MCB Islamic Bank aims to expand its branch network to 66
The management of MCB Bank has decided to expand operations of its 100 percent owned subsidiary, MCB Islamic Bank Limited (MCBIBL) with 66 branches by the end of current year of 2016 in order to tap maximum opportunities in the demands and requirements of local market of banking industry.
According to official information available to Daily The Pak Banker the management is keen to enhance its penetration in the flourishing Islamic Banking industry with full-fledged new branches of its Islamic Banking subsidiary but it has been waiting for the go-ahead signal of Lahore High Court.
At present, the bank is operating with 6 branches which will be enhanced significantly with the demerger of branches of Islamic Banking Division having network of 34 branches which will enhance the numbers to 40 in short period of time.
The management has designed a conservative business strategy, which envisages a gradual growth in assets while maintaining sound asset quality. In initial years, the bank would focus its efforts on establishing primary banking infrastructure, including branch network, technology platform, and a comprehensive risk management framework.
MCBIBL has put in place a standard management structure alongside a preliminary governance framework. This should help MCBIBL to establish its market position relatively expeditiously.
However, MCBIBL's prospects are depend- ent upon the management's ability to establish its position. Effective implementation of business strategy is important. Healthy deposit mobilization and building a quality asset book will remain a key to meet performance targets.
The company of MCBIBL was formed as a banking company in May, 2014. It posted a quarterly profit of nearly Rs 35 million till September 2015.
Ali Muhammad Mahoon is the President of MCBIBL who is supported by an experienced management, most of them having prior association with MCB. MCBIBL is a wholly owned subsidiary of MCB - one of Nishat Group's major concerns having strong presence in the financial sector.
MCBIBL was provided by Rs 15 billion paid-up capital and share capital by MCB Bank to make its financial soundness up to the mark of the banking industry, and the standard set by the central bank.
PACRA Assigns Ratings to MCB Islamic Bank Limited The Pakistan Credit Rating Agency (PACRA) has assigned a long-term entity rating of "A" (Single A) and short-term rating of "A1" (A One) to MCB Islamic Bank Limited (MCBIBL). These ratings denote a low expectation of credit risk emanating from a strong capacity for timely payment of financial commitments. The ratings incorporate inherent constraints faced by MCBIBL, mainly limited branch network, small deposit base, and high cost structure particularly in early years.