Karachi, May 02, 2023 (PPI-OT): VIS Credit Rating Company Ltd. (VIS) has assigned initial Broker Fiduciary Rating of ‘BFR3+’ to Multiline Securities Limited (MSL). Outlook on the assigned rating is ‘Stable’. The rating signifies sound ownership and governance and management and client services, while business and financial sustainability, internal control framework and regulatory compliance are considered adequate.
Assigned rating takes note of Company’s ownership and governance whereby the board comprises of four members along with independent representation. Increasing the board size may be considered in order to strengthen the Company’s governance and supervision framework. External control framework may enhance by adding CEO’s independent statement in annual reports.
Rating also takes into account Company’s client relationship management where Company has availability of research reports and related tools on their website. However, increasing the scope of certain internal policies along with geographical diversification to support future business growth may be considered. On the internal control and regulatory front, internal audit and compliance departments are placed independently, boding well for the Company’s regulatory compliance. However, credit limits extended to retail customers may be considered to enable better risk management.
Assigned rating reflects deterioration in profitability profile of the Company in FY22 due to decrease in brokerage revenue on the back of slowdown in market activity. Subsequently, cost to income ratio was also impacted, curtailment of administrative expenses may be considered to improve the same. Market risk and capitalization indicators are considered manageable while liquidity profile is also considered adequate. Going forward, augmentation of revenue streams, increasing operational efficiency coupled with maintenance of capitalization may bode well for the rating.
Multiline Securities Limited (MSL) is a public unlisted company offering share brokerage, investment and portfolio management services to both retail and foreign intuitional clients. The company holds a Trading Right Entitlement Certificate (TREC) issued by the Pakistan Stock Exchange Limited (PSX) since 2001. Furthermore, MSL’s operations run through its registered offices in Karachi.
For more information, contact:
Director Compliance and Rating Analytics,
VIS Credit Rating Company Limited
VIS House, 128/C, 25th Lane off Khayaban-e-Ittehad,
Phase VII, DHA, Karachi, Pakistan
Tel: +92-21-35311861-72
Fax: +92-21-35311873
Email: bilal@jcrvis.com.pk
Website: https://www.vis.com.pk/