JCR-VIS maintains rating of TFC-1 issue of Escorts Investment Bank Limited

Karachi, March 14, 2013 (PPI-OT): JCR-VIS Credit Rating Company Limited (JCR-VIS) has maintained the rating assigned to TFC-1 issue of Rs. 500 million of Escorts Investment Bank Limited (EIBL) at ‘BB’ (Double B). The “Rating Watch – Developing” status has been removed and Outlook on the assigned rating is “Negative”.

Non-earning assets constitute a sizeable proportion of the balance sheet of EIBL and are partially funded by borrowings. This has resulted in operating losses which have eroded the equity base of the bank. Management embarked upon a restructuring exercise including various cost cutting measures.

Various small ticket business segments have been targeted to build-up a stable revenue stream. Quantum of losses has reduced in recent periods, though risk absorption capacity of the bank now stands considerably weakened. Successful materialization of various initiatives in the form of sustained performance to bring about improvement in the risk profile of the institution is considered important, going forward.

EIBL rescheduled its term finance certificate for 2.5 years during FY12 in view of liquidity constraints faced by the institution. JCR-VIS will continue to track timely repayments against the revised redemption schedule.

For more information, contact:
Mr. Javed Callea
Advisor
JCR-VIS Credit Rating Company Limited
Tel: +9221 35311861 (10 lines) (Ext: 501)
Fax: +9221 35311872-3
E mail: javed.callea@jcrvis.com.pk

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