PACRA Assigns Initial Entity Ratings to AL Habib Exchange Company (Pvt.) Limited

AL Habib Exchange Company (Private) Limited (the “Company”) is engaged in foreign exchange dealing and currency export operations. The Company is a wholly owned subsidiary of Bank AL Habib Limited (BAHL), which provides strong parentage support and comfort to the assigned ratings. An experienced management team, supported by a sound governance framework, further strengthens the Company’s operational profile.
Exchange companies in Pakistan operate under the regulatory oversight of the State Bank of Pakistan (SBP). The sector’s performance is influenced by the prevailing macroeconomic environment, regulatory developments, and external dependencies, including trade and remittance flows, as well as broader geopolitical factors. These dynamics collectively affect the operating environment, risk profile, and profitability of Exchange Companies (ECs). Ongoing regulatory oversight and periodic enhancements to compliance requirements continue to influence operational processes and cost structures. Within this context, the Company maintains a favorable relative position in Pakistan’s currency exchange sector, supported by its association with Bank AL Habib Limited (BAHL), established operations, and steady transaction volumes. The Company follows a risk-conservative approach and maintains its net open foreign exchange position within approved limits, supported by daily monitoring of individual foreign currency holdings and the associated profit and loss positions. Exposure levels are jointly reviewed on a daily basis by the Compliance, Internal Audit, and Operations functions prior to close of business. Currency export transactions are executed strictly within Board-approved limits and in compliance with the regulatory framework prescribed by SBP. The enhancement in per-shipment limits provides greater operational flexibility, facilitates higher transaction volumes, and improves efficiency in liquidity and foreign exchange position management. Furthermore, the Company has forward cover arrangements in place with scheduled banks to hedge foreign exchange exposures arising from its operations. The enhancement in the forward cover limit reflects increasing business volumes and provides additional capacity to mitigate exchange rate volatility. The availability of forward cover strengthens the Company’s risk management framework by supporting earnings stability and limiting downside risks associated with adverse foreign exchange movements.
As of September 2025, AL Habib Exchange reported revenue of PKR 166.04 million from exchange operations, including net revaluation gains, significantly higher than PKR 30.25 million recorded in the same period of 2024. The Company has a paid-up capital of PKR 3 billion, exceeding the minimum regulatory requirement of PKR 1 billion. Additionally, AL Habib Exchange maintains strong liquidity to fulfill both operational and regulatory obligations.
The ratings are dependent on the continued prudent management of operations sustainability and risk averseness, supported by strong leadership and sound governance oversight.

About the Entity
AL Habib Exchange Company (Private) Limited (or the "Company") was incorporated in Pakistan on 24 November 2023 as a private limited company under the Companies Act, 2017. The Company operates with 6 branches and 44 booths. The Company's registered office and principal office are situated at 202, second floor, Finlay House, I.I. Chundrigar Road, Karachi. The Company is a subsidiary of Bank AL Habib Limited (the "Holding Company"), which holds 100% of the Company's shares. The Board comprises Mr. Ashar Husain (Chairman), Mr. Qamber Ali, and Mr. Syed Ali Zia Rizvi, all sponsor-representative directors from BAHL. The senior management team is led by Mr. Syed Furqan (CEO), who reports to the Board of Directors and brings over two decades of professional experience.