The Pakistan Credit Rating Agency Limited
Press Release
a

Rating Action
Lahore: (25-May-2005)
   

PACRA Maintains Entity Ratings of Muslim Commercial Bank Limited
 

 
Analyst
Shahzad Saleem
(+92-42-586 9504)
shahzad@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 Muslim Commercial Bank Limited (MCB) at “AA” (Double A) and “A1+” (A one plus), respectively. The ratings have been assigned a positive outlook. These ratings are applicable to senior unsecured creditors (depositors) of the bank. The rating of unsecured subordinated TFC issue of PKR 1,600mln has been maintained at “AA-” (Double A Minus). These ratings denote a very low expectation of credit risk emanating from a very strong capacity for timely payment of financial commitments.

The ratings reflect MCB's strong capacity to withstand the competitive banking environment, emanating from its extensive franchise supported by an efficient technology platform. Meanwhile, the bank is further strengthening its human resource base in order to expand effectively in targeted business areas. Although the bank has relatively stressed capitalization compared to most peers, the ratings recognize the improving asset quality having positive impact on the bank's risk absorption capacity.

About the TFC Issue: MCB issued unsecured subordinated TFC during August 2002 for a tenor of 5½ years at a floating rate of latest cut-off yield on 5 year PIB plus 1.50% with a floor of 11.75% and a cap of 15.75%. Major principal redemption will be in three unequal installments commencing from the 54 th month of the issue.

About the bank: A number of distinguished corporate groups, led by Nishat group, jointly own majority stake in MCB since its privatization in 1991. MCB continues to derive substantial benefits from the resourcefulness, financial strength and business acumen of the members of Board of Directors. The President & Chief Executive has extensive banking experience locally and abroad and has been in this position for the last five years. A highly experienced and distinguished team of senior management assists him. MCB currently operates an extensive network of 941 domestic and 5 overseas branches with a leading position in automated banking services. The bank has a market share of above 9% in the total deposits of the scheduled banking system.
 
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.