Lahore, June 27, 2019 (PPI-OT): The ratings of Habib Metropolitan Bank (HabibMetro) is vested in the brand strength of the Bank, flanked by a family of astute bankers. The Bank is also associated with a diversified and financially strong international bank – Habib Bank AG Zurich (HBZ). This association helps in assimilating the parent’s best practices into HabibMetro, while fostering control environment with enhanced level of oversight. The Bank has a strong forte in the business hub of Pakistan in terms of its presence and contribution of deposits and advances. The Bank had infection ratio as an issue, the net accretion of which has halted.
To hold asset quality is crucial in the future. Deposit growth, indeed CA and SA, is a challenge. The Bank grew its deposit base, wherein it enhanced its Saving and Time deposit. The CAR of the Bank has taken a hit due to mark-to-market of its investment book. The Bank has a sizable revaluation gain available on account of properties, which may be recognized to boost the Capital base. Issuance of Tier I/ Tier II bond is another option, should the management decide to avail it. The profitability in the recent period is higher, providing internal generation of Capital.
The ratings are dependent on the management’s ability to augment its position generally in the banking industry and particularly in its market niche – trade finance in the wake of rising competition. Any weakening in asset quality will in turn put pressure on the bank’s profitability and risk absorption capacity.
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