PACRA Maintains the Entity Ratings of BankIslami Pakistan Limited.

BankIslami Pakistan Limited (BIPL), the first Islamic commercial bank to receive an Islamic banking license in Pakistan, has demonstrated notable growth in recent years across key areas relevant to the risk profile of a commercial bank. In CY23, the Bank underwent a significant ownership transition when JS Bank Limited—one of its sponsor shareholders—increased its stake to 75.12%, becoming the majority shareholder and Parent Company, thereby making BIPL an integral part of the JS Group.
Post this development, the Bank has shown improved operational and financial performance. With the strategic backing of the JS Group, BIPL has been able to leverage synergies to enhance its product offerings, improve operational efficiency, and expand its market outreach. The integration has also enabled a stronger focus on innovation, customer service, and sustainable growth, further solidifying the Bank’s position in Pakistan’s Islamic banking sector.
Recently, the Bank has launched its digital mobile application, branded as 'AIK', offering a comprehensive suite of financial services that closely mirror the functionality of the Parent Bank's app, 'Zindigi'. As of May'25, the Bank has mobilized PKR 2.1mln deposits through its app, indicating initial traction in the digital space. Furthermore, the BIPL is set to transition its core banking system from "iMal" to "Temenos (T-24)" in the near future to align with evolving industry standards and technological advancements. During CY24, the Bank grew its branch network from 440 to 540 branches, primarily in Punjab, aiming to tap high-potential markets and boost customer access in a key economic hub.
As of CY24, the deposit base grew by 7% to stand at PKR 559bln (CY23: PKR 523bln) with a large contribution from current and term deposits. The Bank’s focus on sticky deposits underscores its intent to reduce reliance on volatile sources and build a more sustainable funding profile. BIPL's net advances have increased by 28% to stand at PKR 296bln (CY23: PKR 230bln) with the decline in infection ratio to 7.4% (CY23: 9%), reflective of sustained asset quality. At the end of CY24, BIPL’s investment portfolio grew to PKR 345bln (CY23: PKR 314bln), mainly due to increased exposure to GoP Ijara Sukuk, which rose to PKR 311bln (CY23: PKR 278bln). During CY24, the profit after taxation largely remained the same to stand at PKR 11.8bln (CY23: PKR 11bln), attributable to enhanced net interest margin which witnessed an increase to stand at PKR 46.4bln (CY23: PKR 40.2bln). Whereas, the Bank’s operating expenses registered a significant increase of 37%, primarily attributed to the ongoing branch network expansion. The equity base, in turn, the risk absorption capacity of the Bank has recorded commendable improvement. In the future, it will be crucial to carry out the Bank’s business plan while enhancing the effectiveness of the risk management framework to raise asset quality. As of CY24, the CAR of the Bank was enhanced to 24.1% (CY23: 23.8%), indicating a sufficient growth cushion for the Bank. Going forward, as per the business plan, areas under focus include growth in deposit base, growth in trade business, creation of customer centricity, reinforcing risk management and compliance frameworks, branch expansion, and increasing digital footprint through revamped digital delivery channels.
The rating incorporates the Bank's ability to strengthen its market position in its peers with improved risk management. The Bank is expected to absorb the impact of the transition in the cost of funding and hold on to its profit margin.

About the Entity
BIPL commenced operations in Apr-06 and is listed on PSX. BIPL is a subsidiary (75.12%) of JS Bank Limited. Mr. Ali Hussain holds 12.53% of the stake while the remaining stake is widely spread among general public. BIPL’s eight-member board of directors including the CEO constitutes representatives of sponsoring groups and independent directors. Mr. Suleman Lalani, Group President of Jahangir Siddiqui & Co. Limited, is serving as the Chairperson of the Board. Mr. Rizwan Ata, a seasoned banker, is serving as CEO. A team of competent professionals assist the CEO.