Press Release
VIS Upgrades Short-term Ratings of First Credit and Investment Bank Limited
Karachi, May 16, 2025: VIS Credit Rating Company Limited (VIS) has upgraded short-term entity rating of First Credit and Investment Bank Limited (‘FCIBL’ or the ‘Investment Bank’) from ‘A/A2’ (Single A/A Two) to 'A/A1' (Single A/A One). Medium to long term rating of 'A' indicates good credit quality; protection factors are adequate. Risk factors may vary with possible changes in the economy. Short term rating of 'A1' indicates strong likelihood of timely repayment of short-term obligations with excellent liquidity factors. Outlook on the assigned ratings remains ‘Stable.’ Previous rating action was announced on February 26, 2024.
FCIBL is a Non-Banking Finance Company (NBFC) with non-deposit taking status and its primary operations include the provision of funded and non-funded based facilities and advisory services. The assigned ratings incorporate the strong sponsorship profile of the Investment Bank with two government-owned entities, namely, National Bank of Pakistan (NBP) and Water and Power Development Authority (WAPDA), having majority shareholding.
The ratings reflect its stable credit profile, supported by strong sponsorship from two major state-owned entities, which provide a firm foundation for potential financial support if needed. Corporate governance is strong, with a well-structured board and adherence to regulatory requirements. The Investment Bank maintains a conservative approach to lending, with a focus on secured term finance facilities, and its asset quality remains manageable. The investment portfolio is predominantly composed of low-risk government securities, mitigating exposure to credit risk. The assigned ratings take into account the improvement in profitability profile supported by a positive spread on arbitrage and income from other sources. This increased the equity base in the absence of payouts, supporting the capitalization. However, returns on assets and equity need further improvement to cover the opportunity cost of capital. Liquidity is adequate, with a comfortable coverage of short-term obligations, as reflected in the upgrade of the short-term rating. Going forward, the Investment Bank’s strategic initiatives, including diversification into brokerage services and potential deposit-taking, signals a shift towards broader funding access, which could enhance financial flexibility and market presence.
For further information on this rating announcement, please contact at 021-35311861-64 or email at info@vis.com.pk.
Applicable Rating Criteria:
Non-Bank Financial Companies
https://docs.vis.com.pk/Methodologies%202024/NBFCs202003.pdf
VIS Issue/Issuer Rating Scale
https://docs.vis.com.pk/docs/VISRatingScales.pdf