PACRA Maintains the Rating of Bank AL Habib Limited | Tier-I | TFC VI | Dec-17

The ratings of Bank AL Habib Limited (BAHL) reflect the Bank’s continued emphasis on sustaining and reinforcing its relative positioning in an increasingly competitive banking landscape. Under strong and consistent leadership, the Bank is executing targeted strategic initiatives to maintain its competitiveness and expand its market presence. BAHL has built a long-standing track record of steady growth, anchored in sound governance, prudent risk management, and a strong customer-centric approach. A distinctive feature of the Bank’s strategy is its unwavering focus on nurturing customer relationships—this remains a key driver of both loyalty and growth. Core strengths in trade finance and foreign remittances continue to contribute meaningfully to revenue diversification and industry positioning. In CY24, foreign trade volumes remained on the higher side, while the Bank’s renewed focus on remittances has borne fruit, improved its market share, and allowed it to maintain a net positive contribution in forex terms. In 9MCY25, the Bank’s deposit base grew to PKR 2.5 trillion (CY’24: PKR 2.2 trillion), pushing its market share to 7.00%, with a CASA ratio of 90.2%. Advances stand at PKR 906.6 billion. However, after a period of stability, non-performing loans remain intact, primarily tied to a few large, concentrated exposures. These are adequately provided for, and management remains optimistic about recoveries. Profit after tax stands at PKR 25.3 billion (CY24': PKR 33.1 billion). BAHL is also expanding its acquisition business and deepening its reach across the broader financial services spectrum to meet evolving customer expectations. Looking ahead, while sector-wide margin compression is likely amid monetary easing, BAHL’s strategic clarity, experienced leadership, and deep-rooted customer relationships position it well to sustain growth and maintain its standing as a stable and trusted institution in Pakistan’s banking sector.
The ratings are dependent on the sustained market positioning of the Bank in all areas of its business leadership, while preserving the asset quality. A strong capital adequacy remains essential.

About the Entity
BAHL, incorporated in Oct 1991, operates with a network of 1,295 branches, including 350 Islamic Banking branches at end-Sep'25. The sponsors of BAHL are members of the Habib Family – one of the oldest and most distinguished names in Pakistan’s banking sector. BAHL’s nine-member BoD includes representatives of the Habib Family and independent members. Mr. Mansoor Ali Khan, the Bank’s CEO, has been associated with the Bank for almost three decades. He is supported by a team of experienced professionals, most of whom have a long association with the Bank.

About the Instrument
BAHL issued an unsecured, unlisted, subordinated, perpetual, rated and non-cumulative TFC-VI in Dec-17 of PKR 7bln to contribute towards AL Habib's Tier I Capital. The funds raised were utilized in the Bank's normal business operations. The instrument is perpetual. The profit rate is 6M-KIBOR plus 150bps and is being paid semi-annually in arrears on the outstanding principal. The instrument is unsecured and subordinated as to payment of principal and profit to all other claims except common shares and is pari passu to other Additional Tier I instruments.