PACRA Maintains Entity Ratings of Allied Bank Limited

The ratings reflect sustained risk profile of Allied Bank Limited (ABL). This emanates from a sound equity base and robust liquidity profile. The bank has improved its equity base over the years. The bank continues to hold its position among the largest banks of the country in terms of deposits and advances. The bank remains focused on increasing its footprint in the market with consistent increase in number of branches / ATMs. The strengthening retail deposit market would enable further improvement in deposit granularity in terms of concentration as well as funding cost. The ratings recognize the management's concerted efforts in sustaining the sound asset quality, while expanding its advances portfolio. The concentration in lending portfolio is in line with bank's strategy of lending to large sized financially strong private groups and public sector entities.

Continuation of enhanced diversification in its revenue stream, higher penetration in retail deposits and continuous improvement in cost structure remain crucial for Bank's ratings.

About the Entity
ABL is a large sized Bank with a system share of ~7% as at end-Sep17 in the total deposits of the industry. Ibrahim Group (IG), through Ibrahim Holdings Pvt. Limited, owns 84% of shareholding in ABL. Apart from interest in financial sector; IG is engaged in manufacturing of yarn and polyester staple fiber. ABL has a growing subsidiary - ABL Asset Management Company (sustained 6.8% share in AUM's of industry at end-Sep17). The eight members BoD include the CEO, three sponsoring directors, two independent directors and two non-executive directors. Mr. Tahir Hassan Qureshi, associated with ABL for the last nine years, has been designated as the CEO since Jan-17. He has previously been serving as the Chief Operating Officer and Chief Financial Officer of the Bank. He is supported by a management team of experienced executives.