The Pakistan Credit Rating Agency Limited
Press Release
a

Rating Action
Lahore: (09-January-2006)
    PACRA Maintains The Ratings of First International Investment Bank Limited
 

 
Analyst
Muhammad Usman
(+92-42-586 9504)
musman@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 maintained the long-term and short-term entity ratings of First International Investment Bank Limited (Interbank) at ‘A’ and ‘A1’ respectively. These ratings indicate a low expectation of credit risk and a strong capacity for timely payment of financial commitments.

The ratings reflect the bank’s sustained strong risk absorption capacity, which is primarily an outcome of its conservative stance towards risk supported by an effective credit risk management system. However, at the same time, the bank, due to relatively fine pricing, to ensure good credit quality, and high cost structure, continues to experience subdued profitability. The management, to overcome this impediment and being cognizant of the changing operating environment in the fund-based business, has identified fee-based investment banking activities as main revenue drivers. However, as most of these initiatives are at initial stage, the ability to operationalize the strategy into stable revenue streams and the timing and extent of contribution to the bottom line remains to be seen.

About the bank: First International Investment Bank Limited (Interbank), incorporated in 1990, is a joint venture of the Packages Group (PG), American Express Bank N.Y. (Amex) and International Finance Corporation, who collectively hold majority of the bank’s equity. Interbank, listed on Karachi and Lahore Stock Exchanges, provides services in five cities with the head office at Karachi. In order to increase the business volume, particularly from the brokerage operations, the bank has recently started its operations in Faisalabad and Sialkot and, going forward, any further expansion would be on selective basis.

The board of directors comprises seven members, including four representing PG and two nominees of Amex. The current CEO, who joined the bank in June 2004, has over 20 years of banking and capital markets experience in various senior management positions both locally and abroad.

 
 
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.