PACRA UPGRADES LONG-TERM ENTITY RATING OF

PAKISTAN INDUSTRIAL CREDIT & INVESTMENT CORPORATION (PICIC)

 

Lahore: July 14, 2004

The Pakistan Credit Rating Agency (PACRA) has upgraded the long-term rating of Pakistan Industrial Credit & Investment Corporation (PICIC) to ‘AA' (Double A) while the short-term rating has been maintained at ‘A1+' (A one plus). These ratings denote a very strong capacity for timely payment of financial commitments and are applicable to the senior unsecured creditors of the Corporation.

PICIC's ratings reflect potential benefits arising from the diversification strategy to increase its income from stable and sustainable sources. A sizeable contribution to income, in the medium term, is expected from capital market operations and the settlement of chronic default cases. The ratings also recognize that although income from capital market activity will remain vulnerable to volatility risk emanating from fluctuations in the stock market, PICIC has instituted appropriate, pre-emptive risk management policies that effectively contain its market risk. The ratings are further backed by the continuing enhancement in the risk absorption capacity reflected in the expanding equity base of the Corporation, and the expected satisfactory settlement of delinquent loans.