Pakistan Credit Rating Agency Limited assigns positive outlook to ratings of IGI Investment Bank Limited

Lahore, January 14, 2015 (PPI-OT): The Pakistan Credit Rating Agency Limited (PACRA) has maintained the long-term and short-term entity ratings of IGI Investment Bank Limited (IGI IBL) at “BBB-” (Triple B Minus) and “A3″ (A Three), respectively. The ratings denote an adequate capacity for timely payment of financial commitments. Meanwhile, “Positive Outlook” has been assigned to these ratings.

The ratings of IGI IBL reflect strong commitment of key sponsor – Packages Group – to support IGI IBL in case the need arises. On a standalone basis business profile of IGI IBL is subdued, an outcome of significant losses of recent years mainly led by non-performing assets and higher operational costs structure. Despite that IGI IBL remained current on its obligations.

This in addition to liquidation of certain assets, was primarily managed through long term interest free loan from sponsor. The ratings have been assigned a positive outlook owing to the evolved clarity
on IGI IBL business strategy. This is primarily geared towards providing a wide range of non-fund based financial services.

This, interalia, include i) brokerage as well as research services through merger of IGI Finex Securities Limited, wholly owned subsidiary of IGI IBL, with and in to the IGI IBL, ii) debt instrument custodian/trustee services, iii) fund mobilization under its relatively established for mutual funds distribution – “Fund Select” platform, iv) corporate advisory and v) wealth management / investment advisory. Given expected sustainability in lately achieved breakeven, IGI IBL risk absorption capacity should hold.

The ratings are dependent on continuous support from the sponsor. Meanwhile, improvement in the business profile of IGI IBL to achieve turnaround in bottom line performance remains critical.

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

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