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The Pakistan Credit Rating Agency Limited
Press Release

Date
28-Jun-19

Analyst
Shahzaib Khalid
shahzaib.khalid@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 Maintains the Entity Ratings of Alfalah Securities Private Limited.

Rating Type Entity
Current
(28-Jun-19)
Previous
(31-Dec-18)
Action Maintain Maintain
Long Term A- A-
Short Term A1 A1
Outlook Stable Developing
Rating Watch - Yes

The Entity Ratings of Alfalah Securities (Pvt) Limited apprehend its emerging position in the country's brokerage industry. In the preceding year, Credit Lyonnais Securities Asia (CLSA) has acquired 24.9% stake in Alfalah Securities (Pvt.) Ltd, followed by Bank Alfalah Limited (~62%). The rating incorporates the company's ability to retain market share in lackluster equity market volumes. The company has sound governance framework and well developed organizational structure. The Internal control environment is considered effective with well-defined policies. Moreover, there will be a change in entity's name to leverage CLSA's strong brand. The rating continues to factor the company's sound risk and compliance function.
Improvement in profitability, continuous monitoring of risk related parameters and retention of key human resource will bode well for the company. Meanwhile, maintaining its competitive position in the industry through diversification and volume based enhancement in revenues is critical for ratings.

About the Entity
Alfalah Securities Private Limited is a financial services company, licensed as securities broker under Securities Brokers (Licensing and Operations) Regulations, 2016. The company is engaged in equity trading. The company also provides investment banking & advisory services. Alfalah Securities operates from Head office based in Karachi, Pakistan. It is a subsidiary of Bank Alfalah Limited. The bank owns ~62% stake in Alfalah Securities. Credit Lyonnais Securities Asia (CLSA) now holds ~24.9% stake in the company. The remaining shareholding lies with the company's Chairman Mr. Aliuddin Ansari and the CEO Mr. Atif M. Khan.
CLSA is a Hong Kong based capital markets and investment group focused on alternative investment, asset management, corporate finance, securities and wealth management for corporate and institutional clients around the world.

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.