Press Release

VIS Reaffirms Ratings of Basel 3 Compliant Additional Tier-I (TFC-V) Instrument of United Bank Limited

Karachi, June 26, 2024: VIS Credit Rating Company Limited (VIS) has reaffirmed the rating assigned to TFC-V (Basel 3 Compliant Additional Tier-I debt instrument) of United Bank Limited (‘UBL’ or the ‘Bank’), at ‘AA+’ (Double A Plus). The long-term instrument rating of ‘AA+’ denotes high credit quality; protection factors are strong; risk is modest but may vary slightly from time to time because of economic conditions. Outlook on the assigned ratings is ‘Stable.’ The previous rating action was announced on June 27, 2023.

The Bank raised Rs 10.0 billion through the issuance of rated, perpetual, and unsecured Term Finance Certificates (TFCs) in January 2019. The Bank may, at its sole discretion, call the TFCs, at any time after five years from the issue date subject to prior approval of the State Bank of Pakistan (SBP). Mark-up on the TFCs is only to be paid from the current year's earnings and if the Bank is fully compliant with SBP’s Minimum Capital Requirement (MCR), Capital Adequacy Ratio (CAR) and Liquidity Ratio (LR) requirements. Ratings have been notched down from the entity rating of UBL, given that the subject TFCs may, at the discretion of the SBP, be either permanently converted into ordinary shares or permanently written off (partially or in full), pursuant to the loss absorbency clause.

For further information on this ratings announcement, please contact at 021-35311861-64 or email at info@vis.com.pk.

Applicable Rating Criteria:

Financial Institutions
https://docs.vis.com.pk/Methodologies%202024/Financial-Institution-v2.pdf
VIS Issue/Issuer Rating Scale
https://docs.vis.com.pk/docs/VISRatingScales.pdf

Information herein was obtained from sources believed to be accurate and reliable; however, VIS Credit Rating Company Limited (VIS) does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. VIS, the analysts involved in the rating process and members of its rating committee do not have any conflict of interest relating to the rating(s)/ranking(s) mentioned in this report. VIS is paid a fee for most rating assignments. This rating/ranking is an opinion and is not a recommendation to buy or sell any securities. Copyright June 26, 2024 VIS Credit Rating Company Limited. All rights reserved. Contents may be used by news media with credit to VIS.