Press Release

JCR-VIS Upgrades Entity Ratings of Rozgar Microfinance Bank Limited

Karachi, May 20, 2011: JCR-VIS Credit Rating Company Limted (JCR-VIS) has upgraded the entity ratings of Rozgar Microfinance Bank Limited (RMBL) from ‘BB-/B’ (Double B Minus/Single B) to ‘BB+/A-3’ (Double B Plus/A-Three).

The upgrade takes into account the excess liquidity carried on books vis-à-vis financial obligations. The equity of the bank increased during the last year through right issue, following which the shareholding structure of the bank has experienced change, with two large investors now holding 49% stake. The bank was however still short of the minimum capital requirement (MCR) for district level MFBs by about Rs. 5.7m as at end Mar-2011. In view of this and regulatory requirements of MCR for 2011, ratings continue to be placed under ‘Rating Watch – Developing’ status.

With funds from the rights issue currently invested in government securities, the bank has been able to curtail losses presently, amidst business stagnation. To revitalize operations, the bank is in the process of developing a business plan. In addition to developing a road map for the future, the bank also needs to strengthen control mechanisms in view of past experiences. The performance and long term sustainability of the bank largely depends upon improving control mechanisms, and bolstering human resources. JCR-VIS will closely watch developments in this respect.

For further information on this rating announcement, please contact Ms. Sabeen Saleem, CFA (Ext: 510) or Mr. Manzoor H Memon, ChE (Ext: 512) at 35311861-70 or fax to 35311873.


Faheem Ahmad
President & CEO

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 May 20, 2011 VIS Credit Rating Company Limited. All rights reserved. Contents may be used by news media with credit to VIS.