Internship Report

Meezan Bank Limited

A REPORT SUBMITTED TO THE DEPARTMENT OF MANAGEMENT SCIENCES,

VIRTUAL UNIVERSITY OF PAKISTAN IN PARTIAL FULFILLMENT OF THE
REQUIREMENTS FOR THE DEGREE OF MASTERS IN BUSINESS
ADMINISTRATION

Submitted By
Student ID MC180204580
Muhammad Tahir Iqbal
2018-2020
Submission Date: 10 th July, 2020

Department of Management Sciences,

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 Virtual University of Pakistan

Dedication
To my parents and family, thanks for their continued support and care. You have been great
source of inspiration for me.

Dedicated to Islamic Banking

Meezan Bank is Pakistan's first scheduled Islamic commercial bank, and operates strictly under
the principles of Islamic Shariah.

Muhammad Tahir Iqbal

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Acknowledgement
I am grateful to almighty Allah the most Gracious and the most merciful for enabling me to
accomplish this task successfully. I feel much obliged to my parents whose prayers and good
wishes have enabled me to reach this stage. I am thankful to my teachers for his help, advice and
guidance during studies. I would also like to say thanks to the Manager, staff and management of
Meezan Bank Limited for their cooperation and help. I am also thankful to all other people who
contributed their time & efforts in this regard.

Muhammad Tahir Iqbal

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 Table of Contents
Executive Summary…………………………………………………………………………….....3
Banking in Pakistan ………………………………………………………………………………7
Overview of Meezan Bank Limited………………………………………………………………8
Vision Statement………………………………………………………………………………….9
Mission Statement………………………………………………………………………………..9
Values…………………………………………………………………………………………….9
History of Meezan Bank………………………………………………………………………….9
Organizational Structure…………………………………………………………………………12
Business Volume………………………………………………………………………………...13
Product lines……………………………………………………………………………………..13
Introduction of departments……………………………………………………………………..20
Competitors……………………………………………………………………………………..21

PEST Analysis…………………………………………………………………………………...22
SWOT Analysis………………………………………………………………………………….23
Ratio Analysis…………………………………………………………………………………...26
Conclusion………………………………………………………………………………………27
Recommendation………………………………………………………………………………..28
References………………………………………………………………………………………28

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Executive Summary
This document provides detail of my achievements in term of understanding of working
environment in banks and comparison of academic knowledgewith actual implementation in
banking sector. Meezan Bank is the leading Islamic Bank in the country, and has always
played pioneering role in introducing technology based banking services.
MBL was granted a Scheduled Islamic commercial banklicense on January 31, 2002 are
formally commenced operations as a scheduled Islamic Commercial Bank with effect from
March 20, 2002 on receiving notification is this regard from State Bank of Pakistan (SBP)
under section 37 of the Statement Bank of Pakistan Act, 1956. In 2019 Meezan Bank Limited
opened 100 new branches, bringing the branch network to760 branches in223 cities across
Pakistan and it became the 6th largest Bank in Pakistan and largest Islamic Banking network
of Pakistan

Meezan Bank Limited being an Islamic Bank offering its products to its customers strictly in
accordance with the sharia compliance. It is doing business in Corporate Banking,
Commercial Banking, Consumer Banking, retail Banking, Investment Banking keeping in
view the all norms and standards of Islamic injunction.

Furthermore Meezan is a publicly listed company first incorporated on January 27, 1997. It
started operations as an investment bank in August of the same year. In January, 2002 in an
historic initiative, Meezan Bank was granted the nation's first full-fledged commercial banking
license dedicated to Islamic Banking, by the State Bank of Pakistan. MBL is incorporated in
Pakistan and engaged in Islamic and commercial banking. It is listed on all the stocks exchanges
in Pakistan. The adoption of new technology and offering new products has made MBL one of
the best domestic banks of Pakistan.

The banks’s deposit portfolio crossed the Rs.900 billion benchmark and closed at Rs.933 billion
recording a growth of Rs.148 billion in one year – 19% higher than the growth of previous year.

The banks’s total assets portfolio has crossed Rs.1.1 trillion, profit after tax has increased to
Rs.15.2 billion and contributed impressive growth of 70% in year 2019.

Islamic Banking has strengthens its roots in Pakistan with Meezan Bank as the market leader
offering complete range of Islamic Banking products and services. Islamic Banking Industry
deposits accounts for almost 16% of the total banking industry deposits. Meezan Bank’s share of
deposits amongst dedicated Islamic Banks operating in Pakistan is approximately 58% while its
share of the Islamic Banking Industry as a whole, including Islamic Banking windows of
conventional banks in Pakistan, is 35%.

