Pakistan Credit Rating Agency Limited assigns positive outlook to the ratings of First Women Bank Limited

Lahore, June 29, 2015 (PPI-OT):The Pakistan Credit Rating Agency Limited (PACRA) has maintained the long-term and short-term entity ratings of First Women Bank Limited [FWBL] at “BBB+” (Triple B Plus) and A2 (A two), respectively. Meanwhile, “Positive Outlook” has been assigned to these ratings. These ratings denote a low expectation of credit risk and indicate an adequate capacity for timely payment of financial commitments.

The ratings primarily reflect strong association of FWBL with the Government of Pakistan (GoP) – the major shareholder – demonstrating continued commitment and support. Subsequent to injection of fresh equity of PKR 1bln in FY15, GoP has allocated another PKR 1bln in FY16 budget. Receipt of the same would help the bank in meeting MCR – PKR 3bln.

Lately the bank has shown improvement in performance by achieving profitability; however, consistency of the same remains important. The management’s business strategy entails consolidation in all spheres including deposits, and credit. Given past delinquency trend in loan book, asset quality should remain in focus. The management is cognizant of spread enhancement focus and rationalization of cost structure to support performance. The bank’s capital adequacy remains strong.

Positive outlook on ratings captures expected capital injection, enhancing capitalization level. This is expected to provide impetus to FWBL in improving bottom-line performance. Successful execution of the business strategy, while improving efficacy of the risk management framework to improve asset quality – which is currently suppressed – remains 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

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