Press Release
VIS Upgrades Broker Management Rating of Adam Securities Limited
Karachi, January 13, 2020: VIS Credit Rating Company Ltd. (VIS) has upgraded Broker Management Rating of Adam Securities Limited (ASL) to ‘BMR2’ from ‘BMR3++’. Outlook on the assigned rating is ‘Stable’. Previous rating action was announced on January 9, 2019.
Rating signifies sound external control framework, client relationship and risk management along with adequate regulatory compliance levels, internal controls, client relationship, HR & IT services and financial management.
Assigned rating to ASL factors in the improvement in customer relationship management and internal controls. Complaint header on website’s homepage and addition of sms text complaint service has improved overall client relationship management while enhanced periodic review and sharing of policies with staff and customers adds to internal control environment. On regulatory front, addition of a director on board has positively impacted board level governance; nevertheless, further increase in board size would result in avoidance of common members in board level committees. Moreover, induction of independent director with relevant experience and qualification would strengthen overall board level governance.
Assessment of financial profile indicates weakening in core brokerage income given industry wide drop in trading volumes. Lately, ASL has initiated 2 new business lines i.e. corporate finance advisory and commodities. Significant contribution from these newly initiated lines of business will facilitate in revenue diversification, which is warranted.
For further information on this rating announcement, please contact Mr. Muhammad Tabish (Ext: 202) or the undersigned (Ext: 201) at (021) 35311861-66 or email at info@vis.com.pk
Javed Callea
Advisor
Applicable Rating Criteria: Broker Management Ratings 2017
http://vis.com.pk/docs/BMR201701.pdf