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Meezan Bank’s business model consists of various departments including Retail Banking,
Corporate Banking, Investment Banking, Commercial Banking, Consumer Finance, Financial
Institutions and Correspondent Banking, Treasury, Product Development and Shahriah
Compliance, Operations, Service Quality, Alternate Distribution channels, Risk Management,
Internal audit and Risk Review, General banking department is concerned with daily operation of
the branch. This department is divided into four sections which are Cash section, Clearing
section, Remittance section and front office operations. Cash section performs cash related
function like receipt of cash, payment of cash. Clearing section performs the clearing of cheques
for collection. Remittance section performs transferring of funds from one branch to another or
from one account to another.

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Banking in Pakistan:
At the time of independence there were 631 offices of scheduled banks in Pakistan of which 487
were located in West Pakistan alone. As a new country without resources it was very difficult
for Pakistan to run its own banking system immediately. Therefore the expert committee
recommended that the Reserve Bank of India should continue to function in Pakistan until 30th
September 1948 so that problems of time and demand liability coinage currencies exchange etc.
are settled between India and Pakistan. The non-Muslims started transferring their funds and
accounts to India. By the end of June 1948 the number of officers of scheduled banks in
Pakistan declined from 631 to 225. There were 19 foreign banks with the status of small branch
offices that were engaged solely in export of crop from Pakistan, while there were only two
Pakistani institutions Habib Bank of Pakistan and the Australasia Bank. The customers of the
bank are not satisfied with the uncertain condition of banking. Similarly the Reserve Bank of
India was not in the favor of Govt. of Pakistan. The Govt. of Pakistan decided to establish a full-
fledge central bank. Consequently the Governor-general of Pakistan Quaid-E-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.
1) State Bank of Pakistan.
2) Commercial Bank of Pakistan.
3) Saving banks.
4) Co-operative banks
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5) Specialized credit institutions.
Up to December 31, 1973, there were 14 Pakistan commercial banks that functioned all over the
country and in some foreign countries through a network of branches. All these commercial
banks were nationalized in January 1, 1974, and were recognized and merged into the following
five banks:
1) National Bank of Pakistan
2) Muslim commercial bank limited
3) Habib Bank Limited
4) United Bank Limited
5) Allied Bank of Pakistan
The state bank of Pakistan is the Central bank of the country and was established on July 1,
1948. The separation of East Pakistan and its repercussion in the form of economic depression
has caused a lot of difficulties to the banking system in Pakistan. The network of bank branches

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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.
Overview of Meezan Bank Limited

Meezan Bank is Pakistan’s first and largest Islamic Bank and one of the fastest growing banks in
the banking sector of the Country. Founded with a vision to establish Islamic banking as
bankingof first choice, the Bank commenced operations in 1997 as Al Meezan Investment Bank
Limited. It converted to Meezan Bank Limited, a full-fledged Islamic Commercial Bank in 2002,
when State Bank of Pakistan issued its first-ever Islamic commercial banking license.
Concurrently bank acquired the Pakistan operations of Societe Generale, and started commercial
banking with a small network of four branches, that has now grown to become one of the largest
banking networks in the country with 760 branches in over 220 cities.

Meezan Bank stands today at a noteworthy point. The banking sector is showing a significant
paradigm shift away from traditional means of business and is catering to an increasingly astute
and demanding financial consumer who is also becoming keenly aware of Islamic Banking.
Meezan Bank bears the critical responsibility of leading the way forward in establishing a stable
and dynamic Islamic Banking system replete with dynamic and cutting-edge products and
services.
Meezan Bank Limited (MBL) (the holding company) was incorporated in Pakistan on January
27, 1997 as a public listed company under the company‟s ordinance, 1984 and its share quoted
in Karachi stock exchange. MBL was registered as an „Investment financing company on
August 8, 1997 and carried on the business of investment banking as permitted under SRO
585(I)/87 dated July 13, 1987 in accordance and in conformity with the principle of Islamic
sharia. A certificate of commencement of business was issued to MBL on September 29, 1997.

Meezan Bank is a publicly listed company sponsored by leading financial institutions from
Pakistan and the Middle East. The bank offers a complete range of Islamic Banking products and
services through an extensive retail banking network.

Meezan Bank has a strong shariah compliance setup that comprises of a dedicated Shariah
Compliance Department, a Resident Shahriah Board member and Shahriah Supervisory Board
comprising of internationally renowned scholars. The bank is well recognized for its product

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development capability, Islamic Banking research and advisory services, at both national and
International levels.

Vision statement:

Establish Islamic banking as banking of first choice to facilitate the implementation of an

equitable economic system, providing a strong foundation for establishing a fair and just
society for mankind.

Mission Statement:
To be a premier Islamic bank, offering a one-stop shop for innovation, value added products
and services to our customers within the bounds of shariah, while optimizing the shareholder
value through an organizational culture based on learning, fairness, respect for individual
enterprise and performance.

