The Pakistan Credit Rating Agency Limited
14-Jul-20
Analyst
Raniya Tanawar
raniya.tanawar@pacra.com
+92-42-35869504
www.pacra.com
Applicable Criteria
- PACRA_Methodology_FI | Jun-19
- PACRA_Methodology_DI Basel III_FY19 | Jun-19
- Criteria | Rating Modifier | Jun-19
Related Research
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Bank Alfalah Limited redeems TFC V of PKR 5bln | Rating Withdrawn
| Issuer | Bank Alfalah Limited |
| Instrument | TFC-V |
| Amount | PKR 5000 mln |
| Issuance Date | 05-Feb-13 |
| Tenor | 8 Years |
| Redemption Date | 18-May-20 |
| Outstanding Amount | - |
| Rating Type | Debt Instrument | |
|
Current (14-Jul-20 ) |
Previous (28-Dec-19 ) |
|
| Action | Redeem | Maintain |
| Long Term | - | AA |
| Short Term | - | - |
| Outlook | Stable | |
| Rating Watch | - | - |
Bank Alfalah Limited issued an Unsecured, Subordinated and Listed Term Finance Certificates (“TFC V | Feb-13 ”) of an amount upto PKR 5bln. The instrument had a tenor of 8 years and carried a profit rate of 6MK + 125bps. The funds raised were to be utilized in BAFL’s business operations. The institution exercised its call option in full during the last quarter of year 2020 and was fully redeemed on 18th May'20.
Subsequent to the completion of the redemption process, the Pakistan Credit Rating Agency (PACRA) has withdrawn the rating of Bank Alfalah Limited | TFC V | Feb-13.
About
the Entity
Bank Alfalah Limited (BAFL) has a network of 698 branches, at end-Dec19, across more than 200 cities in the country. Main sponsor Abu Dhabi Group (ADG), comprises some of the prominent members of UAE's ruling family and leading businessmen of UAE, continues to own majority stake (~49.03% at end-Dec19) in the bank.
At present, BAFL's BoD comprises eight members including President & CEO and seven Non-Executive Directors, of which four of whom are representatives of ADG, one represents IFC, while two are independent. Mr. Atif Bajwa has recently joined the Bank’s board as the President & CEO of the bank. He carries extensive international career experience spanning 37 years of executive leadership roles in banking.
About
the Instrument
Subordinated loan (TFC V Unsecured) with an issue size of PKR 5 bln was issued in Feb13. Tenor of the instrument is eight years (Feb21) with a profit rate of 6M-KIBOR plus 125bps, payable semi-annually. 0.30% of the principal will be repaid in the first 90 months and remaining principal of 99.70% at maturity in the 96th month.