The Pakistan Credit Rating Agency Limited
Press Release
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Rating Action
Lahore: (26-September-2005)
   

PACRA Assigns ‘BBB’ IFS Rating to East West Insurance Company Limited

 

 
Analyst
Moin Khalid
(+92-42-586 9504)
moin@pacra.com

 

 

 









 

 

 

 

 

 

Disclaimer
This press release is transmitted to you for this sole purpose of dissemination through your newspaper/magazine/agency. The press release may be used by you in full or in part without changing the meaning or context thereof but with due credit to PACRA. However, PACRA has the sole right of distribution of its press releases for consideration or otherwise through any media.

  

The Pakistan Credit Rating Agency (PACRA) has assigned an insurer financial strength (IFS) Rating of ‘BBB’ (Triple B) to East West Insurance Company Limited. The rating has been assigned a positive outlook. The rating denotes good capacity to meet policyholder and contract obligations.

The rating reflects EWI’s satisfactory financial base, high solvency, sound liquidity position and a stable risk profile owing to effective and prudent underwriting practices being followed by management. At the same time, the rating also takes into account the company’s weak profitability, attributable to higher level of operating expenses and modest investment income. However, the prospects for investment income have improved due to revamping of the investment portfolio. The management has also evolved a strategy for strengthening the core performance through curtailing costs and expansion in business volumes.

About the company: EWI commenced commercial operations as a general insurance company in 1983 and is currently listed on the Karachi Stock Exchange. The shareholding in the company is effectively held by Yunus family and all the members of the BoD, including the chief executive, belong to this family. The other major concern owned by the family is the Metropolitan Life Assurance Co. of Pakistan Ltd. The family also had the controlling interest in Mybank Ltd. (previously Bolan Bank Ltd.), which it divested in Mar 04.

The company is writing various classes of general insurance business, and is the pioneer in the field of livestock insurance and recently extended coverage to loans against crops. The company has an extensive network of around 50 branches and agency offices spread across the country.
 
The primary function of PACRA is to evaluate the capacity and willingness of an entity to honor its obligations. Our ratings reflect an independent, professional and impartial assessment of the risks associated with a particular instrument or an entity.

PACRA's comprehensive offerings include instrument and entity credit ratings, insurer financial strength ratings, fund ratings, asset manager ratings and real estate gradings.

PACRA's opinion is not a recommendation to purchase, sell or hold a security, in as much as it does not comment on the security's market price or suitability for a particular investor.

 

    
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