Press Release

JCR-VIS Assigns Preliminary Rating to the Proposed PPTFC issue of U Microfinance Bank Limited
 

Karachi, March 01, 2017: JCR-VIS Credit Rating Company Limited (JCR-VIS) has assigned preliminary rating of ‘BBB+’ (Triple B Plus) to the proposed Privately Placed, subordinated Term Finance Certificate (PPTFC) issue of U Microfinance Bank Limited (UMBL). Outlook on the assigned rating is ‘Stable’. The entity rating of UBML is ‘A-/A-2’ (Single A Minus / A-Two) with a ‘Stable’ outlook.
UMBL plans to issue a PPTFC for a tenor of 7 years with an issue amount of Rs. 600m. The PPTFC will contribute towards UMBL’s TIER II capital for Capital Adequacy Ratio (CAR) as per guidelines set by SBP. Principal repayment of the issue will be in four semi-annual installments after a grace period of 5.5 years while interest will be charged on semi-annual basis at the rate of 6-month KIBOR plus 3.5%. The PPTFC will be unsecured, subordinated as to payments of principal and profit to all other indebtedness of the bank including deposits. The PPTFC carries a lock-in clause as well as loss absorbency as required under Basel III criteria for regulatory capital.
For further information on this rating announcement, please contact the undersigned at 021-35311861-70 (Ext: 234) or Mr. Waqas Munir, FRM at 042-35723411-13 (Ext: 8010).


Javed Callea
Advisor

Applicable Rating Criteria:

Microfinance Banks (May 2016)
Notching the Issue (June 2016)


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Information herein was obtained from sources believed to be accurate and reliable; however, JCR-VIS Credit Rating Company Limited (JCR-VIS) does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. JCR-VIS, the analysts involved in the rating process and members of its rating committee do not have any conflict of interest relating to the rating(s)/ranking(s) mentioned in this report. JCR-VIS is not an NRSRO and its credit ratings are not NRSRO credit ratings. JCR-VIS is paid a fee for most rating assignments. This rating/ranking is an opinion and is not a recommendation to buy or sell any securities. Copyright 2017 JCR-VIS Credit Rating Company Limited. All rights reserved. Contents may be used by news media with credit to JCR-VIS.

JCR-VIS Credit Rating Company Limited