Values:

Shariah Compliance
Integrity
Professionalism
Service Excellence
Social Responsibility

Brief history
Al Meezan Investment Bank was established as an Investment Bank in October 1997 as a joint-
venture between Pak Kuwait Investment Company and Islamic Investment of the Gulf (the
former Investment Banking arm of the Dar ul Maal Islami Group) and commenced operations
with a total paid up capital of Rs. 721 million..
As a first step the Bank worked hand in hand with the State Bank of Pakistan (SBP) to develop
an Islamic banking framework including detailed criteria for setting up of Islamic banks in
December 2001. Meezan Bank then applied under the said criteria to convert itself into an
Islamic commercial bank. In 2002 the Bank acquired the Pakistan operations of Societe Generale
and concurrently converted itself into a full-fledged scheduled Islamic commercial bank.
In 2003 Pakistan's first Shariah-compliant Housing finance product, Meezan Bank's Easy Home was
launched. In 2004 the SBP constituted a Shariah Board to regulate and approve guidelines for the
emerging Islamic banking industry. Online banking, a 24/7 Call Centre and Meezan Bank ATM/Debit Card
was launched across all branches of Meezan Bank. In 2005 Meezan Bank launched the Meezan Islamic
Institution Deposit Account. The deposit structure of Meezan Bank's deposit products was changed from
Musharkah to Mudarabah and new deposit products were launched. Meezan Bank became the first
customer of Islamic insurance (Takaful).

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In 2006 Internet Banking was introduced during the year. Meezan Bank was awarded 'Best
Islamic Bank in Pakistan' by Islamic Finance News of REDmoney Group, Malaysia. In 2007
Meezan Bank's branch network reached the milestone number of 100 branches (including sub-
branches) in 31 cities nationwide. The Bank introduced Istisna' financing to cater to the working
capital needs of customers. In 2008 Meezan Bank introduced Tijarah financing to allow
customers to raise funds for financing of stocks of finished goods. Branch network grew to 166
branches (including sub-branches) in 40 cities nationwide. In 2009 The branch network reached
201 branches (including sub-branches) in 54 cities nationwide. Being a socially responsible
bank, Meezan Bank launched Meezan Labbaik, a Hajj and Umrah product - the primary
objective being the desire to facilitate Muslims in performing their holy duty.

In 2010the products launched during this year were Meezan Business Plus, a Mudaraba-based
account that offers an array of free services for businesses, Meezan Euro Savings Account and
Meezan Pound Savings Account. During the year, 38 Islamic banking awareness seminars were
held Meezan Bank's branch network reached 222 branches in 63 cities across Pakistan and it
became the 11th largest bank in Pakistan in terms of branch network. During 2011, 53 branches
were opened to reach a landmark of 275 branches in 83 cities across Pakistan. Meezan Bank was
awarded the ‘Best Islamic Bank in Pakistan for 2011’ by Islamic Finance News of REDmoney
Group, Malaysia. The bank expanded its portfolio of consumer financing products with the
launch of Meezan Laptop Ease in first quarter of 2011 which is the first of its kind in Pakistan.
During the year 27 Islamic Banking Seminars and over 110 Customer Appreciation Days (115)
were held to educate customers and the general public and Islamic banking,The bank is now the
9th largest bank in terms of branch network.

2012 Meezan Bank reached 10 years of Riba-free banking with 310 branches in 90 cities. The
Bank launched Visa Platinum Debit Card for its customers. The Bank also started Premium
Banking Services and opened Premium Banking Centers throughout the country. Another
important achievement was the launch of Meezan Kids and Teens Club Account for the children
and teenagers who want to save money for their future.

2013 Meezan Bank became the 8th largest bank in Pakistan in terms of branch network with 350
branches in 100 cities. Total deposits of the Bank reached Rs. 280 billion. The Government of
Pakistan nominated Mr. Irfan Siddiqui, the President of Meezan Bank and Dr. Imran Usmani,
Shariah Advisor of Meezan Bank as members of Steering Committee for the Promotion of
Islamic Banking. The Bank also made an agreement with Ethical Finance Limited for
establishing first Islamic commercial bank in Republic of Mauritius. Total deposits reached Rs.
380 billion. Meezan Bank launched MasterCard Titanium debit card, Mobile Banking
Application, Meezan Kafalah (Takaful), EBiz - Corporate Internet Banking and Meezan Roshni-
Generator financing.In 2014 Meezan Bank reached a branch network of 428 branches in 117
cities.

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In 2015 the Meezan Bank acquired Pakistan operation of HSBC Oman and Meezan Upaisa was
established and it was World’s first Islamic Branchless Banking Services.
In 2018 Meezan Bank was awarded Best ‘Best Bank for 2018’ by Pakistan Banking Awards.
Also became 8th largest bank in Pakistan in terms of branch network in 2018.

At the end of 2019 a small commercial banking with a small network of four branches that has
now grown to become one of the largest banking networks in the country with 760 branches in
over 220 cities.

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Shariah Supervisory Board

Our in dependable Shariah Supervisory board, comprising of internationally renowned Islamic

scholars, regularly reviews the bank’s activities .

