MCB Bank Limited

MCB Bank Limited
Traded as PSX: MCB
Industry Banking
Capital Markets
Commercial Banking
Corporate Banking
Investment Banking
Treasury Services
Founded 1947
Headquarters Lahore, Pakistan
Key people
 Husnain Ijaz (Chairman)
Products Loans, credit cards, savings, consumer banking, Home Remittance etc.
Revenue Increase₨66.43 billion (US$630 million) - 2015[1]
Increase₨25.55 billion (US$240 million) - 2015[1]
Website www.mcb.com.pk
MCB Office (MCB Tower) in Karachi, Pakistan.

MCB Bank Limited (formerly Muslim Commercial Bank) was incorporated by the Adamjee Group on July 9, 1947. The bank was established to provide banking facilities to the business community of South Asia. The bank was nationalized in 1974 during the government of Zulfikar Ali Bhutto. This was the first bank to be privatized in 1991 and the bank was purchased by a consortium of Pakistani corporate groups led by Nishat Group. As of June 2008, the Nishat Group owns a majority stake in the bank. The president of the bank is Imran Maqbool.

The group has a presence in business sectors of the country such as banking, textile, cement and insurance. Mian Muhammad Mansha is chairman of both the group and MCB.

Business strategy

The bank has also established an Islamic Banking unit to offer Shariah compliant products and services, with dedicated Islamic banking branches in six cities.

The Wholesale Banking Group caters to local and multinational companies.

Areas such as Bancassurance set newer records as well by crossing the Rupees 1 billion benchmark in 2011. Islamic Banking outperformed in terms of improved profitability and volumes with introduction of additional 11 products and expansion with 8 new branches in 2011 and Privilege Banking, an elite setup, is a benchmark in the industry. They have nine branches across major cities.

Information technology

MCB’s name is synonymous with ATM facility in the country as the bank has been a pioneer in introducing 24-hour cash withdrawal facility and on-screen transactions. MCB ATM/Debit Card, with its collaboration with VISA, can be used globally.

MCB and Maybank

In 2005, the management of the bank abbreviated its name from Muslim Commercial Bank Limited to MCB Bank Limited to explore international markets; they were facing resistance due to the word Muslim especially from Western Countries to avail license. In 2008 the head office of MCB was shifted from Karachi to Lahore in a newly constructed building, namely MCB House located at Sharea Ghous-ul-Azam, commonly known as Jail Road.

MCB, advised by Merrill Lynch, became the fourth Pakistani Company (the other three being Hubco, PTCL and Chakwal cement - they all have been delisted) to list on the London Stock Exchange when it raised US$150 million global depositary receipts.

In May 2008, Malaysian bank, Maybank and MCB signed an agreement, whereby Maybank acquired 20% of the ordinary shares in MCB from Nishat Group. The acquisition is in-line with Maybank’s strategy, as Malaysia’s financial services leader in the region, to build its presence in key growth markets across the region. It also paves the way for MCB, one of Pakistan’s premier financial services groups, to engage Maybank as its exclusive foreign commercial bank strategic partner.

Maybank initially acquired from Nishat Group 94,241,527 ordinary shares in MCB, representing a 15% stake in the Bank, for a cash price of PKR470 per share. The total consideration paid was approximately US$686 million. The purchase price represented an 11.4% premium to MCB’s closing share price of PKR 422 on May 2, 2008, and a premium of 12.9% to the average closing share price for MCB over the 30 trading days immediately preceding the date of this announcement.

Based on MCB’s December 31, 2007 audited book value, the purchase price represents an implied price to book value multiple of 5.13x, a price to 2007 earnings multiple of 18.0x and a price to 2008 earnings multiple of 15.2x. In July 2008 Maybank exercised its right to increase its stake to 20%.

The stake in MCB allows Maybank the right to appoint two Directors to represent its interest on the Board of MCB. One of these Directors was to be appointed immediately and the second Director will be appointed upon completion of the term of the existing Board, scheduled to be on March 27, 2009.

As part of the transaction, Maybank and MCB are also expected to enter into a business cooperation arrangement which will include, among others, Islamic banking, retail banking, credit cards, asset management and SME banking. Maybank and MCB are also expected to benefit from increased business ties and trade flows between Pakistan and Malaysia

See also

Notes

  1. 1 2 "MCB Annual Report 2015" (PDF). MCB.com.pk. Retrieved 10 April 2016.

References

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