December 28, 2018 (MLN): Pakistan Credit Rating Agency (PACRA) has maintained debt instrument rating of The Bank of Punjab TFC-I at ‘AA-‘, with a ‘stable’ outlook forecast.
As per the rating agency, the ratings reflect improved risk profile of Bank of Punjab (BoP) with an appreciable enhancement in profitability and asset quality over the last few years which supplemented the equity base.
During the current year, the bank has recorded commendable uptick in revenue base – both interest earned and income from fee, commission. Hence, an uptick witnessed in asset yield.
During 9MCY18, the bank recorded sizable improvement in profitability which was further supplemented by reversal in provisioning.
The bank's Capital Adequacy Ratio (CAR) clocked in at 13.29% for the period ending-Sep18. Going forward, the bank envisages growth in advances wherein the criteria is higher margins with sustained risk profile.
Meanwhile, expansion in deposit base with low cost focus, while attracting a wide customer range, is on the cards.
The ratings are dependent on the financial risk profile of the bank, mainly emanating from sustenance of capital adequacy and continued healthy profitability trend in line with the management's plans.
Meanwhile, improvement in asset quality and upholding better governance standards remain imperative.