1. Justice (Retd) Muhammad Taqi Usmani (Chairman)

2. Dr. Muhammad Imran Usmani
3. Shikh Essam M. Ishaq (Bahraim)
4. Mufti Muhammad Naveed Alam

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Financial Backing / Business Volume

Shareholding structure % RS .in million

Noor Kuwait Investment Co 32.25 4,533
Pak Kuwait Investment 30.00 3,858
Company (Pvt.) Ltd.
IslamicDevelopmentBank,Jeddah 9.32 1,199
Others 25.43 3,270
Paid up capital 100 12,860

Product Lines

Personal banking

Meezan Bank provides a range of products and services for your Personal Banking needs. It
offers range of Deposit Accounts and Term Certificates to choose from, and uses Electronic
Banking services to access customers’ funds anytime / anywhere globally.

Services

Meezan Bank is dedicated in its effort to provide a quality banking experience to our
customers via a range of unique Banking Services as Labbaik Travel Aasaan,Online
Banking,8 to 8 Banking,Ladies Banking,Home Remittance andWestern Union Money
Transfer 

Consumer financing

Meezan bank consumer financing, provides Shariah Compliant financing solutions for
individuals with Car Ijarah ,Easy Home and Laptop Ease  

Electronic banking

Electronic Banking provides non-stop banking convenience, twenty four hours a day, seven
days a week. Visa Debit Card ,Internet Banking ,ATM Network ,Meezan QuickPay ,SMS
Alerts ande 24/7 Call Center 

Deposit accounts and term certificates

Deposit accounts in loacal and foreign currency are being offered which include Rupee
Current Account, Rupee Savings Account , Meezan Bachat Account , Labbaik Saving
Aasaan , Business Plus Account ,Dollar Saving Account ,Euro Saving Account, Pound

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 Saving Account, Meezan kids club and Meezan teens club.Also MeezanBank provides a
completerange of short term and long term deposit certificates with the flexibility of monthly,
quarterly, semi-annual and annual return.

 Corporate banking

In meezan bank corporate banking mainly accounts of corporate are maintained. Meezan
bank offers different funded and non funded financing facilities to the corporate clients to
cater their working capital requirements, trading requirements and project financing through
Murabaha, Musharikah, diminishing Musharkah, istisna, ijarah, tijarah and salm. In trading
goods could be imported under murabaha facility. Letter of credits could be opened.
Acquisition of any facility requires a complete procedure that would be discussed in detail in
corporate department.

Investment banking
Realizing the increasingly diverse needs of our customers for advisory and structured finance
transactions, a specialized department focusing on Investment Banking services has been
established at Meezan Bank. The department is geared towards providing comprehensive and
innovative financial solutions through a diverse product offering, providing a broad array of
financing solutions to the bank’s clients.
Asset mangement

Al Meezan Investment Management Limited (Al Meezan), the asset management and
investment advisory arm of Meezan Bank, specializes exclusively in the development and
management of Shariah compliant investment products. Al Meezan has one of the longest
and the most successful track record of managing mutual funds in the private sector,
spanning over fifteen years.

Treasurey and Financial institutions

Meezan Bank’s treasury is guided by Shariah with the objective of reviewing, streamlining,
and controlling the bank’s domestic and international Treasury-related operations. Financial
Institutions, a part of the Treasury and F.I. Group, primarily focuses on building and
maintaining relationships within the Financial sector. Relations range from authenticated
communication links by way of SWIFT RMA to Trade, Treasury and account maintenance in
different currencies worldwide

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 Advisory Service

The main objective of Meezan Bank’s Islamic Financial Advisory function is to assist
Financial Institutions develop Islamic banking alternatives by sharing our expertise, research
and success stories. This function works under th7.e guidance of Shariah Supervisory Board
which comprises of renowned Islamic Scholars from both Pakistan and abroad.

Deposit products:

Rupee Current Account:

1. Minimum amount required to open account is Rs.1000.

2. No /charges if the balance goes below Rs.10.000.

3. Free online Banking Services at our branches network nationwide.

4. No restriction on with drawls or number of transactions.

5. 24/7ATM card facilities is available.

Euro Saving Account:

1. Minimum amount required to open account is 100 EUR.

2. Profit will be paid for account with minimum amount of 10,000. Profit to be
disbursed on monthly Basis

3. No restriction on withdrawal or number of transactions

4. 24/7ATM card facilities is available

5. Zakat is not applicable on theses deposited

6. Withholding tax is applicable as per law

Pound Saving Account

1. Minimum amount required to open account is 100 sterling pounds.

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 2. Profit will be paid for account with minimum amount of 10,000. Profit to be
disbursed on monthly Basis

3. No restriction on withdrawals or number of transactions

4. 24/7ATM card facilities is available

5. Zakat is not applicable on theses deposited

6. Withholding tax is applicable as per law

Karobari Munafa Account:

KMA is high profile saving account

1. The account is available to all private limited public limited Sole proprietorship trust
or partnership account

2. Minimum amount required to open account.1 million

3. Profit will be calculated on a daily product basis calculated with reference to the
respective and weight ages announced at the beginning of the month

4. No profit will be paid if average balance fall below rs.1million

Karobari Munafa Account is unique daily product rupees saving account specifically tailored
for Business corporations, entrepreneurs and individuals. KMA combines a high rate of
monthly profit, flexibility of withdrawal and convenience all in one. The special tiring
structures ensures a higher profit on higher deposits.

