Press Release

JCR-VIS Revises Entity Ratings of Rozgar Microfinance Bank Limited to BB/B from BB+/A-3

Karachi, March 6, 2009: JCR-VIS Credit Rating Company Limited (JCR-VIS) has revised the entity ratings of Rozgar Microfinance Bank Limited from ’BB+/A-3’ (Double B Plus / A Three) to ’BB/B’ (Double B / Single B). Ratings continue to be under ‘Rating Watch-Developing’ status.

RMBL is licensed to provide microfinance to the poor in the district of Karachi. The economic and political turmoil during the last year resulted in high delinquencies in the microfinance sector. Increased inflation has also affected the repayment capacity of the clients, with stress likely to persist in the current year.

The bank witnessed considerable increase in non-performing loans (NPLs) resulting in increased provisioning requirements, while disbursements slowed down. Losses accumulated thus far have also resulted in considerable erosion of capital and used up liquid reserves available. The bank was unable to meet the Minimum Capital Requirement (MCR) of Rs. 100m (net of accumulated losses) by December 31, 2008. JCR-VIS Credit Rating Co Ltd. believes that the bank’s performance thus far has also been adversely affected by turnover at the senior level, with the resignation of five CEOs since inception and the post being currently vacant.

JCR-VIS will closely watch these trends for future improvement. Ratings may be revisited following conclusion of the annual surveillance falling due.

For further information on this rating announcement, please contact the undersigned (Ext: 501) or Mr. Manzoor H. Memon (Ext: 512) at 5311861-70 or fax to 5311873.


Safdar Kazi
Director

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