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The Pakistan Credit Rating Agency Limited
Press Release

Date
23-Jun-17

Analyst
Iqra Bashir
iqra.bashir@pacra.com
+92-42-35869504
www.pacra.com

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This press release is being transmitted for the sole purpose of dissemination through print/electronic media. The press release may be used in full or in part without changing the meaning or context thereof with due credit to PACRA

PACRA Assigns Positive Outlook to IFS Rating of Pak-Qatar Family Takaful Limited

Rating Type IFS
Current
(23-Jun-17)
Previous
(09-Aug-16)
Action Maintain Initial
Long Term A A
Short Term - -
Outlook Positive Stable
Rating Watch - -

The rating reflects sustained market position of the company, having decent foothold in takaful industry. The company has gained momentum in terms of business expansion. The company benefits from its brand as being the dedicated takaful company having significant size. Pak Qatar family’s financial position has strengthened, given profitability, enabling reversal of Qard e Hasna. Moreover, after having established branch network, PakQatar Family is gradually expanding wings through alternate distribution networks; wherein the success remains to be seen. Meanwhile, competition from window takaful should be managed well. The profitability of the company has remained strong as compared to peers, reflecting strong business profile. The financial risk profile has been strengthened based on fresh injection (Rs. 248.7mln). Pak Qatar Family Takaful has strong liquidity coverage to policyholder’s liabilities, which is further topped up by a cushion from liquid investments of the shareholder’s fund.

The ‘positive outlook’ captures the company's ability to improve its market share while improving the persistency of Gross Contribution. Product diversification in non-banca segments should be translated into sizeable volumes with enhanced profitability.


About the Entity
PakQatar Family, commencing operations in 2007 as unlisted public company, has a market share of 4.8% at end Sep16 (including Public Sector). It operates through a network of 45 branches, and has tripartite bancatakaful arrangements with each of the 10 banks and FWU AG. The shareholding of the company is held by (i) Pak Qatar Investment (Pvt.) Limited (38%), (ii) Three Qatar based Financial Institutions (36%), (iii) H.E Shiekh Ali bin Abdullah Al-Thani (6%) - member of Qatar's Royal Family, and (iv) FWU AG (15%). Among the main sponsors of the company, Mr. Said Gul is a Pakistani origin businessman settled in Qatar; he has main interest in construction business. Mr. Said Gul and H.E Al-Thani also own majority stake in Pak Qatar General Takaful.
PakQatar Family has a seven-member board including the Managing Director - Mr. Said Gul. Mr. Gul has been associated with the company since inception. H.E. Sheikh Ali Bin Abdullah Al-Thani (H.E. Ali), royal family member, is chairman of the board, while Qatar based Financial Institutions and FWU-AG each have one nominee director, respectively, while Mr. Said Gul represents himself through Pak Qatar Investment (Private) Limited. Mr. Nasir Ali Syed; CEO of the company since 2012, carries more than two decades of experience in life insurance industry.

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 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.