Karachi, March 27, 2020 (PPI-OT): VIS Credit Rating Company Ltd. (VIS) has reaffirmed the Broker Management Rating of BMA Capital Management Limited (BMA) at ‘BMR2+’. Outlook on the assigned rating is ‘Stable’. The previous rating action was announced on January 24, 2019. The rating signifies strong client relationship management and compliance levels, sound internal and external controls, HR and IT services while regulatory framework and financial management are considered adequate.
Reaffirmation of rating factors in BMA’s long-standing experience in securities broking business, existing market position and improvement witnessed in earning profile. Rating also takes note of strong risk management and compliance levels. Presence of independent director (ID) on board enhances board level governance; however, ID with relevant experience would add more value to the board. Formation of Risk Management and HR Committee, as planned by senior management, would further enhance corporate governance. Updating existing policies and a development of full scale conflict of interest policy would strengthen the overall internal control environment. Moreover, downward change in category of existing external auditor has been noted which is not aligned with CGR best practices.
Assessment of financial profile indicates considerable improvement in bottom-line profitability during HFY20. Curtailment of admin expenses and support from other income has contributed positively. Despite revenue base being diversified through brokerage corporate advisory arm; income generated from the same remains limited. Dividend income has witnessed decline on a timeline basis.
For more information, contact:
Director Compliance and Rating Analytics,
VIS Credit Rating Company Limited
VIS House, 128/C, 25th Lane off Khayaban-e-Ittehad,
Phase VII, DHA, Karachi, Pakistan