JCR-VIS finalizes rating of Basel 3 compliant Additional Tier 1 Sukuk by Dubai Islamic Bank Pakistan Limited

Karachi, January 09, 2019 (PPI-OT): Upon review of final signed legal documents, JCR-VIS Credit Rating Company Limited (JCR-VIS) has assigned finalized rating of ‘A’ (Single A) to Dubai Islamic Bank Pakistan Limited’s (DIBPL) proposed Basel 3 compliant Additional Tier-1 Sukuk. Outlook on the assigned rating is ‘Stable’.

DIBPL has issued privately placed/ OTC Listed, perpetual, unsecured, subordinated, non-cumulative and contingent convertible Shariah compliant Sukuk amounting up to Rs. 3.12b. The issue proceeds will contribute towards the bank’s Additional Tier-1 (ADT-1) capital and will be utilized towards enhancement of the bank’s business operations. DIBPL’s ADT-1 instrument will rank ahead of claims of ordinary shareholders but below the bank’s senior creditors, including depositors. Ratings also reflect relative risk of the ADT-1 instrument including profit servicing from only earnings for the year, conversion feature in the event of pre-specified trigger events, lock-in clause and point of non-viability in terms of regulatory requirements.

JCR-VIS has assigned entity ratings of AA-/A-1+ (Double A Minus/A-One Plus) to DIBPL indicating high credit quality. The assigned ratings reflect the Bank’s sound asset quality indicators, strong and consistent profitability growth over the last three years and adequate liquidity and capitalization indicators. Ratings assigned to DIBPL incorporate sound profile of the sponsor, Dubai Islamic Bank (DIB), the largest Islamic bank operating in United Arab Emirates. DIB has been rated ‘A/A-1’ (Single A/A-One) on the international scale. Support from the parent has been witnessed in the past and JCR-VIS expects this support to continue going forward.

For more information, contact:
Director Compliance and Rating Analytics,
JCR-VIS Credit Rating Company Limited
VIS House, 128/C, 25th Lane off Khayaban-e-Ittehad,
Phase VII, DHA, Karachi, Pakistan
Tel: +92-21-35311861-72
Fax: +92-21-35311873
Email: bilal@jcrvis.com.pk
Website: http://jcrvis.com.pk/