Rupee Saving Account:

A unique bank account that offers the opportunity to earn Halal profits, while enjoying a
range of added benefits. It can be opened with a minimum amount of only Rs. 10,000. The
profit on this account is calculated and paid on a monthly basis, and comes with a variety of
free benefits, no restrictions on transactions, priority banking.

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Dollar Saving Account:

Riba free Dollar Saving Account works under the Principles of Mudarabah and is strictly in
conformity with the rules of Islamic Shariah.On agreeing to become an Account holder, the
customer enters into a relationship based on Mudarabah with Meezan Bank. Under this
relationship, the customer is an investor (Rabul mal), and the bank is the Manager (Mudarib)
of the funds deposited by the customer.

Meezan Bachat Account.

Meezan Bachat Account is a unique saving account that provides high monthly returns with
the flexibility to withdraw savings if needed. Thus Meezan Bachat Account offers higher
expected rate of return with the same convenience and service of a regular savings account.

Business plus Account

MBP IS variation of saving account with fractures of a current account.It is the first
remunerative current account of Meezan Bank. Open to individual as well as corporation
clients.

Minimum amount required to open account is 25,000.

Existent customer who has already evading facilities based on theybalance in current account
at MBL are mandate rye required to open this account to continue this services.

Meezan Kids Club Account:

Meezan Kids Club Account is introduced for children under the age of 12 years to cultivate
the habit of saving in the early years.

1. The account can be opened from Rs. 500.

2. On opening the account with Rs. 10,000 father/guardian is entitled to get free
accidental Takaful coverage for one year.

3. The profit is paid on monthly basis.

4. VISA Debit card fee is waived for the first year.

5. Exciting gifts are given to Kids Club members on account opening.

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Meezan Asaan Current Account:

Meezan Asaan Current Account provides swift and hassle-free account opening process,
since there is no requirement of submitting any proof of income document for opening this
account.

Account works on the basis of “Qard” and can be opened with a minimum investment of Rs.
100/- and a valid CNIC. There is a restriction on maximum withdrawal amount of Rs.

500,000 and above and maximum credit balance of Rs. 500,000 and above.

Meezan Asaan Saving Account:

Meezan Asaan Saving Account provides swift and hassle-free account opening process, since
there is no requirement of submitting any proof of income document for opening this
account.

Account works on the basis of “Mudarabah” and can be opened with a minimum investment
of Rs. 100/- and a valid CNIC. There is a restriction on maximum withdrawal amount of Rs.
500,000 and above and maximum credit balance of Rs. 500,000 and above.

Services:

Online Banking:

Meezan Bank offers free Online Banking facility on all Pak Rupee Accounts to its Online
Banking customers. This enables the Bank's customers to access their accounts and conduct
banking transactions from any of Meezan Bank's 551 branches nationwide, regardless of
which branch or city they have their account in. This facility provides great convenience for
depositing and withdrawing cash, making pay orders and availing numerous other banking
services.

Meezan Upaisa:

Meezan Upaisa is a joint venture of Ufone and Meezan Bank and is the world‟s first Islamic
Branchless Banking platform that enables customers to send money, perform bill payments
and top-up transactions through Shariah-compliant banking system. The services include the
following key features:

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■ Sending Money – Meezan Upaisa offers send money transaction to its customers with
competitive pricing. Customers just need to present their Original CNIC to send money to
any person pan Pakistan.

■ Bill Payments - Customers can pay their utility, internet bills at any Meezan Upaisa
Retailer without any extra charges.

■ Top Ups - Customers can top up their mobile credits for any teleco of their choice. In
addition, postpaid bills can also be paid through Meezan Upaisa Retailers and is supported by
a digital receipt of the transaction performed.

Internet Banking:

Meezan‟s Internet Banking facility provides customers global access to their account 24
hours a day, 7 days a week. The Internet Banking facility offers a suite of features such as
account statement views, payment of utility bills with QuickPay service, funds transfer
facility, check status of cheques, log and track complaints, and initiate request for check
books, pay orders, and stop payment.

Meezan Quick Pay:

Meezan Quick Pay allows customers to pay utility and postpaid mobile bills and top-up
prepaid balance through Meezan Bank's ATMs, Internet banking & Mobile App, meaning
that they no longer have to wait in queues to pay these bills.

SMS Banking:

Meezan SMS Banking is an interactive service that allows our customers to access their
account on demand anytime, anywhere from their mobile phone. It's not only simple and
easy.
Mobile Banking App:

Designed for the customer on the move, the app is available to download through Google
Play and Apple App Stores. Compatible with all major Android and iOS versions, the App
allows customers to view account activity, pay bills, top-up mobile phone credits and transfer
funds in a fast, convenient and a secure way.

