Press Release

VIS Upgrades Corporate Governance Rating of Pak Kuwait Investment Company (Private) Limited

Karachi, December 28, 2021: VIS Credit Rating Company Limited (VIS) has upgraded Corporate Governance Rating of the Pak Kuwait Investment Company (Private) Limited (PKIC) from CGR 9 to CGR-9+. This rating reflects a ‘very high level of Governance’. Previous rating action was announced on December 28, 2020.

Corporate governance ratings are based on evaluation of key governance areas of the rated institution including regulatory compliance; ownership structure; composition and operations of the Board of directors (BoD) and executive management; self-regulation; financial transparency and relationship with stakeholders. The assigned rating takes into account a well-established corporate governance framework incorporated at PKIC in the context of the Joint Venture (JV) agreement between the two sovereign sponsors- Government of Pakistan and Government of Kuwait. The terms of the JV agreement dictate the Board composition where each sponsor nominates three directors on the Board.

Upgrade in governance rating incorporate an enhanced governance framework at PKIC supplemented by effective functioning of board and management level committees. Active oversight by the board was ensured through comprehensive meetings held by the Board of Directors. In the ongoing year, some changes at the Board level were noted with replacement of two board members from Kuwait Investment Authority, the investment arm of Government of Kuwait. . In addition, post term expiry of one of the GoP nominee directors, the position at present remains vacant and the board consists of 5 members with the position to be filled in by the GoP nomination in due course. Structure of the Board and Board Committees is well aligned with the corporate governance code. Third party evaluation of Board was conducted which assessed performance of the Board on the higher end of the scale. Overall attendance record of all Committee meetings was satisfactory with comprehensive discussions regarding various aspects of the Company. Level of financial and qualitative disclosures in the public domain is satisfactory. The Board remuneration policy is in line with the corporate governance guidelines. The ratings draw comfort from the stability in the management team, comprising seasoned professionals, and well-defined structured succession plan in place.

Comprehensive risk management practices, sound systems for monitoring and controlling exposures are in place. The ratings also factor in management’s concerted efforts to update and revise policies pertaining to several cadres of risk incorporating best practices to further strengthen the risk and control framework. The Company also sought external validation of varying risk-based models. Significant emphasis is placed on green banking initiatives to promote and implement environmental compliance. Lately, the Company has been pursuing strong growth in its advances portfolio in a bid to increase the proportion of core income. On the overall corporate governance front, PKIC has taken advanced level measures to adhere to the best governance practices and remains compliant with the provisions of the code.

For further information on this rating announcement, please contact the undersigned (Ext: 204) or Ms. Sara Ahmed (Ext: 207) at 021-35311861-70.


Faryal Ahmad Faheem
Deputy CEO

Applicable rating criterion: Corporate Governance Rating (Aug 2017)

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