Press Release

JCR-VIS assigns AA+/A1+ Ratings To Pak Brunei Investment Company Limited

Karachi, June 29, 2012: JCR-VIS Credit Rating Company Limited has assigned entity ratings of ‘AA+/A1+’ (Double A Plus / A One plus) to Pak Brunei Investment Company Limited (PBIC). Outlook on the assigned ratings is ‘Stable’.

The credit ratings assigned to PBIC take into account the joint venture shareholding structure of the company, equally held by the Government of Pakistan and Brunei. In addition to financial support from the sponsors, equity build up has received support from rising profits, which has been retained. The management team of PBIC comprises well-rounded and qualified professionals.

Business model of the company advocates a diversified set of operations. In addition to conventional lending, PBIC provides advisory and consultancy services and has undertaken strategic investments in economically viable projects. Presence of strong internal controls and risk management infrastructure has ensured sound asset quality. Moreover, in order to augment profitability and create synergies benefits, PBIC has recently set up an investment management subsidiary.

During FY11, asset base of the company increased manifold owing to PBIC’s higher money market participation to take advantage of the arbitrage spread. This is however expected to be reversed in the ongoing year, depending on the direction of interest rates. Advances portfolio largely comprises medium sized enterprises with varying risk profile along with few top-tier names. Government securities represent sizeable proportion of the investment portfolio signifying low credit risk; however there are certain fixed income exposures which are considered high risk.

Going forward, PBIC plans to gradually build its corporate loan book while keeping a cautious check on risk profile of the portfolio. Some exposures are expected to be taken as part of SME and distressed financing, however careful evaluation and enforcement of control is expected to somewhat mitigate the associated risks.

For further information on this rating announcement, please contact the undersigned (Ext: 501) or Ms. Sobia Maqbool, CFA (Ext: 506) at 021-35311861-70 or fax to 021-35311873.



Javed Callea
Advisor

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