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Pak Libya Holding Co maintains ratings (25/06/2020)

Pakistan Credit Rating Agency Limited (PACRA) has maintained the long-term and short-term entity ratings of Pak Libya Holding Company (Private) Limited [PLHC] at AA- (Double A minus) and A1+ (A one plus) respectively while improving the outlook from "Negative" to "Stable".

The Ratings of Pak Libya reflect improved performance of the company; core margins have seen significant improvement, as core profits were reported (1QCY20: PKR 69mln). Alternative income streams were built, like trading in Govt. securities, specifically investing in PIBs; enhanced tactical allocation in accordance with current market conditions being manage well though exposure to market risk needs to be consistently monitored. Management intends to refine the existing investment policy. Resultantly, company booked capital gain compared to capital losses which has supplemented the profits in latest quarter. Recoveries, resulted from settlement of NPLs, were leading to reversal in provisioning also helped profits. Funding base majorly comprises borrowings from money market while minuscule portion lies in CoIs. Notably, Covid-19 has posed challenges to all segments of the economy, worldwide and domestically, most sectors are getting negatively impacted. The ramifications would continue to unfold, warranting vigilance and timely actions where needed.