mauritiusMauritius Commercial Bank (MCB)

All data are collected in the Fiscal Year of 2008-2009.

Company Profile and History

Mauritius Commercial Bank (MCB) is the oldest and largest banking institution of Mauritius. It operates a network of 42 branches and over 4,000 point of sale terminals across the island.

In 1838, several British merchants and traders, including James Blyth and William Hollier Griffiths, established the Banque Commerciale de l’îsle Maurice to compete with the only other bank, the Bank of Mauritius, which favoured the planters on the island.

In 1839, Her Majesty Queen Victoria granted a Royal Charter to the newly established bank for a period of twenty years under the name of the 'The Mauritius Commercial Bank'. The charter was renewed every twenty years until 18th August 1955 when the Bank became a limited liability company. During its first hundred years of existence, the Bank encountered serious financial difficulties on many occasions. In spite of various national financial crises, fierce competition over the years from ten other commercial banks, two world wars and natural catastrophes, 'The Mauritius Commercial Bank Limited' succeeded in expanding its activities, trebled its capital and opened its first branch in Curepipe in 1920.

Between 1991 and 1999, The Mauritius Commercial Bank Limited started business in Paris, Reunion Island, Mayotte and the Seychelles, through its subsidiary, the Banque Française Commerciale Océan Indien as well as in Madagascar (through its locally incorporated subsidiary, Union Commercial Bank) and in Mozambique (through another locally incorporated subsidiary called União Comercial de Bancos).

In early 2003, the Bank finalised a joint venture agreement with the French banking group Société Générale, including a 50:50 partnership with respect to the BFCOI operations. However, the Seychelles assets did not form part of the arrangement and the latter’s banking operations are now operated under an MCB (Seychelles) label. Within its policy of establishing a unique network of services within the region, the Group has also been active in Tanzania and the Maldives with minor operations in a few other countries, including India.

This successful expansion of its activities has had a meaningful impact on MCB's international standing. It is the only local bank ranked among the top 1000 global banks and Top 18 Sub-Saharan Africa banks ( The Banker - “The Top 1000 World Banks 2009”); highest profitability among regional banks of the Indian Ocean according to the annual publication of Eco Austral “Spécial 100 premières Entreprises de l’Océan Indien”; it is the only local bank authorised to emit American Express cards as from October 2008; and the first SWIFT Member Concentrator in the entire Sub-Saharan Africa and Indian Ocean regions.

Moody's deposit ratings for MCB are stable at the country ceiling of Baa2/P-2 and the financial strength rating stands at D.

In Country Location

9-15 Sir William Newton Street, Port Louis, Mauritius;
Telephone: (230) 202 5000; Fax: (230) 208 7054

Services and Products

MCB provides various banking and financial services to individuals and corporate customers, and financial institutions worldwide, which include current, savings, fixed deposit, foreign currency, and foreign currency term deposit accounts; credit and debit cards; bank guarantees; safe deposit lockers; confidential reports; custody services; and telephone and Internet banking services. The company also provides car, educational, housing, personal, and other loans; private banking and leasing services; and nightsafe, merchant, fleet management, payroll, registrar, secretarial, and factoring services. In addition, MCB offers various trade financing products; international payment services; and travelling services, such as foreign bank notes, travellers checks, and business credit cards.

Number of Employees

2,233 employees in Mauritius

Financial Information

Market Share

MCB has a dominating 50 percent overall local market share. It has the largest market capitalisation on the Stock Exchange of Mauritius at Rs 31.5 billion as at 30 June 2009 representing 24.1 percent of the total market capitalisation. The bank also has over 40 percent market share in respect of credit to the economy and local currency deposits.

Business Objective

“To be the obvious choice for financial services in the region and beyond”

Business Model

“The MCB remains committed to its two-pronged strategy of product diversification and regional development and on the strength of the very material re-organisation of its systems, processes and human resources management over the last 4 years.

The MCB has had a tradition of being a leader adapting to changes and innovating to satisfy customer needs. Our Vision, Mission and Corporate values are aligned to maintain this stance. We fully understand that our future success will depend on our ability to deliver a comprehensive range of services quicker, cheaper and in a more efficient manner to our increasingly sophisticated and global customers. Towards that end, the Bank is investing heavily in human and technological resources.

Other axes of our competitive strategy are further product differentiation and regional diversification. Given the limited potential for growing market shares domestically, particularly in a context of subdued economic expansion, the Group, while consolidating its market presence in domestic banking services, has embarked on a two-pronged diversification programme. One arm of the diversification strategy involves furthering the extension of domestic activities into the provision of non-banking financial services from the existing base. Our goal is to serve as a single window offering a full-fledged package of financial services. We hope in the process to reinforce customer loyalty. The other arm of the diversification strategy involves strengthening and deepening our presence in foreign markets, which offer interesting investment opportunities as may be gauged from the growing success of our foreign subsidiaries thus far.

Basically, the gist of our competitive strategy is to substantially increase the contribution of subsidiaries and associated companies to the Group's profit. Ultimately, we strongly believe that the successful entrenchment of our strategies will lead to the reinforcement of a virtuous circle within our Group thereby providing higher quality service to clients while fostering greater staff satisfaction and yielding additional shareholder value. The key, of course, lies in striking the proper balance and the MCB already has its 167-year track record as testimony thereof.

