PACRA Withdraws the Rating of Bank AL Habib Limited | Tier-II TFC (TFC-VII)

Bank AL Habib Limited (BAHL) issued a rated, unlisted, unsecured and subordinated TFC-VII in Dec-18 of PKR 4bln to contribute towards AL Habib's Tier II Capital. The funds so raised were utilized in the Bank's normal business operations. The tenor of the instrument was 10 years and callable on or after five years with prior approval of SBP. The profit rate was 6MK+100bps and was paid semiannually in arrears on the outstanding principal amount. The instrument was unsecured and subordinated as to payment of principal and profit to other indebtedness of the Bank, including deposits but would rank pari passu with other Tier II instruments and superior to Additional Tier I instruments and common shares. On April 03, 2024, the bank made a public notice to exercise the Call Option in full in respect of the TFC issue. Under the notice, for the Call Option, the Option redemption date was June 06, 2024, on which the bank redeemed in full the entire principal outstanding amount of PKR 3.992bln along with the profit payment of PKR 450.872mln.
Subsequent to the redemption of the Term Finance Certificate, the Pakistan Credit Rating Agency (PACRA) has withdrawn the rating of Bank AL Habib Limited | Tier-II TFC (TFC-VII).

About the Entity
BAHL, incorporated in Oct 1991, operates with a network of 1,113 branches/sub-branches, including 201 Islamic Banking branches at end-Dec23. The sponsors of BAHL are members of the Habib Family – one of the oldest and most distinguished names in Pakistan’s banking sector. BAHL’s nine-member BoD includes representatives of the Habib Family and independent members. Mr. Mansoor Ali Khan, the Bank’s CEO, has been associated with the Bank for more than 28 years. He is backed by a team of experienced professionals, most of whom have a long association with the Bank.