The Pakistan Credit Rating Agency Limited
Press Release
a

Rating Action
Lahore: (30-June-2005)
    PACRA Upgrades Ratings of Union Bank Limited (UnBL)
 

 
Analyst
Muhammad Usman Majeed
(+92-42-586 9504)
usman@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 upgraded the long-term and short-term ratings of Union Bank Limited (UnBL) to “AA-” (Double A minus) and “A1+” (A One Plus) respectively. These ratings are applicable to senior unsecured creditors (depositors) of the bank, and denote a very low expectation of credit risk emanating from a very strong capacity for timely payment of financial commitments. The ratings of the unsecured, subordinated TFCs already in issue (first TFC issue of PKR 750mln and second TFC issue of PKR 750mln respectively) also stand revised to “A+” (Single A plus). PACRA assigns a rating of “A+” (Single A plus) to the proposed third unsecured, subordinated TFC issue of PKR 1,000mln. These ratings denote high credit quality emanating from a strong capacity for timely payment of financial commitments.

UnBL's ratings reflect the sustained success of the bank in consolidating its competitive edge in consumer banking while continuing to expand the corporate finance and SME segments. While exposure to consumer banking suggests a relatively high risk appetite, the bank is assiduously ensuring effective risk management through stringent credit evaluation and monitoring supported by a strong I.T. structure and systems. Given its human and physical infrastructure as well as its increasing brand recognition, the bank is well positioned to meet the challenges of the emerging competitive banking environment.

About the bank: UnBL commenced operations in 1991 under the management of a local business group. However, the management changed subsequently in 1999, as the controlling interest in the bank was acquired by a Saudi investor. UnBL has in recent years emerged as one of the fastest growing banks with commensurate strengthening of its performance indicators. The bank has also expanded into the international arena by operating two branches in Sri Lanka.

 
 
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.