Whilst adopting a more cautious approach in its operations on account of degenerating economic conditions, the MCB has pursued several business development initiatives at different levels during the last financial year. As such, the Group has made significant progress in relation to its ‘Bank of Banks’ strategy as gauged by its standing as the first ‘SWIFT Member-Concentrator’ in sub-Saharan Africa, the creation of a new subsidiary for card-processing needs of banks and key milestones reached with regard to the establishment of a letter of credit re-issuance hub.

At another level, in line with its strategy to diversify its revenue streams, the MCB has recently concluded a joint venture with a local insurance company for the provision of credit insurance services to customers wishing to cover for risk of default by debtors.”

Ownership of Business

Benefits Offered and Relations with Government

Mauritius has undertaken significant policy and legal reforms in order to strengthen its financial sector. As a result of reforms, there are two regulatory bodies: Bank of Mauritius (BOM), and the Financial Services Commission (FSC). The BOM is in charge of regulating, licensing, and supervising the banking sub-sector. It is part of the Offshore Group of Banking Supervisors (OGBS) and Eastern Africa Banking Supervisors Group. The FSC is in charge of regulating, licensing and supervising non-bank financial institutions

In order to consolidate the reputation of Mauritius as an international financial centre, a new legal framework regarding money laundering and terrorism financing has been set up through the adoption of the Financial Intelligence and Anti-Money-Laundering (FIAML) Act 2002 and its Regulations 2003, the Anti-Money-Laundering (Miscellaneous Provisions) Act (2003), the Prevention of Corruption Act 2002, and the Prevention of Terrorism Act 2002.

Mauritius has made considerable progress in reforming the legal framework relating to the BOM and banking, through the adoption of the Banking Act (BA) 2004 and Bank of Mauritius Act (BOMA) 2004 (both effective since October 2004). The BA 2004 eliminated the sharp distinction between domestic banks and offshore banks (previously Category 1 and Category 2 banks, respectively), by providing for banking business to be conducted under a single banking licence regime (effective June 2005).

Foreign banks are allowed to establish either as wholly-owned subsidiaries or branches, and to form joint-ventures with local banks. If the application for the banking licence is made (either singly or in joint-venture) by a branch incorporated abroad, the bank must be a "reputable international bank" that has operated as a bank for at least 5 years, and subject to consolidated supervision by competent foreign regulatory authorities. Any branch must be managed by persons appointed by the parent financial institution, subject to the approval of the BOM. Where the financial institution is a subsidiary (or an associate of a foreign banking group), the BOM may require that its board of directors be composed of 40 percent by non-executive directors instead of the usual 40percent independent directors.

During 2008/09, the domestic financial sector was subject to various changes on the legal and institutional front aimed at preserving stability and enabling the industry to adapt to new exigencies of the evolving operating environment. A key development relates to the decision by the BoM to shift to the full implementation of the Standardised Approaches of the Basel II framework as from the second quarter of 2009 given that an adequate state of readiness by banks to migrate to the new framework was observed during the parallel capital adequacy reporting under Basel I and Basel II.

In an endeavour to uphold financial stability, the Bank of Mauritius Act 2004 was amended in July 2009 to pave the way for the setting up of a Financial Stability Committee comprising the Central Bank, the Financial Services Commission as well as the Ministry of Finance and Economic Empowerment for a regular review of the soundness of the financial system. A Competition Commission was also established in early 2009 mainly to prohibit anti-competitive restrictive agreements. The Regional Payment and Settlement System was also launched in June 2009, providing a single gateway for central banks to effect trade payment and settlement on a complete real-time online system.

After being announced in the National Budget (July-December 2009), various measures affecting banks were proclaimed under the Finance Act 2009. As such, with a view to reinforcing public finances and adequately supporting the implementation of growth-enhancing policies, the special levy on profitable banks has been doubled to 1 percent of operating income and 3.4 percent of book profit for the financial years commencing 1 July 2009 and 1 January 2010, thus already impacting the MCB results in FY 2008/09. Moreover, all profitable firms, including banks, are required to either spend 2 percent of their book profit on Government-approved Corporate Social Responsibility activities or transfer the funds to the authorities to be used for social investment. Besides, following the Government’s decision to match its fiscal year to the calendar year, the tax year will be altered accordingly as from January 2010.

Product Development

Building on the success of the Port Louis Main Branch (PLMB) redesign in terms of enhanced customer experience, an overhaul of the entire branch network is currently under way with five branches having been completely remodelled during FY 2008/09. In addition to creating a more pleasant atmosphere and reinforcing the MCB brand, the new branch concept fosters greater customer proximity while promoting the ease and convenience of accessing the Bank’s offerings anchored on adapted enablers, including areas dedicated for specific services, self-service lobbies, greeters for informing and channelling clients more effectively, and active queue management among others.

The MCB improved the multiplicity of its delivery options in the last financial year by widening its ATM park to 146 locations, while technological advances include the setting up of ‘cash only’ ATMs at the large branch lobbies, hence providing faster cash withdrawal facility, and the launch of the first ever ‘Forex’ ATM in Mauritius at the Caudan and Flic en Flac branches. The latter machine allows customers to exchange foreign currency into MUR, thereby enabling them to spend less time queuing up at forex counters and banking halls as well as offering change facilities on 24/7 basis.