Press Release
JCR-VIS Assigns Initial Entity Ratings to Sindh Leasing Company Limited
Karachi, April 28, 2015: JCR-VIS Credit Rating Company Limited has assigned initial entity ratings of ‘A/A-2’ (Single A/A-Two) to Sindh Leasing Company Limited (SLCL). Outlook on the assigned rating is ‘Stable’.
The ratings assigned to SLCL incorporate the ownership and implicit support of the Government of Sindh (GoS). Along with SLCL, GoS has also undertaken other projects in the financial services sector including a commercial bank and recently launched insurance and modaraba companies.
SLCL was established with an initial capital of Rs. 1b; with lending activities gradually picking up pace, the need for borrowings has so far not arisen. The institution currently carries sizeable amount of liquid assets on its books. Excess liquidity will be absorbed as the company forges ahead with its growth plans and borrowings are planned to be mobilized in the coming years, with debt leverage projected to increase to 4.7x by FY17. Support with respect to resource mobilization is evident by the intention to place Rs. 500m by the Sindh Province Pension Fund in Certificates of Investment to be issued by SLCL. With growth in lending activity and seasoning of the portfolio, underwriting quality will be tested over time.
Overall governance infrastructure is considered sound, with three of the seven members on the Board being independent directors; all Board committees are chaired by independent directors. Both the Board and management team include personnel having experience specific to the financial services sector.
For further information on this rating announcement, please contact the undersigned (Ext: 501) or Ms. Sobia Maqbool, CFA (Ext: 604) at 021-35311861-71 (10 lines) or fax to 021-35311873.
Javed Callea
Advisor
Applicable Rating Criteria:
Non-Bank Financial Companies (March, 2005)
http://www.jcrvis.com.pk/Images/NBFC.pdf