Press Release
JCR-VIS reaffirms Entity Ratings of Pak Brunei Investment Company Limited
Karachi, June 30, 2014: JCR-VIS Credit Rating Company Limited (JCR-VIS) has reaffirmed the entity ratings of Pak Brunei Investment Company Limited (PBIC) at ‘AA+/A1+’ (Double A Plus/A-One Plus). Outlook on the assigned ratings is ‘Stable’.
The ratings assigned to PBIC incorporate the sovereign ownership of the company, with Government of Pakistan and Brunei being equal shareholders. Comfort is also drawn from the strong asset quality maintained by the company, which is reflective of the sound risk and control infrastructure in place.
In addition to conventional lending, business model of PBIC advocates revival financing for mid-sized corporate entities that may be undergoing financial stress. SME activities have also picked up pace; however share of the same in the overall advances portfolio is still modest. These initiatives are likely to enable the company to enhance the spreads on financings.
Investment portfolio of the company comprises a sizeable proportion of the balance sheet; size of the same varies with the volume of money market activity over the year. On a timeline basis, price risk associated with the same has increased as the company has changed composition of the portfolio relative to year-end level.
Funding sources of the company primarily comprise borrowings from financial institutions. Notable growth has been witnessed in COIs during the on-going year. Liquidity profile of the institution is considered sound, drawing comfort from the low level of impairment in assets and maturity profile of assets and liabilities (adjusted for repo).
The management team of PBIC has depicted stability; personnel at the senior management level possess the necessary skill set to deliver on the company’s goals, as envisioned in the strategy for the organization. The company had set up an asset management subsidiary in 2011. Future initiatives entail plans to offer Shariah compliant products and services through a Modaraba Management Company and scaling up the services of the advisory group.
For further information on this rating announcement, please contact Mr. Javed Callea (Ext: 501) or Ms. Sobia Maqbool, CFA (Ext: 604) at 021-35311861-70 or fax to 021-35311873.
Abdur Rahim, ACII
Advisor
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