Press Release

JCR-VIS reaffirms ratings of National Bank of Pakistan Limited at AAA /A-1+

Karachi, June 30, 2011: JCR-VIS Credit Rating Company Limited (JCR-VIS) has reaffirmed the entity ratings of National Bank of Pakistan (NBP) at ‘AAA/A-1+’ (Triple A / A-One Plus) with ‘Stable’ Outlook.

NBP dominates the commercial banking sector with market share of 14% in total banking sector deposits. The deposit base has exhibited healthy growth and the bank has maintained strong liquidity indicators. In addition to enjoying a large retail deposit base, the bank also holds a major portion of total public sector deposits. NBP also enjoys one of the highest levels of capitalization, among the larger banks.

In view of adverse macroeconomic conditions, an upward trend has been witnessed in infection levels. In addition to accretion of fresh non-performing loans in private sector lending, the bank has also recently classified some of its public sector advances. Even after adjusting for net NPLs, capitalization level is considered strong. Two asset recovery groups have been set up last year to actively pursue the recovery of non-performing assets or achieve settlement through realization of collateral.

Net profit for 2010 was maintained at the preceding year’s level due to contraction in spreads. Improving bottom-line results through reduction in cost of deposits in line with other large banks has been prioritized for the on-going year and ahead. Moreover, NBP is also looking to leverage its international presence to capture higher volumes of trade business.

The pace of revamping the IT infrastructure has accelerated in recent months. Pilot launch of core banking application has been conducted as a move towards centralization of operations, while several other modules are undergoing user acceptance tests. Upgradation of branch connectivity is underway and will steadily be implemented throughout the network.

For further information on this rating announcement, please contact Ms. Sabeen Saleem, CFA (Ext: 510) or Ms. Sobia Maqbool, CFA (Ext: 506) at 35311861-70 or fax to 35311872-3.



Javed Callea
Advisor

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