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Lahore, January 14, 2016 (PPI-OT): The Pakistan Credit Rating Agency Limited (PACRA) has maintained the long-term and short-term entity ratings of ORIX Leasing Pakistan Limited (ORIX) at “AA+” (Double A plus) and “A1+” (A one plus), respectively. The ratings denote a very low expectation of credit risk emanating from a very strong capacity for timely payment of financial commitments. The ratings remain under Rating Watch.
Recently ORIX has entered into an Amalgamation Agreement and Share and Certificate Purchase Agreement with Standard Chartered Bank Pakistan Limited (SCBPL). As per the agreement, Standard Chartered Leasing (86% owned by SCBPL) will merge with and into ORIX. Moreover, ORIX will be acquiring SCBPL’s 20% stake (direct and indirect) in Standard Chartered Modaraba and 100% stake in the Modaraba Management Company – Standard Chartered Services of Pakistan (Private) Limited. The transaction remains subject to satisfaction of various conditions including regulatory approvals contained in the agreements; pending finalization, the ratings of ORIX would remain on Rating Watch.
The ratings of ORIX reflect its leading market position in leasing industry, emanating from robust operational outreach, diversified financing book, effective risk management and dynamic technology infrastructure. The company’s strong business profile is supplemented by a healthy asset base and sound asset quality. The company continues to focus on volumetric growth while closely managing its spreads, in turn generating better profitability.
Demonstrated commitment of ORIX Corporation-Japan remains a key rating factor. The ratings are dependent on the company’s ability to sustain its risk profile. Successful execution of acquisition and merger transaction is important, particularly managing integration challenges.
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