Lahore, December 20, 2021 (PPI-OT):The ratings reflect the relative position of JS Bank in the country’s competitive banking landscape. This stems from largely intact customer deposit system share (end-Dec20: 2.4%, End-Dec19: 2.3%). The Bank has assembled a highly experienced and qualified top management team to head various departments. Advances were largely maintained in end-Sep21 compared with end-Dec20. NPLs have risen from PKR 11.7bln in Dec20 to PKR 14.6bln in Sep21. Though the overall infection ratio of the Bank remains below the industry average. The total deposits of the Bank stand at PKR 439bln as at end Sep21 where current deposits witnessed an increase. The total CAR stood at 13.1% (Tier-I at 10.5% as of Sep21).

Although gross mark-up income has come down significantly because of the reduced interest rate environment, the net mark-up income has gone up which shows efficient ALM management and way forward will increase Bank’s profitability due to rise in interest rates, enabling the Bank to book net income closer to the annual net income level the previous year. The Bank has achieved internal reorganization; this has been done to focus the targeted areas of growth while meeting the associated challenges. Further strengthening in risk framework is being ensured through segregation of credit and risk function into sub-categories based on functions and geography. The Bank expects the profits to be boosted from growing direct and ancillary business.

Ratings are dependent on JS Bank’s ability to sustain its profitability to support the internal generation of capital. Meanwhile, upholding asset quality, maintaining system share in terms of advances and deposits, adding diversity to an income stream, sound CAR, and strong governance framework is critical.

For more information, contact:
Analyst,
The Pakistan Credit Rating Agency Limited (PACRA)
Awami Complex, FB1, Usman Block New Garden Town,
Lahore, Pakistan
Tel: +92-42-5869504-6
Fax: +92-42-5830425
Email: hammad.rashid@pacra.com
Website: www.pacra.com