PACRA Upgrades the Entity Ratings of Askari Bank Limited

The upgrade in the ratings of Askari Bank (the "Bank") is characterized by sustained financial performance, robust capitalization and strengthened balance sheet complemented by strategic support from its ownership structure: Fauji Foundation (FF) is the ultimate parent and, more importantly, exercises direct control over the Bank pursuant to the related agreement executed between FF and Fauji Fertilizer Company. FF is a growth driven ‘Social Hybrid Enterprise’ which earns to serve its beneficiaries. It is the largest social entity in Pakistan having a strategically diversified portfolio of companies in Fertilizer, Cement, Food, Power Generation (Thermal and Renewable), Oil & Gas Exploration, LPG marketing & distribution, Marine Terminals, Financial Services (Bank and Financial Brokerage), Aviation and Employment Services. With this inbuilt diversity, FF commands a very strong market capitalization across its spectrum of companies. This association provides the Bank with key strategic advantages, including enhanced market reach, stronger customer confidence, and access to a stable and diversified deposit base. Beginning FY27, FF has announced multiple acquisitions, most notably Askari General Insurance and Askari Life Insurance, while a few other ventures are also in the pipeline. These initiatives are expected to further augment AKBL's presence across the country's financial spectrum, reinforcing its strategic positioning and unlocking an array of cross-sell opportunities.
Under the new leadership, the Bank has adopted a more growth-oriented strategy with increased focus on improving service quality, deepening customer relationships and expanding its market presence. During 2025, Askari Bank delivered strong financial performance, demonstrating resilience and disciplined execution in a challenging operating environment characterized by compressed interest margins. The Bank’s results are supported by its solid franchise and a sustained emphasis on low-cost deposit mobilization. The expanding outreach, supported by digital onboarding and transaction banking initiatives, is further strengthening its deposit franchise. The Bank’s mobile banking platform, with more than one million users, offers a range of digital services including digital onboarding, cardless cash withdrawals, AI-enabled advisory features, and enhanced customer engagement tools. In addition, the Bank introduced an industry-first, In-app calling feature during the year, to enhance customer security. During 2025, AKBL’s Profit before tax increased by 19.7% to PKR 53.3bln (CY24: PKR 44.5bln), while net profit rose to PKR 22.8bln (CY24: PKR 21.0bln), with growth partially offset by a higher effective tax charge. Shareholders’ equity expanded by 24.8% to PKR 151.7bln (CY24: PKR 121.6bln). Total assets grew by 15.9% to PKR 2,895.0bln (CY24: PKR 2,498.4bln). Current accounts grew by 29 percent, reflecting improved deposit mobilization and a stable funding profile. The Bank maintained a strong capital position, with a Capital Adequacy Ratio (CAR) of 21.59% (CY24: 21.40%), providing an ample buffer to support future growth and absorb potential shocks. Going forward, the Bank intends to strengthen its footprint in the digital space, network presence, trade business, and cross-sell.
The Bank is committed to maintain capital ratios well above prescribed thresholds for better risk absorption capacity. The ratings depend on the Bank's ability to maintain its competitive position. Going forward, prudent management of funding costs is crucial, and maintaining asset quality remains essential.

About the Entity
Askari Bank Limited was incorporated in 1991. The Fauji Consortium is the key sponsor, holding a 71.91% stake in the Bank, while the remaining 28.09% shareholding is widely held by financial institutions and the general public. Currently, overall control of the Bank vests in the eleven-member Board of Directors (BoD), including the President and CEO. Four of the board members are Fauji Foundation nominees; four are independent members, while one represents National Investment Trust Limited (NITL). Mr. Zia Ijaz is the President and CEO of the Bank. He is a Fellow Chartered Accountant (FCA) and a member of ICAP Pakistan, with extensive experience across leading commercial banks in Pakistan and abroad.