The Pakistan Credit Rating Agency (Pacra) has maintained the long-term and short-term entity ratings of Trust Leasing and Investment Bank at AA- (Double A Minus) and Al+ (A One Plus) respectively. The rating of each of the three issued secured Term Finance Certificates (TFC) has been maintained at AA (Double A).
The proposed TFC issue of Rs 500 million has also been assigned a rating of AA (Double A). These ratings denote a very low expectation of credit risk emanating from a very strong capacity for timely payment of financial commitments.
The ratings reflect the bank's strong capital structure supported by an adequate level of profitability. At the same time, the ratings recognise the strategy of the new management to diversify the scope of bank's operations with emphasis on developing fee based revenue streams.
The management is working in a structured manner to build the requisite human and infrastructure base. Although these initiatives, having cost implications, would dampen the bank's profitability in the initial phase, these are expected to help the bank sustain the intensifying competitive pressures.
Meanwhile, though the bank has experienced higher incidence of impairment in its loan book, the prudent collateralisation policy is likely to provide cushion against any material loss.-PR