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Meezan ATM Network:

Meezan Bank offers a nationwide network of over 490 ATMs located at its branches and at
prominent off-site locations across the country. The Bank also offers access to more than
7,000 ATM locations country-wide via 1-Link and MNET networks.

Car Ijarah:

Based on Ijarah principle, Car Ijarah is an auto finance facility. It is a car rental agreement
under which the Bank purchases a new/used car of the customer's choice and rents it out for a
period of 1 to 7 years, agreed at the time of the contract. Rental payments start after delivery
of vehicle to the customer. The Bank also provides Takaful cover of the car and free
accidental death coverage up to Rs. 400,000.

Bike Ijarah:

Based on Ijarah principle, Meezan Bike Ijarah is a Shariah-compliant solution under which
bank purchases the bike and rents it out to the customer for a period of 1 to 3 years, agreed at
the time of the contract. Rental payments start after delivery of vehicle to the customer. The
facility includes full comprehensive Takaful cover as well.

Easy Home:

Based on the principle of Diminishing Musharakah, Easy Home is a Shariah-compliant home

financing facility, in which a customer can buy or build a house, renovate an existing house
or replace the conventional house loan with Easy Home facility. With flexible financing
tailored to support the customer's need, Meezan Easy Home provides one of the best home
financing options in the country with a hassle-free process and a quick turn-around time.
Retail Banking, Commercial, SME & Agriculture Financing

Introduction of Departments

Treasury and Home Remittances

Corporate and institutional Banking
Consumer Finace
Investment Banking and Advisory
Operations

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Customer Support
Information Technology and Digital Banking
Information Secuirty
Shahriah Audit
Shariah Compliance
Internal Audit and BRR
Compliance
Legal Affairs
Risk Management
HRD
Finance
Competitors
Meezan Bank tracks the growth of Islamic Banking industry continuously, and tracks its share in
the Islamic as well as conventional banking industry, employing branch expansion and
relocation, deposit products, tailored services for individual and commercial customers as tools
to augment market position.
Major competitors are Financial institutions.
Bank Al Habib Ltd.
Bank Alfalah Limited
Standard Chartered Bank Ltd.
Bank Islami Ltd.
Faysal Bank Ltd.
Askari Bank Ltd.
Allied Bank Ltd.
United Bank Limited
MCB Bank Limited
Habib Bank Limited
Retail Banking, Commercial, SME & Agriculture Financing
Treasury and Home Remittances

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Corporate and institutional Banking

PEST Analysis

PEST analysis stands for "Political, Economic, Social and Technological analysis" and
describes a framework of macro-environmental factors used in the environmental scanning
component of strategic management.

Political analysis
Political factors are how and to what degree a government intervenes in the economy.
Specifically, political factors include areas such as tax policy, labor law, environmental law,
trade restrictions, tariffs, and political stability. Political conditions of any country do have an
impact on its major industries so no exception to the banking industry.
Government patronage and regulatory/tax reforms play a pivotal role for any industry to grow
with leaps and bounds. On the international front, governments  like  U.K and  Malaysia  are 
offering  relaxed rules  and  taxation  for  tapping  the  great demand  for  Shariah compliant 
investment.
Pakistan too can become a regional hub for Islamic finance if proper regulatory reforms 
are introduced. To achieve this goal, the Government needs to make structure conducive 
to Islamic finance. 

Economic analysis

Economic factors include economic growth, interest rates, exchange rates and the inflation rate.
These factors have major impacts on how businesses operate and make decisions. The 
emergence  and  growth  of  the  Islamic  finance  industry  is  a phenomenon 
that has generated considerable  interest  in  the  financial world  in  recent years. Given 
its ability  to  offer  innovative  financial  solutions  to  an  under served market,  it  is  seen  as  a 
socially responsible,  faith based banking  niche with  considerable  growth  potential.  The
economic impact of the massive flooding is quite extensive and preliminary estimates suggest
that economic costs could be quite significant.

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Socio-culture analysis

Social factors include the cultural aspects and include health consciousness, population growth
rate, age distribution, career attitudes and emphasis on safety. Trends in social factors affect the
demand for a company's products and how that company operates. Meezan Bank has continued
to maintain momentum in its socio-cultural environment in line with its sustainability drive. In
order to support the people affected by the devastating floods that occurred in August 2010,
Meezan Bank's employees contributed into a 'Flood Victims Relief Account'. The Bank teamed-
up with Afzaal Memorial Thalassemia Foundation on 8th May, 2010. Meezan Bank has
continued its support of Sind Institute of Urology Transplant and Shaukat Khanum Cancer
Hospital ,The Kidney Centre,and Markaz-e-Umeed. Meezan Bank also facilitated Children
Cancer Hospital (CCH) Karachi. In order to increase public awareness and understanding about
Islamic banking, the Bank conducted 38 seminars on Islamic banking all over the country during
2010. The 'Qarz e Hasna' scheme developed by Ihsan Trust and facilitated by Meezan Bank to
help needy and meritorious students in pursuing their higher being signed with various
universities all over Pakistan.

