tahir, because I learnt a
lot in that branch.

During my internship training in the MCB as I early mentioned that I have worked in
different departments & seats and learnt the following things,

How to deal with different types of customers.

Account opening.

Cheque book issuance.

Outward clearing.

Cheque for Collection.

Different forms and vouchers filling.

Experience of working in a well reputed organization.

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 “MCB’s SWOT ANALYSIS”

“STRENGTHS”

MCB is the first Pakistani privatized bank and because of its quality management,
marketing, innovation in products and services. Owing to all such factors they have established a
good reputation in the banking market. The name of MCB makes you recall the highly
cooperative and professional individuals ready to serve you with maximum zeal and zest.

The joining of experienced people, advanced management, advance setup and facilities
gave MCB an edge over its competitors.

MUSLIM COMMERCIAL BANK’S IMAGE:

MCB is a reputable financial organization and is well known all over the Pakistan.
Perception is of producing a high quality services.

CUSTOMER CARE:

The Bank not only provides high quality services but it also look for the comfort and
convenience of the clients, MCB always preferred their customers.

MARKET SHARE:

MCB has covered much of the potential market and the net profit is increasing years after
years. Deposits and advances have sufficiently increased.

LARGE NUMBER OF DIVERSIFY PRODUCTS:

This is also its main strength as it has diversified in many products such as:

Debit Card

Visa Card

Car Financing

Agriculture Financing

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BRANCH NETWORK

It is the greatest strength of the Bank. In 2004, five more branches were added to the
network and by the end of the year 2005 the total number of branches was raised from just 53 to
143. MCB has also planned to open more branches in next coming years.

SOUND MARKETING:

Skillful marketing of the products is being achieving countrywide goals of Muslim

Commercial Bank Limited.

PHONE BANKING:

Every account holder can conform its balance on Phone and may ask for any query.
There are also 24 hours help lines for customers.

MOBILE BANKING:

It has been launched recently. It helps in getting accounts details and making transactions
using mobiles.

HIGHLY AUTOMATED BANK:

MCB in Pakistan is the also in the list of highly automated banks, about 750, like
Emirates because of its modern style of banking through fully computerized control and twenty
four hour banking.

FASTER BANKING SERVICE:

MCB have faster banking services that are making it more prominent in the banking
industry especially in operations and Foreign exchange. The customer prefers this bank not only
because of its faster speedy service rather due to reasonable service charges.

INTERNATIONALLY DESIGNED PRODUCTS:

MCB’s products are internationally designed products. These are valuable and
operational in all over the world.

CONTRACT WITH CIRRUS:

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 Now MCB has also entered into a contract with Cirrus which is a subsidiary of
MasterCard. This contract will enable an ATM card holder to use his account even when he is
out of country at all the ATMs where Cirrus logo is displayed.

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 “WEAKNESSES”

ADVERTISEMENT:

The majority of people are not well aware about the products of MCB. Therefore it
should advertise extensively especially RTC and Master Cards.

ACCOMMODATE BEHAVIORALLY:

A behavior has been noted that bank tries to feel at ease with good looking, rich and
educated people and the poor looking customers feel some bit strange in the environment of the
bank. The bank employees should try to accommodate behaviorally all type of customers.

MISMANAGEMENT OF TIME:

Mismanagement of time is another big mistake in MCB branches, the bank official time
of closing is 5:30pm but due mismanagement of time allocation and work the staff is normally
on their seats till 7:00 or 8:00 clock.

AND ALSO,

Costly documents are required for loan sanctioning.

Some times bank also never meets stated rate of profit

“OPPORTUNITIES”

PRIVATIZATION:

As on December 31, 1998, sixty-eight scheduled banks with 9,106 branches are operating
in Pakistan. As on this date, total population of Pakistan is 140.03 million. Total number of
personal accounts with all scheduled banks as on December 31,1997, are 28.98 million. If we
consider the population statistics of working age group as on December 31,1997, it stands to the
figure of 96.64 million. Thus we can say those 28% of working age people of Pakistan are
having accounts with banks while 72% are unbanked.

The need of privatization has made people to switch to banks to satisfy their needs of
lending and borrowing. This not only increases the deposits but also the credit business.

