KARACHI: The Pakistan Credit Rating Agency Limited (PACRA) has affirmed the entity ratings of Bank AL Habib Limited (BAHL), underscoring the bank’s robust market positioning in a competitive banking environment. BAHL’s strategic initiatives, anchored in sound governance and prudent risk management, have enabled it to expand market presence and sustain growth.

The bank’s focus on nurturing customer relationships has remained a central pillar of its strategy, contributing to customer loyalty and growth. Core strengths in trade finance and foreign remittances have bolstered revenue diversification and industry positioning. In the recent fiscal year, foreign trade volumes remained high, and a renewed focus on remittances improved market share and maintained a positive contribution in forex terms.

BAHL’s deposit base saw significant growth, increasing to PKR 2.28 trillion from PKR 1.93 trillion, which raised its market share to 7.31%. The Current Account Savings Account (CASA) ratio improved to 88.45%, while advances rose to PKR 910.9 billion. However, there was an increase in non-performing loans, linked to a few large exposures, though these are adequately provisioned for, and the bank’s management remains optimistic about recoveries.

Despite elevated provisioning, BAHL reported an increase in profit after tax to PKR 39.9 billion, up from PKR 35.3 billion. The bank is also expanding its acquiring business and enhancing its presence in the broader financial services sector to meet evolving customer expectations.

Going forward, while the sector may face margin compression due to monetary easing, BAHL’s strategic clarity and strong customer relationships position it to sustain growth and maintain its standing as a stable and trusted institution in Pakistan’s banking sector. The ratings are contingent upon the bank maintaining its market position and asset quality, with strong capital adequacy remaining crucial.