Press Release

JCR-VIS Reaffirms Entity Ratings of United Bank Limited at AA+/A-1+

Karachi, June 22, 2009: JCR-VIS Credit Rating Company Limited (JCR-VIS) has reaffirmed the entity ratings of United Bank Limited (UBL) at ‘AA+/A-1+’ (Double A Plus / A-One Plus). Ratings of the four outstanding subordinated debt instruments, TFC-1, TFC-2, TFC-3 and TFC-4, issued by the bank have also been reaffirmed at ‘AA’ (Double A). Outlook on the assigned ratings is ‘Stable’.

UBL is positioned as one of the largest bank in the country, enjoying almost 10% share of the domestic deposit base. Fuelled mainly by deposits, growth in the banking book over the last few years has been driven by the corporate segment although the bank has also been a major player in the consumer market.

The year 2008 presented a diverse range of challenges for the banking sector, impacting asset quality, profitability and liquidity indicators. UBL has not been completely insulated from deteriorating fundamentals in the macroeconomic environment, including those pertaining to the global markets, with almost one-fourth of the banking book deployed overseas.

The bank’s outlook in respect of overseas operations has remained aggressive; with support requirements having arisen during the last few months on account of financial stress in foreign markets. While the bank has so far remained resilient in the face of these pressures, presence in the overseas market magnifies total risk of the bank, on account of added dimension of foreign exchange risk.

On the domestic front, asset quality indicators have been impacted in particular within the consumer portfolio. Going forward, growth in the consumer segment will be selective while the impact of further tightening in underwriting standards will be tracked over the ensuing quarters.

On a consolidated basis, UBL has continued to enjoy healthy spreads on its banking book although pricing pressure on deposits has translated into an increase in cost of funds. Capitalization indicators of the bank have also been persistently strong over the years. While efforts at improving risk management infrastructure have been ongoing, a challenging operating environment will continue to test the resilience of industry participants, at-least over the near to medium term.

For further information on this rating announcement, please contact Ms. Sabeen Saleem (Ext: 510) or Ms. Sobia Maqbool (Ext: 506) at 5311861-70 or fax to 5311872-3.



Faheem Ahmad
President & CEO

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 2009 VIS Credit Rating Company Limited . All rights reserved. Contents may be used by news media with credit to VIS .