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DIVERSIFICATION:

They may enter in New business or any other consumer-durable product in order to
promote their name, by introducing Loan for the students, small businesses, and handicraft
industry.

SOME MORE OPPERTUNITIES:

Information Technology.

Credit cards can give more earning.

Establishing more foreign Branches.

They should introduce Student Finance Facility.

They should also introduce mobile ATM

“THREATS”

CHANGE IN GOVERNMENT POLICIES:

Change in government policies has affected the banking business. Still banks have to wait
to get permission of state bank. The freezing of foreign currency accounts is a vital example of
letting people not to trust on banks.

COMPETITION:

The Competition has become severe by the entrants of so many banks, So to exist one
will have to prove himself in its services through excellent management and will have to satisfy
its shareholders. Otherwise he will be out the market.

LOW INVESTMENT:

The decrease purchasing power of consumer in the current economic situation of the
country affecting the business activity speed too much and the result is the low investment from
the investors in new projects can create problem for the bank because it is working a lot in trade.

STATE BANK REGULATION:

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 As the Bank introduces unique products so they face problem if State Bank Of Pakistan
employ taxes on them which force them to increase the rate of Interest.

EXPECTATIONS OF THE PEOPLE:

Due to huge competition among those banks and MCB,, people are the basic
beneficiaries from it and thus their expectations tend to increase about the products and the
relative rate of interest thus creating a threat for MCB.

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 “PEST ANALYSES”

PEST analyses tell How Political, Economical, Social and technological factors affect
MCB. These are the external factors which affects the whole organization.

POLITICO-LEGAL FACTORS:

Stable government

Stable policies in favor of business

Improved relation with outside world

Law and order.

UNSTABLE GOVERNMENT:

Due to this reason foreigners hesitate to invest their savings in banks, as a result of
economy of our country is going downward and banks suffer.

ADVERSE LAW AND ORDER SITUATION:

The situation of law and order is adverse. The policies are not very handy and beneficial
for the country. The Govt. passes such rules which are not in the favour of bank e.g. The Govt. of
Pakistan has passed a rule that if anyone withdraws more than Rs.25000 then he will be charged
0.30% on withdrawal.

ECONOMIC FACTORS:

Pakistan's economy is going weaker and weaker. 9/11 has a great influence on the
economic crisis of all over the world. With economic factors the bank influenced very much that
are as under:

Impact of WTO force to cost reduction methodology.

Low interest rate

Inflation

Low GDP growth

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 Budget deficit

Increase in Govt. duties

Fluctuation in exchange rates

SOCIAL FACTORS:

Social environment includes family, friends, a person's role and status. An individual’s
life directly by society and the person acts according to his or her society. Cultural environment
includes norms, values, religion, conception and perception.

If we see the religion point of view then interest is not allowed that's why most of the
people hesitate to invest their savings in banks and yet they are not aware of ISLAMIC
BANKING.

Traditional business men do not like the business with bank. They pay their creditors
through cash not through cheque. They do not want to get the bank facilities.

TECHNOLOGICAL FACTORS:

Today is the era of technology. In the every aspect of life technology plays an important
role.

 Due to rapid change in technology every bank has to change its technology to
compete other ones.
 Increasing issue of securities due to technology resulted increase in cyber
crime. Cyber crime means manipulation. One person can easily transfer
amount from any other's account to his account.

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 Week wise learning

 First Week

Name Organization
Muslim Commercial Bank Ltd. Jaman Shah

From 28 May 2018 to 30 July 2018

Weeks DETAIL
 First Week When I enter in the bank I feel shay. Because it is my first
experience. I don’t know how to perform work in the bank. After
this I met with Mr. M. Waqarand asked some question about
myself like my name father name address and about my study.
After this he introduce me with all staff and I feel confidence after
mating with all members. And give me ruff idea about my work
like deposit department account department and how to open an
account.

In second day my supervisor M.Waqartell me about my task and

completely guide me how can perform it. In this day I learn about
cash voucher. And how can we fill it

In this day I learn aboutcheque voucher. And how can we fill it.

