Rating Relationship

At PACRA, we evaluate risk. PACRA assigns credit ratings - an independent, professional and impartial assessment of the risks associated - to both issuer and issues, and strives to maintain comparability of ratings across sectors and over time. PACRA defines itself in a single world - integrity – the core element of its credibility. Rigorous analysis, in-depth knowledge and a holistic approach are at the core of activities undertaken by PACRA. These ratings facilitate investors in making prudent investment decisions. However, regardless of the type of rating, it 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.
Being Pakistan’s premier rating agency, PACRA carries the onus of leadership. We are proud of our contribution in introducing the concept of credit ratings. PACRA is poised to uphold its heritage and endeavors to play a pivotal role in promoting industry best practices, facilitating market knowledge and development of financial markets in Pakistan. PACRA value relationship with all the stakeholders. Communication is the key to enriching professional relationships and our processes. The emphasis PACRA place on interaction has enabled us to communicate effectively and, consequently, to continuously improve upon the quality of our work. We encourage feedback.

Rating Process


Credit rating is an interactive process relying primarily on information and interaction with the rater. It is supplemented with information obtained from outside independent sources. The entire process is aimed at evaluating financial strength of an entity to timely meet its financial obligations. PACRA follows a rigorous, objective and structured rating process at the onset of rating relationship to arrive at a rating opinion. The rating process, subscribes to rigorous quality standards. PACRA has developed comprehensive methodologies for different segments of entities – Banks, NBFCs, Insurance, AMCs, Corporate. We evaluate and analyze both qualitative and quantitative aspects and captures factors affecting the entity in the short-term and long-term. Our analyses broadly focus on ownership and governance structure of the organization, its management and control environment and evaluation of business and financial risks.

Rating Mandate

The rating process begins at the signing of the mandate letter. Mandate letter is a contractual agreement between the entity to be rated and PACRA to undertake a credit rating assignment. These mandates explain all the terms and conditions governing the rating relationship. For new rating relationships, the relationship initiates with a rating request from the entity / the issuer or both.

Rating Practices


Rating relationship is governed by various rating policies covering all aspects rating process whether its confidentiality, surveillance, rating review appeal, relationship suspension or withdrawal.

Fee Structure


While being fair in arriving at a rating opinion, is core to our heart, PACRA attempts to maintain relative fairness in its fee structure as well. In an attempt to further this effort, we maintain the fee structure on our website. We resist significant variations from stated fees and discounts usually are guided by quantum of multiple services to a particular client and fees finalized with other clients around that time.


Ratings remain under surveillance at all times. It is an on-going and a continuous process in line with best practices. PACRA conducts surveillance in two forms i.e., ongoing surveillance and formal annual update. Once rating is accepted, the surveillance period starts immediately.

Usage and Limitations of Credit Ratings


PACRA evaluates the capacity and willingness of an entity to honor its obligations. Ratings issued by PACRA have certain usage and limitations.