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MCB Bank Ltd    

DRAFT MINUTES OF THE 61st  ANNUAL GENERAL MEETING HELD ON FRIDAY, MARCH 27, 2009 AT 3:00 PM AT ISLAMABAD

A list of shareholders who were present (list attached) in addition to the following: 

1.	Mr. Aftab Ahmad Khan	Director - (0.037% proxy)
2.	Dato' Mohammed Hussein	Director - (20% proxy)
3.	Mr. Ali Munir	SEVP/Head of SPIG
4.	Mr. Muhtashim Ashai	Acting President/CEO
5.	Mr. Salman Zafar Siddiqi	Chief Finance Officer
6.	Mr. Abdus S. Sami	Company Secretary-(54.065% proxy)

At the request of the Company Secretary Mr. Mansur Ahmed recited the Holy Quran before the commencement of the proceedings of the Meeting. After the recitation, the Secretary while welcoming the shareholders to the 61st Annual General Meeting of the Bank, informed that about 82% shareholders personally or through proxies are present and therefore the shareholders general meeting could be convened.

The Secretary also informed the member that due pressing engagements the Chairman and the President were not able to attend the meeting. The Secretary on the proposal of Mr. Abdul Hameed (Folio # 83254) which was seconded by Mr. Abrar Hussain (folio # 0470536877) requested Mr. Aftab Ahmad Khan, Director, to chair the meeting.

The Secretary further informed the members that External Auditors represented by M/s. Farid Ahmed and Bilal Ali, Partners of Ms/ KPMG Taseer Hadi & Company and Mr. Muddasar Mahmood Partner of M/s. Riaz Ahmad & Company, Chartered Accountants, were also present in the meeting.

The Secretary, with the permission of the Chairman, started the proceedings as per the Agenda notified in the English & Urdu newspapers of the March 6, 2009:

1.    To confirm the minutes of 60th Annual General Meeting held on 28th March, 2008

The Secretary read out the minutes/resolutions and requested the members that if they had any observations on the minutes or they wish to raise any question on the minutes they are free to do so. Since no questions were raised by any member Mr. Asghar Abbas (folio # 036411187) proposed that the minutes of the 60th AGM are confirmed which was seconded by Mr. Shakeel Hasan (folio # 036416582) and the following resolution was passed:

'RESOLVED that the minutes of the 60th Annual General Meeting held on 28th March 2008 at Islamabad having been read be and are hereby approved.'

2.    To receive, consider and adopt the audited accounts of MCB Bank Ltd. & consolidated accounts of MCB Bank Ltd. and its subsidiaries for the year ended 31st December 2008 together with the Directors' and Auditors' report including post facto approval of (a) donations made during the year 2007 and (b) Rs. 1,524,000/- remuneration to the Chairman; reported at note 39 of annual report, as required under SBP Prudential Regulations:

The Chairman requested Mr. Ali Munir to enlighten the shareholders on the developments and the achievements made by the Bank during the year 2008.

Mr. Ali Munir informed the members that during 2008 Maybank, Malaysia acquired 20% of Banks equity and Dato' Mohammed Hussein, Director, representing Maybank shareholding, has come to Islamabad to attend 61st Annual General Meeting of the Bank and he extended warm welcome to Dato' Mohammed Hussein for being present in the Meeting. He further informed the members that Maybank, Malaysia is our strategic partner and Bank has signed Banking Cooperation Agreement (BCA) with Maybank whereby we both would benefit from each other's experience and expertise. In addition to this, your Bank and Maybank would explore the possibilities where both the banks could take advantage of current global crisis and join hands together.

With regard to financial results of the Bank, Mr. Ali Munir stated that 2008 had been a challenging year for both Pakistan and global economy and the effects of the economic imbalances in 2008 would be felt throughout 2009 where IMF predicts world growth to be just over 2% compared to 5% in 2007 and 3.75% in 2008.

He further added that for Pakistan the year witnessed:

• Balance of Payment crisis, rampant inflation, weakened rupee and flight of capital;

• In Banking Sector the interest rates were raised to 15% (an increase of 5%) in the face Global liquidity crisis;

• Severe energy crisis which resulted in significant losses for the industry and the country's economy;

• Due to the global financial turmoil the country's stock market collapsed and investors confidence in stock market was completely shattered;

• The Karachi Stock remained closed for more than 3 months and opened 15 days before the year-end which resulted into forced liquidation and distress selling;

• Politically the year 2008 remained tumultuous e.g. General Election, Labour Unrest, Mumbai attacks etc;

• And lastly global growth deteriorated following international credit crisis that has great repercussions on local industry and economy.

