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Pakistan Credit Rating Agency Limited assigns preliminary rating to Proposed privately placed TFC of JS Bank Limited

Lahore, November 17, 2016 (PPI-OT):The rating of unsecured, subordinated, and privately placed TFC is primarily based on long-term rating of JS Bank – the issuer. The rating of JSBL reflects its strengthened position in the country’s competitive banking landscape. This emanates from enhanced system share (approaching 2% of deposits at end-Sep16). The benefit has trickled down whereby concentration – both in deposits and advances – is approaching adequate levels. Expanded branch network is supporting deposit growth. Meanwhile, JS Bank is carefully building its loan book; although asset quality is good.

The strategy is to i) foster penetration of existing branches while expanding the network beyond 300 branches over the near-term; ii) spread advances book through different products over multiple sectors; iii) build non-fund based income; and iv) hold strength in treasury operations. JS Bank has adequate capital level (CAR at end-Sep16: ~12% primarily tier I). However, for credit expansion, the bank is in process of issuing this tier II TFC. Rating is dependent on JS Bank’s ability to maintain its growth trajectory to establish itself in the medium-sized banking space of Pakistan. Meanwhile, upholding asset quality, adding diversity to income streams, and strong governance framework are critical.

For more information, contact:
Analyst
The Pakistan Credit Rating Agency Limited (PACRA)
Awami Complex, FB1, Usman Block New Garden Town,
Lahore – Pakistan
Tel: +9242 586 9504 -6
Fax: +9242 583 0425
Email: hammad.rashid@pacra.com
Web: www.pacra.com

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