Press Release

JCR-VIS Reaffirms IFS Rating of UBL Insurers Limited at A-

Karachi, October 20, 2009: JCR-VIS Credit Rating Company Limited has reaffirmed the Insurer Financial Strength rating of UBL Insurers Limited (UIL) at ‘A-’ (Single A Minus). Outlook on the assigned rating is ‘Stable’.

UIL derives strength from the franchise value of United Bank Limited (UBL). Gross premium target for 2008 was met by the company, despite deteriorating economic conditions. Overall claims ratio improved in 2008 on account of improved business diversification and growth resulting in a decline in underwriting loss during the out-going year. However, high level of management expenses continues to undermine profitability indicators. Business levels for the on-going year may be slightly lower as the company curtails its exposure in the motor segment. The rating incorporates the quality of re-insurers on the company’s panel, which is fairly diversified. JCR-VIS will continue to monitor the performance of the company under the guidance of the new CEO.

The investment portfolio at year-end 2008 was carried at higher value than market prices on account of considerable decline in KSE-100 index. In view of the underperformance of investment portfolio, Investment Policy of the company has been revised on a conservative note by limiting exposure against equity market investments.

Losses on account of impairment in investments led to fall in the level of capitalization. Fresh capital injection by the sponsors during the on-going financial year has allowed the company to recoup capitalization levels while also bringing leverage indicators within prudent limits.

For further information on this rating announcement, please contact the undersigned (Ext: 508) or Ms. Sabeen Saleem (Ext: 510) at 021-35311861-70 (10 lines) or fax to 021-35311872-3.



Syed Ziauddin Ahmed
Advisor

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