Press Release

VIS Reaffirms Entity Ratings of Pakistan Mortgage Refinance Company Limited

Lahore, April 09, 2024: VIS Credit Rating Company Limited (VIS) has reaffirmed entity ratings of Pakistan Mortgage Refinance Company Limited (PMRC) at ‘AAA/A-1+’ (Triple A/A-One Plus). Outlook on the assigned rating is ‘Stable’. The long-term rating of ‘AAA’ indicates highest credit quality; the risk factors are negligible, being only slightly more than for risk-free Government of Pakistan’s (GoP) debt. The short-term rating of ‘A-1+’ signifies highest certainty of timely payment; Short-term liquidity, including internal operating factors and /or access to alternative sources of funds, is outstanding and safety is just below risk-free GoP’s short term obligations. Previous rating action was announced on April 14, 2023.

PMRC was established by the State Bank of Pakistan (SBP) in 2015 as Pakistan’s first mortgage refinance institution for provision of long-term funding to both conventional and Islamic Primary Mortgage Lenders. The Business Commencement Certificate was granted by SBP to PMRC in June 2018. The ratings are underpinned by the Company’s significant public sector shareholding coupled with strong government and regulatory support. The ratings also take into account the satisfactory policy framework, seasoned management team and robust risk management controls.

In the backdrop of the ongoing macroeconomic deterioration and suspension of previous housing initiatives, mortgage activity has witnessed a decline over the rating review period. While this is reflected in the limited growth in advances during CY23, the associated credit risk is considered minimal on account of sound portfolio quality indicators through strong risk management controls; maintenance of the same will be an important rating factor, going forward. Nonetheless, profitability metrics depicted an uptick owing to both business expansion and higher spreads. Spreads elevated on account of enhanced yield on interest bearing assets – investment and advances – given an increasing interest rate environment. The liquidity profile remains sound due to sizeable liquid assets relative to borrowings. Moreover, exposure to market risk is also on the lower side as government securities comprise majority of the investment portfolio. Furthermore, capitalization indicators continue to be strong on the back of sizeable internal profit generation with the Capital Adequacy Ratio (CAR) expected to remain significantly above the regulatory requirement.

For further information on this ratings announcement, please contact at 042-35723411-13 or email at

Applicable Rating Criteria: Government Supported Entities

VIS Issue/Issuer Rating Scale

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 2024 VIS Credit Rating Company Limited . All rights reserved. Contents may be used by news media with credit to VIS .