Press Release
VIS Reaffirms Entity Ratings of United Bank Limited
Karachi, June 30, 2026: VIS Credit Rating Company Limited (VIS) has reaffirmed entity ratings of United Bank Limited (‘UBL’ or the ‘Bank’) at 'AAA/A1+' (Triple A/A One Plus). Medium to long term rating of 'AAA' indicates highest credit quality; the risk factors are negligible, being only slightly more than for risk-free Government of Pakistan’s debt. Short term rating of 'A1+' indicates strongest likelihood of timely repayment of short-term obligations with outstanding liquidity factors. Outlook on the assigned ratings remains ‘Stable.’ The rating of UBL’s Basel III compliant Additional Tier-1 (ADT-1) TFC-5 has also been reaffirmed at ‘AA+’ (Double A Plus). Previous rating action was announced on June 30, 2025.
Listed on the Pakistan Stock Exchange (PSX), UBL operates through a domestic and international branch network of 2,033 (Dec’25: 2,009; Dec’24: 1,474) branches in Pakistan, including 775 (Dec’25: 752; Dec’24: 496) Islamic Banking branches, 02 (Dec’25: 02; Dec’24: 02) branches in Export Processing Zones, and 08 (Dec’25: 08; Dec’24: 08) branches outside Pakistan. The Bank’s branch network expanded significantly following the amalgamation of Silk Bank Limited during CY25. UBL is a subsidiary of Bestway International Holdings Limited, which held 64.0% of the Bank’s issued share capital as at Dec’25. UBL has been designated a Domestic Systemically Important Bank (D-SIB) by the State Bank of Pakistan (SBP).
The ratings assigned to UBL reflect the Bank’s strong franchise, and established market position within Pakistan’s banking sector. During the review period, the Bank demonstrated significant balance sheet expansion, primarily driven by growth in deposits, particularly current accounts, as well as expanded treasury operations. In addition to an extensive domestic footprint and improving market share, the Bank has also advanced its international book in recent reporting period. Profitability indicators strengthened materially in CY25 on the back of higher earnings from the treasury book, lower funding costs, and a reversal in provisioning charges, while operating efficiency improved despite higher administrative and technology-related expenses. Asset quality indicators remained manageable, with improvement in net infection levels, strong specific and general provisioning coverage, and limited residual pressure of delinquent exposures on Tier-1 capital. Although relatively high exposure to longer-duration, fixed rate treasury securities and interest rate swap positions expose the Bank to unexpected upward movements in interest rates, a sizable volume of non-interest rate sensitive liabilities substantially hedges the risk from such interest rate movements. The investment portfolio remained predominantly concentrated in sovereign exposures, thereby containing credit risk.
Liquidity indicators remained strong, supported by a sizeable liquid asset base, a granular deposit franchise, and liquidity metrics significantly above regulatory requirements. Capitalization indicators also remained sound, underpinned by strong internal capital generation and adequate buffers over minimum regulatory thresholds despite growth in risk-weighted assets. Going forward, the ratings remain dependent on the Bank’s ability to maintain asset quality in the context of currently elevated credit risks in the domestic and international markets, preserve profitability in a lower interest rate environment, and manage concentration and market risks associated with its expanding investment portfolio.
For further information on this rating announcement, please contact at 021-35311861-64 or email at info@vis.com.pk.
Applicable Rating Criteria:
Financial Institution
https://docs.vis.com.pk/Methodologies-2026/FI-Methodology-26.pdf
Instrument Rating
https://docs.vis.com.pk/Methodologies-2025/IRM-Apr-25.pdf
VIS Issue/Issuer Rating Scale
https://docs.vis.com.pk/docs/VISRatingScales.pdf