Pakistan Credit Rating Agency Limited assigns entity ratings to Pak Brunei Investment Company Limited

Lahore, June 04, 2015 (PPI-OT): The Pakistan Credit Rating Agency Limited (PACRA) has assigned a long-term entity rating of ‘AA+’ (Double A plus) and short-term rating of ‘A1+’ (Single A One Plus) to Pak Brunei Investment Company Limited (PBIC). These ratings denote a very low expectation of credit risk and indicate a very strong capacity for timely payment of financial commitments.

Pak Brunei Investment Company Limited is a joint venture, equally owned by Governments of Pakistan and Brunei; sovereign parentage implies strong sponsor support. In the recent past, establishment of an asset management company – Primus Investment Management Limited – has helped diversifying the products on offer by the company.

The company has also set-up a modaraba management company to ensure presence in growing Islamic industry while, launch of its first modaraba is in process. Establishing collateral management and infrastructure development companies is also on the agenda. Build-up of a sizeable revenue stream from these investments may take time.

On stand-alone basis, the ratings incorporate strong profile of PBIC characterized by its sound liquidity, healthy capitalization, good asset quality, and improving profitability. The company has several initiatives in place to diversify its revenue stream and fortify its footprint.

These mainly include SME lending, and advisory based revival financing – mainly to distressed entities. To finance targeted expansion in asset base, the company is likely to rely mainly on its borrowing lines while maintaining deposits base largely at current levels.

The company’s business initiatives alongwith planned investments, are likely to add strength to its profile. However, management of related risk factors is critical to monitor. At the same time, upholding high governance standards and maintaining asset quality would remain important.

For more information, contact:
Hammad Rashid
Analyst
The Pakistan Credit Rating Agency Limited (PACRA)
Awami Complex, FB1, Usman Block New Garden Town,
Lahore – Pakistan
Tel: +9242 586 9504 -6
Fax: +9242 583 0425
Email: hammad.rashid@pacra.com
Web: www.pacra.com