Despite all the negative factors highlighted earlier, the Bank continued to perform well and showed a robust growth of 13% in Deposits which increased to PKR 330.274 billion from PKR 292.098 billion in the year 2007. Similarly the gross advances grew by 19% from PKR 230 billion in 2007 to PKR more than 273 billion in 2008. The profits before and after tax for the year 2008 were PKR 21.868 billion and PKR 15.375 billion respectively as compared to PKR 21.308 billion and PKR 15.265 in 2007. Mr. Ali Munir then informed the members that Earning per share (EPS) of the bank stood at Rs.24.47 as compared to Rs.24.30 for the year 2007. Further, the return on average equity (ROE) stood at 31.49% as compared to 37.66% in the last year. The return on average assets (ROA) stood at 3.60% in 2008 against 4.06% in the year 2007. Bank's advances to deposit ratio resulted at 79.48% as compared to last year (2007), which was 74.96%. He further informed the members that during the year under review i.e. 2008 the bank's total assets grew by 8% to PKR 443.616 billion. Adequate provision has been made in accordance with Prudential Regulations in respect of NPLs. 

Further, Mr. Ali Munir stated that during the year 2008 the Bank had declared FOUR dividends including three interim cash dividends of Rs.3.00 per share for the first three quarters of 2008 and final dividend @ 10% in the form of Bonus Shares in addition to cash dividend of Rs.2.5 per share making a total cash dividend of Rs.11.50 per share and 10% bonus shares for the year 2008.

After the conclusion of the bank performance review for the year 2008, the Chairman asked the shareholders if they have any questions on the bank's performance during the year 2008 please feel free to ask questions. Mr. Masud Muzaffar (folio # 0470506282) stated that despite global crisis the results of the bank are excellent as compared to other major banks and we show our appreciation to the Board of Directors and the management for the good performance. Mr. Faaiz Amir (folio No. 0357401023) then proposed that the audited accounts of the Bank and consolidated accounts of MCB Bank Limited and its subsidiaries along with others be adopted which was seconded by Mr. Abdul Aziz (folio No.83284 ) and the following resolution was passed:

'RESOLVED that audited accounts of MCB Bank Limited and consolidated accounts of MCB Bank Limited and its subsidiaries for the year ended the 31st December 2008 together with Directors' Report thereon including post facto approval of Rs. 1,524,000/- remuneration to the Chairman; reported at note 39 to audited accounts be and are hereby received, considered and confirmed.'

3.    To approve, as recommended by directors, dividend @ 10% in the form of Bonus shares and cash dividend @ 25% i.e. Rs.2.50 per share, in addition to 90% (30% each 1st, 2nd & 3rd quarters) interim dividends already paid.

Mr. M. A. Abbasi (folio # 113945) proposed and Syed Samar Abbas (folio # 0628812650) seconded and the following resolution was passed:

'RESOLVED that as recommended by Directors, dividend @10% in the form of Bonus Shares and cash dividend @ 25% i.e. Rs.2.50 per share in addition to 90% (30% each 1st, 2nd & 3rd quarters) interim dividends be and is hereby approved.' 

4.    To approve that in the event of any member holding shares which were not an exact multiple (fractional shares) of his/her/their entitlement, the Company Secretary be authorized to sell such entitlements in the Stock Market and to pay the proceeds of sale when realized to any recognized charitable institution:

Mr. Ijaz Malik representing CFSIL RE Commonwealth Asian Share Funds (Folio No.0054703025) while agreeing with the proposed agenda item proposed that the following resolution is passed which was seconded by Mr. Abdul Hameed (Folio No. 83254):

'RESOLVED that in the event of any member holding shares which were not an exact multiple (fractional shares) of his/her/their entitlement, the Company Secretary be authorized to sell such entitlements in the Stock Market and to pay the proceeds of sale when realized to any recognized charitable institution be and is hereby approved.'

5.    To appoint auditors for 2009, namely M/s. KPMG Taseer Hadi & Co., Chartered Accountants, being eligible and have offered themselves for re-appointment and fix their remuneration:

The Secretary informed the members that the Bank's Board of Directors on the recommendations of Audit Committee has proposed the name of M/s. KPMG Taseer Hadi & Company, Chartered Accountants being single auditors in place of retiring auditors M/s. Riaz Ahmad & Company, Chartered Accountants and M/s. KPMG Taseer Hadi & Company, Chartered Accountants (joint auditors). The Secretary further informed that M/s. KPMG Taseer Hadi & Company, Chartered Accountants being eligible have offered themselves for reappointment. 

Mr. Ali Munir informed that as approved by the Board of Directors one Audit firm i.e. M/s. KPMG Taseer Hadi & Company, Chartered Accountants eligible for reappointment has been retained for the audit of the Bank. He explained the members that the appointment of two Audit firms was 1991 legacy when it was required to appoint two duly approved audit firms for bank's audit. However, at present there was no regulatory requirement to appoint two audit firms. Further many other banks have opted to appoint only one audit firm for its audit and hence upon the recommendations of Audit Committee the Board of Directors has approved only one audit firm namely M/s. KPMG Taseer Hadi & Company which has been proposed before the shareholders for reappointment. With regard to their remunerations, Mr. Ali Munir stated that since the workload and the responsibility to deliver audited accounts on due dates would increase manifold, the members are requested to consider delegating negotiation and agreeing the audit fee with M/s. KPMG by CFO and the President. 