Technological analysis

Technological factors include technological aspects such as R&D activity, automation,

technology incentives and the rate of technological change. Furthermore, technological shifts can
affect costs, quality, and lead to innovation. Meezan Bank has a strong technology focus. It has
invested heavily in state-of-the-art software applications – namely Temenos T-24 and Oracle.  It
has also recently upgraded its hardware platform and also has a ‘hot’ disaster recovery site in
place to cater to any unforeseen eventualities.
Technology is having major impact on entire banking industry. Direct deposits allow companies
and governments to electrically transfer money into various accounts. Debit cards which may
also be used as ATM cards, instantaneously deduct an amount from account when the card is
swiped across the machine at stores’ cash register. Electronic banking by phone or computer
allows customers to access information such as account balances and statement history, pay bill
and transfer money from one account to another account. The use of cheque imaging allows
banks to store photographed cheques on computer instead of paper files. Meezan Bank has
engaged the services of two renowned data operators, Wateen and Multinet, to connect all its
branches and offices across the country using optical fiber.

SWOT Analysis

Strengths:
 The largest Islamic Bank in Pakistan with a network of over 760 branches in over 220
cities.

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 Meezan Bank limited has strong belief on customer services.
 Totally asset based financing.
 Generates real economic activities
 The products of MBL are very excellent
 The spirit of Islamic Banking rest upon absolute adherence to the Shariah.
 The members of the Shariah Supervisory Board of Meezan Bank are Internationally-
renowned scholars, serving on the boards of many Islamic banks operating in different
countries..
 The bank has also won customer loyalty by providing them shariah compliant products
and services.
 Excellent environment for the women as before women were reluctant to work in a bank.
 The staff at MBL is very efficient and Qualified
 No hidden charges are charged on customers
 Service charges Rates are remarkably low as compared to the other banks.
 A large range of true Islamic investment schemes.
 Fewer Competitors as Islamic Banking
 Bank has a belief in customer service .Customers give suggestion for the improvement of
bank and thesesuggestions are listened carefully.

Weaknesses:
 Lack of promotions and advertising of their products and services.
 Lengthy & extensive documentation
 Centralized procedures making process slow
 Weak marketing strategy, Target market not identified
 Risk Averse, approach of Head office.
 Too much burden of work on employees
 Less no of employees
 No separate corporate branch
 Restricted Shariah based policies
Less campaigns for awareness of Islamic banking
.
Opportunities:
 New competitors setting up their Islamic banking sections and they have the
infrastructure, skill, ability, resources & attitude to capture the market more than the
Meezan bank.
 More check and balance of SBP on Meezan bank
 Govt. policies are mostly for conventional banking system not for specially designed for
Islamic banking.
 Change in Government's attitude towards Islamic banking.

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  Fears on the credibility of Islamic banking ethical compliance and monitoring systems.
 Personal Loan Scheme of other banks.
 New Innovative Schemes by Other Islamic banks.
House financing sector can be targeted to maximize the profit.
 Growing demand of Islamic financial product and services.
 Venturing into Islamic groups out side the countries as opportunity to expand business in
UAE and Golf states. I-e financial institutions.
 Coming up with, products for the SME to targeting the medium level customers.
 Doing business with companies having Islamic mindset. I-e Islamic financial Institutions.
 Increase branch network within the country.
 Separate Corporate branch could be established
 Profit rate for customers should be increased.
 New Market Segments for ijara, i.e. Home Appliances Products

Threats:
 New competitors setting up their Islamic banking sections and they have the
infrastructure, skill, ability, resources & attitude to capture the market more than the
Meezan bank.
 More check and balance of SBP on Meezan bank
 Govt. policies are mostly for conventional banking system not for specially designed for
Islamic banking.
 Change in Government's attitude towards Islamic banking.
 Fears on the credibility of Islamic banking ethical compliance and monitoring systems.
 Personal Loan Scheme of other banks.
 New Innovative Schemes by Other Islamic banks.

Competition by the settled bank like MCB and others. There is a possibility that in future
the customers are too many to be handled by the so small number of the employees.

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Ratio Anlysis
In finance, a financial ratio or accounting ratio is a ratio a selected of two variables taken from
enterprise financial statements.There are many ratios used to try to evaluate entity financial
position.Financial ratios are used for comparision purpose and determine the relationship from
companys financial information.For banking sector common ratios that measure the stability of
business include Return on equity(ROE), Return on assets(ROA), Earning per share,Dividend
per share and price earning ratios etc.

