JCR-VIS Credit Rating Company Limited has reaffirmed the entity ratings of Al-Zamin Leasing Modaraba (AZLM) at "A-/A-2" (Single A Minus/Single A-Two). The ratings assigned to the first and second tranche of the listed Musharakah term finance certificates have also been reaffirmed at "A" (Single A) with a "Stable" outlook.
The Rating Agency maintained that there has been significant growth and diversification in the Modaraba's assets subsequent to FY2005. Leverage indicators have increased but are still at acceptable levels. Profitability indicators have posted significant improvement subsequent to financial year-end 2006 due to diversification of income streams of the Modaraba.
Liquidity and portfolio quality indicators had come under some pressure in FY2006. The management has since been monitoring and reinforcing recovery efforts to improve asset quality indicators. Long-term funds have also been mobilised for improving maturity mismatch situation. It is expected that further improvement in the above-mentioned risk indicators will be achieved by December 2007.
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