Syed Amir Zaidi (folio No. 113958) appreciated the suggested recommendations by the Bank's Board of Directors and proposed reappointment of external auditors M/s KPMG Taseer Hadi & Company with 10% increase in their remunerations for 2009, which was seconded by Mr. Ghulam Mohiuddin (folio No.449904399) and following resolution was passed:

'RESOLVED that M/s. KPMG Taseer Hadi & Co., Chartered Accountants be and are hereby re-appointed for the year 2009 with 10% increase in their total remunerations of the year 2009 including branches audit fee.'

6.    To elect twelve (12) directors as fixed by the directors in accordance with the provision of Section 178 of the Companies Ordinance, 1984 for a term of 3 years:

     

The Secretary informed the members that the existing nine (9) directors are retiring and are eligible for re-election. Further, as notified to the shareholders in local newspapers in Urdu as well as in English on the 20th March 2009 the Company Secretary received from shareholders thirteen notices of intention offering themselves for election of Directors at today's General Meeting. However, one of the candidates intimated to us on the 25th March 2009 his intention to withdraw from the election of directors due to personal reasons. Therefore holding of election of directors would not be required as the remaining twelve gentlemen deemed to be elected directors for a term of 3 years starting March 28, 2009 against the number of directors fixed by the Directors and their names are:

1.	Mian Mohammad Mansha	7.	Mian Raza Mansha
2.	Mr. S. M. Muneer	8.	Dato' Mohammed Hussein
3.	Mr. Tariq Rafi	9.	Mr. Aftab Ahmad Khan
4.	Mr. Shahzad Saleem	10.	Mr. Abdul Farid Bin Alias
5.	Mr. Sarmad Amin	11.	Mian Umer Mansha
6.	Dr. Muhammad Yaqub	12.	Mr. Muhammad Ali Zeb

The Secretary congratulated the elected directors and asked the shareholders if they have any observations/comments/objections. In the absence of any comments/observations Mr. Mateen Ahmed Khan (Folio No. 089537) proposed that the twelve gentlemen who filed their nomination/intention letters stand elected. Mr. Abdul Hameed (Folio No. 83254) seconded the proposal and the following resolution was unanimously passed:

'RESOLVED that the election of M/s. Mian Mohammad Mansha, S. M. Muneer, Tariq Rafi, Shahzad Saleem, Sarmad Amin, Dr. Muhammad Yaqub, Mian Raza Mansha, Dato' Mohammed Hussein, Aftab Ahmad Khan, Abdul Farid Bin Alias, Main Umer Mansha and Muhammad Ali Zeb as directors for a term of three years starting from March 28, 2009 be and is hereby approved '

7.    Special Business: To consider and, if deemed fit, pass the special resolutions:

The Secretary read the resolutions already appeared in the newspapers on March 6, 2009 in the notice of Annual General Meeting with regard to investments made by the bank in the seed capital of MCB Asset Management Company Limited and remuneration to be paid to non-resident Directors.

Mr. Ali Munir explained to the members that MCB Asset Management Company was provided with seed money, when the funds were launched. However, as per regulatory requirements shareholders approval is required and the members are requested to grant post facto approval. Mr. Abdul Aziz (folio # 83284) proposed and Mr. Asghar Abbas (Folio No. 036411187) seconded the proposal and the following resolution with proposed amendment in the article 94 of the Articles of Association was passed:

a)    'RESOLVED that the post facto approval is given for the following investments made by the bank in the seed capital of following funds launched by MCB Asset Management Company Limited:

PKR. 250 million in MCB Dynamic Cash Fund

PKR. 250 million in MCB Dynamic Stock Fund

PKR. 100 million in MCB Dynamic Allocation Fund

b)    'ALSO RESOLVED that in addition to Boarding/Lodging and travelling expenses of directors for attending Board Meetings, non-resident Directors be paid a remuneration of US$7,500 per meeting for attending Board Meetings instead of Rs.30,000 per Board Meeting as being paid to resident directors.'

'FURTHER RESOLVED that Article 94 of the Articles of Association be and is hereby reworded as follows'.

Every director shall receive out of the funds of the Company as remuneration for his services a sum not exceeding Rs.30,000 for every meeting attended by him. However, a non-resident director shall be paid US$7,500 for attending Board meeting.  

A Director shall also be paid any reasonable travelling and hotel and other expenses incurred in consequence of his attendance at Board Meetings and otherwise in the execution of his duties as Director. The Directors may also be remunerated for any services done by them outside their ordinary duties.

As there was no other item of agenda, the meeting concluded with vote of thanks to the Chair.

                                

                                                                                                      APPROVED

    ___________________                                                                           ______________________

  ABDUS S. SAMI                                                                                   AFTAB AHMAD KHAN

COMPANY SECRETARY                                                                             CHAIRMAN

Dated: March 30, 2009

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