Student Name Student ID MBA Finance

Finance (FINI-619) Internship report MCB Bank Thanil Fatohi Branch(1177)

Brief Introduction of the Organization It was established under the Indian companies act V11 as limited company by adamjee group on 9th of July 1947 In 1974 it was nationalized during the government of Mr. Zulfiqar Ali Bhutto. In 1991Nishat group purchase this bank and it was the first bank which was privatize. It is awarded as the “Best Bank in Pakistan” in 2001, 2003, 2004 and The 2 nd largest bank with deposit base Rs 431 billion and assets Rs 570 billion. Listen on London Stock Exchange. Head office is located in Karachi.

Business volume Particulars 2012(In millions) Total Assets 765,899 Total Liabilities 664,148 Total Sales 68,356 Shareholder Equity 88,157 Profit before tax 32,054 Profit After Tax 20,941 Total income 50,009 Earning Per Share Deposits 545,061 Advances 239,583 Investments 402,069 Authorized Capital 10,000 Paid up/ share capital 9,199 Bonus share 920

Main Rivals of MCB United Bank Limited Allied Bank Limited Bank al Habib Limited Bank al Falah Limited Askari Bank Faysal Bank Bolan Bank Limited Soneri Bank Limited Atlas Bank Limited Indus Bank Limited Meezan Bank Limited Bank Islami The Bank of Punjab

Training Program (Duties performed) Starting Date: 16 th of Dec Ending Date: 24 th of Jan Account opening, fill the account opening form Deposits, fill the deposit slips Demand draft and its working Cash and bills, pay and receive the amount for accounts and also fill the scrolls for collection of bills.

Learning Experience Knowledge Gained I observe the role of manager and know about management. Skills Learned: I learn about customer dealing and filling the concerned slips. Attitudes Observed/Values Gained: I practically know about team work and cooperation. Most Challenging Task Performed: The most challenging thing is to understand the behaviors and perception of different clients.

Ratio Analysis Ratio analysis MCB Bank Net Profit Margin= (Net profit after taxation / Net sales) * 100 Net Profit Margin Year 2010Year 2011Year ,873,175/ 54,821,296*100=30.7 7% = % 19,424,906/ 68,146,588 *100 = 28.51% 20,940,696/ 68,356,191 *100 = 30.63%

Ratio analysis MCB Bank Gross spread ratio=Net interest margin / Mark-up earned*100 Gross spread ratio Year 2010Year 2011Year 2012 =6,833,529/ 54,821,296*100 =0.67 times*100 =67% =4,526,314/ 68,146,588*100 =0.65 times*100 =65% 40,856,172/ 68,356,191 =0.59times*100 =59%

Ratio analysis MCB Bank Spread Ratio = Interest Earned / Interest Expense Spread ratio Year 2010Year 2011Year ,821,296 / 17,987,767 = 3.04 times 68,146,588/ 23,620,274 =2.88 times 68,356,191/ 27,500,019 =2.48 times

Ratio analysis MCB Bank Non Interest Income to Total Income Ratio = Non interest income / total income*100 Non Interest Income to Total Income Ratio Year 2010Year 2011Year 2012 =6,265,306/ 61,086,602*10 0 =10.25% =8,112,191/ 76,258,779*1 00 =10.63% =9,153,331/ 77,509,522*100 =11.8%

Ratio analysis MCB Bank Return on Assets= Net income after tax/Average Total Assets*100 Return on Assets (ROA) Year 2010Year 2011Year 2012 =16,873,175/ 538,388,170*100 =3.13% =19,424,906/ 610,392,918*100 =3.18% =20,940,696/ 709,566,107*10 0 =2.95%

Ratio analysis MCB Bank Du Pont Return on Assets= (Net income /sales) *(sales/Average total assets)*100 Du Pont Return on Assets Ratio Year 2010Year 2011Year 2012 =16,873,175/ 538,388,170*100 =3.13% 19,424,906/ 610,392,918 *100 =3.18% =20,940,696/ 709,566,107*100 =2.95%

