Press Release
VIS Assigns Initial Broker Fiduciary Rating to Rafi Securities (Pvt) Limited
Karachi, June 02, 2025: VIS Credit Rating Company Ltd. (VIS) has assigned initial Broker Fiduciary Rating of ‘BFR3’ to Rafi Securities (Pvt) Limited (‘RSPL’ or ‘the Company’). Rating of ‘BFR3’ denotes good fiduciary standards. Outlook on the assigned rating is ‘Stable’.
The rating signifies adequate business & financial sustainability, ownership & governance, management & client services, and internal controls & regulatory framework.
RSPL is involved in investments, share and inter-bank brokerage, underwriting, advisory, and consultancy services. The majority shareholding (~97%) is held by the Chief Executive Officer (CEO), Mr. Naeem Rafi. The Company is registered with Securities & Exchange Commission of Pakistan and holds Trading Rights Entitlement Certificate (TREC) issued by Pakistan Stock Exchange Limited (PSX) for Trading and Self-Clearing Services. External auditors of the company are rated ‘B’ on the approved list of auditors published by the State Bank of Pakistan (SBP).
The assigned rating incorporates the Company’s ownership and governance framework, which may be strengthened through expansion of the board and inclusion of independent directors, thereby facilitating the formation of additional board committees. Additionally, appointment of ‘A’ rated auditors may also support the Company governance framework. Management and client services may be enhanced through making customer grievance procedures more pronounced. While contingency measures are in place, maintaining offsite backups at third party warehouse along with increasing the frequency of disaster recovery exercises may enhance these measures. Internal controls of the Company are in place, however, broadening the scope of internal control policies, along with documenting trade review policies for non-compliant and suspicious transactions, as well as conducting periodic reviews of the order recording system may further strengthen the internal control framework.
Assessment of the financial profile of the Company reflects strong growth in brokerage revenue, in line with overall positive industry trend, while profitability was supported by brokerage and capital gains driven by healthy growth in brokerage commission, supported by higher market activity amid positive investor sentiment. Consequently, the Company’s operational efficiency depicted improvement, with cost-to-income ratio standing at moderate levels. Liquidity profile of the Company is considered sound while the market risk is high. Capitalization indicators of the Company are considered adequate. Going forward, enhancement and diversification of revenue stream, along with managing market risk, as well as maintenance of capitalization indicators, liquidity profile and operational efficiency will be important for the rating.
For further information on this rating, please 021-35311861-64 or email at info@vis.com.pk
Applicable Rating Criteria: Broker Fiduciary Ratings:
https://docs.vis.com.pk/Methodologies%202024/Broker-Fiduciary-Rating.pdf
VIS Rating Scale
https://docs.vis.com.pk/docs/VISRatingScales.pdf