Cheque received from a customer pass the entries in the register

I fill a deposit voucher for the customer

This day I learn who can I issue a cheque book

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 Second week

Name Organization
Muslim Commercial Bank Ltd. Jaman Shah

From 28 May 2018 to 30 July 2018

 Second week DETAIL

I learn public dealing from my supervisor.

Learn about accounts and types of accounts. Required documents

for accounts.

This day I learn the complete procedure of account opening.

I learn about opening of new account for the customers.

This day I again perform my previous task account opening

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 Third week

Name Organization
Muslim Commercial Bank Ltd. Jaman Shah

From 28 May 2018 to 30 July 2018

 Third week DETAIL

Type letter for the Management on Computer System.

This day I fill up cheque and cash voucher for customer.

I involve opening of new accounts and filling up cheque vouchers

for customers

Posting the cheque in register and tally with cashier

Receive the cheque books and make their entries and learn the
procedure of remittance

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 Fourth week

Name Organization
Muslim Commercial Bank Ltd. Jaman Shah

From 28 May 2018 to 30 July 2018

 Fourth week DETAIL

Fill the demand draft for customers.

This day I learn clearing procedure and also perform regular

activities.

EID Holiday

In this day I perform regular activities

Type a letters for the management.

Opening a new account.

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 Fifth week

Name Organization
Muslim Commercial Bank Ltd. Jaman Shah

From 28 May 2018 to 30 July 2018

 Fifth week DETAIL

I spend whole day in public dealing.

I spend whole day in public dealing.

Learn about cross cheque

I learn mail transfer from supervisor

Fill the demand draft for customer and filling up cash voucher.

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 Sixth week

Name Organization
Muslim Commercial Bank Ltd. Jaman Shah

From 28 May 2018 to 30 July 2018

 Sixth week DETAIL

I learn about pay order. And also pass the entry in cash book.

I learned about returned cheque.

Cheque received and pas the entry in register

I learn about UNI remote and perform routine activity

Last day of my internship I meet with all staff and say thanks to all
supervisors who help and guide me in my internship period. And
learn me about practical life and give me some suggestion.

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 “SUGGESTIONS & RECOMMENDATIONS”

Following are some suggestions for Muslim Commercial Bank, Ltd.

ADVERTISING:

Bank must let potential customers know that all attractions for banking exist. This is done
by advertising on television and obtaining press coverage, in conjunction with direct mail,
window displays, leaflet in branches and in appropriate other locations (such as hotels, shops,
etc.) and including leaflets in statement of accounts sent to existing customers in the hope that
they will tell potential customers about the services provided by our bank.

INCREASED ATM’S LOCATIONS:

Some personal sector customers prefer not to come to branch. They increasingly want to
deal with the bank in other ways, such as home banking or use of Automated Teller Machines
(ATMs), which need to be at every branch or some important shopping plazas and airports etc.

INCREASED SERVICES:

One way to retain the customers is to offer a wide range of services such as tax advice,
free life insurance equivalent to amount deposited, shares portfolio management, fund
management facility, etc., complimentary to the core services. Banks must have a slightly
different mix of services and mean of providing these such that customers can choose the mix
that suits them best.

MANAGEMENT OF TIME:

There should be a good management of time for the sake of employees i.e. offering them
free break hours instead of making them work in this time as well.

GROWTH SCOPE FOR EMPLOYEES:

MCB should provide greater facilities to its employees, and give them bonuses for their
hard work and Promotions as well. There is a criticism on the banking management that the
salaries of the employees are decreasing in every succeeding year. And I think this will shake the
confidence and working habit of the employees

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BANKING PROFESSIONALS:

The bank should hire banking professionals having experience in their respective fields
that will boost the performance of the company as currently MBAs are produced for this field so
they should be hired for enhancing the performance of company.

ATTRACT CUSTOMERS:

The banking company should offer such policies which would attract customers which
are denied by other banking in the market.

JOB ROTATION AND PROMOTIONS:

Most of the bank employees, are sticking to one seat only with the result that they
become master of one particular job and loose their grip on other banking operation. In my
opinion all the employees should have regular job experience all out-look towards banking. The
promotion policy should be adjusted

COMMUNICATION SYSTEM FOR EMPLOYEES:

As such system should be designed that every employee who has some problems with his
officers can communicate it to the higher management and some steps must be taken to improve
that.

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