Ratio analysis MCB Bank Return on Equity (ROE) =Net income after tax/stockholder equity*100 Return on Equity (ROE) Year 2010Year 2011Year 2012 =16,873,175/ 69,180,011 =0.243*100 =24.39% =19,424,906/ 78,915,003 =0.246*100 =24.61% =20,940,696 / 88,156,909 =0.237*100 =23.75%

Ratio analysis MCB Bank Debt Ratio = Total debt/Total Assets Debt RatioYear 2010Year 2011Year 2012 =488,348,404/ 567,552,613*100 =0.86 *100 =86% 564,430,741/ 653,233,223*100 =0.86 *100 =86% =664,148,186/ 765,898,992*10 0 =0.86*100 =86%

Ratio analysis MCB Bank Debt / Equity Ratio= Total Debt/Total equity Debt to Equity Ratio Year 2010Year 2011Year 2012 =488,348,404 / 69,180,011 =7.06 times = 564,430,741/ 78,915,003 =7.15 times = 664,148,186/ 88,156,909 =7.53times

Ratio analysis MCB Bank Times Interest Earned Ratio =Earnings before interest and tax (EBIT)/interest expenses Times Interest Earned Ratio Year 2010Year 2011Year 2012 =44,240,842/ 17,987,767 =2.46times =55,103,453/ 23, 620, 274 =2.33times =59,553,763/ 27,500,019 =2.16 times

Ratio analysis MCB Bank Advances / Deposits Ratio= Loans/deposits Advances / Deposits Ratio Year 2010Year 2011Year 2012 =254551,589/ 431,371,937 =0.59 times =227,580,139/ 491,188,710 =0.46 times =239,583,320/ 545,060,728 =0.44 times

Ratio analysis MCB Bank Operating Cash Flow Ratio=operating cash Flow/current liabilities Operating Cash Flow Ratio Year 2010Year 2011Year 2012 =58,701,161/ 274,715,687 =0.21 times =124,459,950/ 550,726,395 =0.22times =96,700,952/ 647,937,421 =0.14 times

Ratio analysis MCB Bank Dividend per Share=Dividend amount/No of equity shares Dividend per Share Year 2010Year 2011Year 2012 = 8,880,716/ 760,215 =11.68Rs =9,806,772/ 836,236 =11.72Rs =11,707,312/ =12.72Rs

Ratio analysis MCB Bank Earnings per Share =Net income/No of outstanding share Earnings per Share Year 2010Year 2011Year 2012 =16,873,175/ 760,215 =22.19Rs =19,424,906/ 836,236 =23.22Rs =20,940,696/ =22.76Rs

Ratio analysisMCB Bank Price/Earning Ratio =Price per share/Earning per share Price/Earning Ratio Year 2010Year 2011Year 2012 =228.54/ =10.29 times =134.60/ =5.79 times =209.76/ =9.21 times

Conclusion Bank should rely more on the interest income rather than non interest income Bank has to pays its shareholders dividend from its income as it is capable of doing this The ratios of the bank show profitability and smooth running of successful business

Recommendations for Improvement (According to learning experience) MCB should focus more on quality of customer services in this era of competition. There is a need to improve the customer and employee relationship. Bank must focus on the application of new and updated technology and train their employees side by side. There must be a concept of job rotation so that each employee must be able to perform every activity. Internal control should be more strengthened so that the performance of organizations increases.

Recommendations for Improvement (According to Ratio analysis) Net profit margin decrease in 2011 but in 2012 it shows increasing trend but there is need to increase the profit margin by minimizing the cost. There is a need to increase the interest income. Non interest income is not the guarantee of financial health of any business. Bank must not rely on its own asset instead it takes fewer loans to lessen the interest income. Return on equity is also shows diminishing trend in 2012 it shows that expenses are more. Try to reduce the interest expenses and attract more customers to increase the income of bank.

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