Ratios 2019 2018 2017

Net Margin(%) 25.24 26.37 23.27
Operating margin(%) 45.69 55.21 59.34
Return on average equity(%) 30.66 23.77 19.26
Capital Adequacy ratio(%) 17 15 18
Return on average assets(%) 1.48 1.04 0.87
Profit after tax/Gross revenue 14.7 15.98 14.33
Earning per share(Rs) 11.84 6.97 5.56
Price earning ratio(Rs) 8.03 13.26 12.07
Financing/Advances to Deposit ratio-ADR(%) 52.9 65.3 63
Investment to deposit ratio(%) 24.2 15.75 17.87
Book value(Rs.) 45.89 34.5 32.31
Markete value per share(Rs.) 95.13 92.39 67.1
Price to Book value ratio(Rs.) 2.07 2.68 2.08
Cash Dividend(%) 50 35 30
Stock Dividend(%) 10 10

stock's P/E ratio doesn't indicate whether a stock is good or bad. It only indicates the
stock's price in relation to its earnings. A stock with a lower P/E ratio is typically
regarded as being cheaper than a stock with a higher P/E ratio. ... Stocks with a low P/E
ratio may be underpriced in the short term.Its going to decrease(8.03) which is good for
organization.
 Market price per share is used to determine a company's market capitalization.
increase the market value per share indicates high profitability in 2019(95.13) .
 Price to book value ratio measures whether or not a company's stock price is
undervalued. The higher the ratio, the higher the premium the market is willing to pay
for the company above its hard assets.so it is in positive trend in 2019(2.07) which is
good for organization.

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 cash dividend is the distribution of funds or money paid to stockholders generally as part
of the corporation's current earnings or accumulated profits. ... Long-term investors who
want to maximize their gains can reinvest their dividends.Bank has distributed more
dividends than previous year(2.07) which can be good or unsatisfactory depending
on sharehoders nature regarding their investing plans.
Stoch Dividend payments reflect positively on a company and help maintain investors'
trust. Dividends are also preferred by shareholders because they are treated as tax-free
income for shareholders in many jurisdictions. ... Therefore, it is utilizing its cash to pay
shareholders instead of reinvesting it into growt Bank has distributed more dividends
than previous year(50.00) which can be good or unsatisfactory depending on
sharehoders nature regarding their investing plans.
Higher EPS means that a company is profitable enough to pay out more money to its
shareholders.High EPS (11.84) is good for organization.
The capital adequacy ratio (CAR) is a measure of how much capital a bank has
available, reported as a percentage of a bank's risk-weighted credit exposures. ...
Therefore, the higher a bank's CAR, the more likely it is to be able to withstand a
financial downturn or other unforeseen losses.It is increasing (16.58) which is good.
Book value of equity per share effectively indicates a firm's net asset value (total assets
- total liabilities) on a per-share basis. When a stock is undervalued, it will
have a higher book value per share in relation to its current stock price in the market
So higher book value means the shares have more liquidation which is 45.89 according
to 2019 data.

Return on assets (ROA) is an indicator of how profitable a company is relative to

its assets or the resources it owns or controls. ... An ROA that rises over
time indicates the company is doing a good job of increasing its profits with each
investment dollar it spends.Its increasing (1.48) which is good.
A rising ROE suggests that a company is increasing its profit generation without needing
as much capital. It also indicates how well a company's management deploys shareholder
capital. ... A high ROE could indicate a good utilization of equity capital but it could also
mean the company has taken on a lot of debt.
Conclusion
While comparing Meezan banks’ strengths, weaknesses, opportunities and threats, I can say that
Meezan bank is doing very well over all as its branch network is increasing day by day. Further
Meezan banks has been established with the spirit of true Islamic banking and is offering a very
vast range of offers designed by keeping in mind a customer necessity. Meezan bank has very
bright future prospect. But to compete successfully and growth it has to seriously focus on its
promotion and Islamic banking awareness strategies. For this purpose Government should also
take serious initiative.

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Recommendation
Based on my observations regarding the operations and policies of Meezan Bank, I have tried to
stipulate some recommendations for further improvement.
 There should be devised a proper route for internees by helping them to learn in different
departments.
 No of employees should be increased in trade and corporate department so that the
burden of work could be balanced.
 Meezan bank should give its proper attention on promotion of it’s products and services
so that people should came to know about their usefulness.
Meezan can establish a separate institute for the general public to make them aware of the
Islamic banking

 If possible they should send their trained and well qualified employees who have
command on Islamic banking to different educational institutions after a certain interval.
 Management should distribute work equally among different employees. Some of the
employees are overburdened while some sections are overstaffed.
 Related jobs should be assigned to the employees so that they can work more efficiently.
 The employees should be signed jobs for specific period and than they should shifted to
other department so that they gain knowledge of other jobs as well.
 Lockers, ATM, all these facilities should be provided to attract more customers
 Increase the Size of waiting room.

References

Web sites

www.meezanbank.com

www.google.com

http://www.investopedia.com/terms/t/termdeposit.asp#ixzz1XqLViW6E

Books

LAWRENCE J GITMAN

Practice and Law of banking in Pakistan By Dr. ASRAR H SIDDIQUI.

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