JCR-VIS Credit Rating Co Limited (JCR-VIS) has upgraded stand-alone medium to long-term rating of National Bank of Pakistan to "AAA" from "AA+", the highest in the banking sector. JCR-VIS had earlier assigned two ratings to the NBP.
The stand-alone rating of "AA+/A-1+" (Double A Plus I A One Plus) reflected the intrinsic strength of the bank, while the credit ratings of "AAA/A-1+" (Triple A / A-ONE Plus) were based on the sovereign guarantee on the bank's deposits extended under the Bank Nationalisation Act, 1974.
During the current rating review, the JCR-VIS has given due consideration to the sustainability observed in various indicators over the past few years, which reflect significance of the NBP to the local economy.
NBP is the largest commercial bank in Pakistan in terms of its depositor base as well as its lending operations with a strong overall presence in the latter segment, including corporate, the small and medium enterprise (SME), micro, agriculture and consumer financing. It is the only public sector bank in the country, which has the advantage to profitably tap certain avenues in both local and foreign markets inclusive of running the largest treasury operations locally.
The organisation has been able to strategically manage and build on its competitive advantages, which has translated into a strong and well-managed improvement in profitability trends observed over the last few years, a substantial balance-sheet footing of Rs 635 billion of sound asset quality, strong liquidity and capitalisation levels.
Globally also, the bank is strengthening its reach and has been actively constructing a branch network in recent years with focus on South Asia, Central Asia and the Middle East, as well as China. In consideration of these factors, JCR-VIS has upgraded medium to long-term rating to "AAA" on a stand-alone basis as well. The credit rating of "AAA/A-l+" (Triple A /A-One Plus) has been re-affirmed.-PR
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