A Medium to communicate with the Users of Ratings
ISSUE III; February 2014
PACRA INSIGHT
Wednesday, February 12, 2014
Humaira Jamil
• The Insight behind PACRA INSIGHT
• PACRA’s Rating Universe (Product-by-product) – Key Developments & Trends
• Pakistan’s Rating Universe – Snapshot
• Industry View – General Insurance, Microfinance, Power, Refining, Textiles, AMCs, cement
Communicating…….
The Insight behind PACRA INSIGHT
Consolidating Information
Promoting Transparency
There is nothing so terrible as ACTIVITY without INSIGHTJohann Wolfgang Von Goethe
PACRA’s Rating Universe – Key Developments & Trends
Dec10
Jun11 Dec11
Jun12 Dec12
Jun13 Dec13
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
0
50
100
150
200
250
300
220215
210220
219 218222
FIGURE ISNAPSHOT - PACRA Ratings Composition
(Dec10- Dec13)
Entity Ratings
Instrument Ratings
Mutual Funds (including Asset Managers)
PACRA Opinions (Total)
Rati
ngs
( P
AC
RA
Univ
ers
e S
hare
%)
PA
CR
A U
niv
ers
e-T
ota
l R
ati
ngs
(Nos.
)
220215
210220
219 218222
0
50
100
150
200
250
300
-30
-20
-10
0
10
20
30
Dec10 Jun11 Dec11 Jun12 Dec12 Jun13 Dec13
Total PACRA
Opinions (N
os.)
New
(wit
hdra
wn
/ re
deem
ed) R
ating
s (N
os.)
FIGURE IISNAPSHOT - PACRA Ratings Universe Growth
(Dec10 - Dec13)
New ClientsWithdrawals / Redemptions
PACRA’s Rating Universe – Entities
-2
-1
0
1
2
3
4
AAA AA+ AA AA- A+ A A- BBB+ BBB BBB- BB-B CCC-C
Rati
ng A
ctivi
ty -
upgr
ades
/Dow
ngra
des
(Nos
.)
FIGURE IVEntity Rating Activity across Rating Categories
(For calendar year ended Dec 31, 2013)
Upgrades Downgrades
92 92
93
95
93
95
97
89
90
91
92
93
94
95
96
97
98
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Dec10 Jun11 Dec11 Jun12 Dec12 Jun13 Dec13
Rati
ngs
cate
gory
Sha
re (
%)
FIGURE IIIPACRA Entity Ratings Composition & Growth
(Dec10 - Dec13)
AAA AA ABBB BB - B CCC - CAll Entity Ratings
PACRA’s Rating Universe – Entities
PACRA ENTITY RATING UNIVERSE (Entry / Exit) (For calendar year ended Dec 31, 2013)
Entities Initial L/T
Ratings Withdrawn Entities
Last L/T Ratings
Financial Institutions
1. SME Bank BBB 1. Pak Brunei Investment Company AA
2. The Pakistan General Insurance Company
A- 2. Arif Habib Investments A+
3. Waseela Microfinance Bank BBB+
4. Saudi Pak Insurance Company A-
Corporates
5. Autosoft Dynamics A- 3. Ahmed Fine Textile Mills A-
6. Mangla Metals BBB 4. Hussain Mills A-
7. Kohsar HydroPower BBB 5. FFC Energy A
8 Pakistan Refinery A- 6. Halmore Power Generation Company A
9. Islamabad Electric Supply Company
A+
10. Maple Leaf Cement Factory Limited
BB
PACRA’s Rating Universe – Outlook Analysis
Ratings Outlook Analysis
Positive Negative
Opening @ July 1, 2013 9 6
Translated in Rating Change (-) 1 3
Translated in Outlook Change (-) 2 0
Maintained (+) 5 3
Ratings Not Reviewed (+) 0 0
Withdrawn (-) 1 0
During 1HFY14: New (+) 4 2
Opening @ Jan 01, 2014 9 5
PACRA’s Rating Universe – Instruments
58
5146
49
45 3936
0
10
20
30
40
50
60
70
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Dec10 Jun11 Dec11 Jun12 Dec12 Jun13 Dec13
Ratings (N
os.)
Rati
ngs
cate
gory
Sha
re (
%)
FIGURE VSNAPSHOT - PACRA Instrument Rating Universe Composition
& Growth(Dec10- Dec13)
AAA AAA BBBBB - B CCC - CAll Instrument Ratings
PACRA’s Rating Universe – Instruments
1TBI: To be issued 2CY13 had 15 Instrument Redemptions
PACRA INSTRUMENT RATING UNIVERSE (Entry / Exit)(For calendar year ended Dec 31, 2013)
[Initial ratings] Issuers / Instruments Initial Instrument Ratings
1. NIB Bank | TFC II: Upto PKR 5,000mln (including a green shoe option of PKR 1,000mln) TFC TBI1 A+
2. PAIR Investment Company | CP: PKR 500mln CP TBI AA
3. Bank Alfalah | TFC V: PKR 500mln TFC V issued Feb13 AA-
4. The Pakistan Water & Power Development Authority | PPTFC2: PKR 9,327mln TFC issued Sept13 AAA
5. Pakistan Refinery Limited | TFC I: PKR 500mln issued Aug13 A
6. Pakistan Refinery Limited | TFC II: PKR 500mln issued Aug13 A
7. Maple Leaf Cement Factory Limited | Restructured Sukuk: PKR 8bln Sukuk restructured Sept12 BB+
[Withdrawn3 ratings] Issuers / Instruments Last Instrument Ratings
1. Engro Fertilizers | Sukuk II: PKR 1,500mln TBI A
PACRA’s Rating Universe – Asset Management Ratings
12
9 9
12 1211 11
0
2
4
6
8
10
12
14
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Dec10 Jun11 Dec11 Jun12 Dec12 Jun13 Dec13
Ratings (N
os.)
Rati
ngs
cate
gory
Sha
re (
%)
FIGURE VIIISNAPSHOT - Asset Manager Ratings Composition
& Growth(Dec10- Dec13)
AM1 AM2AM3 AM4AM5 All Asset Manager Ratings
2831
33
3739 39
42
0
5
10
15
20
25
30
35
40
45
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Dec10 jun11 Dec11 Jun12 Dec12 Jun13 Dec13
Rati
ngs
cate
gory
Sha
re (
%)
FIGURE IXSNAPSHOT - Fund Stability Ratings Composition &
Growth(Dec11- Dec13)
AAA(f) AA(f) A(f)
BBB(f) Total
27 28
2727
29 2935
0
10
20
30
40
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Dec10 Jun11 Dec11 Jun12 Dec12 Jun13 Dec13
Ratings (N
os.)
Rati
ngs
cate
gory
Sha
re (
%)
FIGURE VIIISNAPSHOT - Mutual Fund Rankings
Composition & Growth (Dec10 - Dec13)
1-star 2-star3-star 4-star5-star All Rankings
Credit Risk – Rise & Fall
A Rise in Credit Risk
EntitiesRatings
New(Action date) Previous Notches
Shaheen Insurance Company
BBB-(01Aug13) A- 3
National Refinery
AA+(23Oct13) AAA 1
Pakistan’s Rating Universe - Snapshot
209 228 223 231 232
172 179 187 188 190
381
407410
419 422
360
370
380
390
400
410
420
430
050
100150200250300350400450
CY09 CY10 CY11 CY12 CY13
Universe Rati
ngs (Nos.)D
CRA
Rati
ngs
(Nos
.)
FIGURE XIPakistan Ratings Universe Growth
(CY09 - CY13 )
PACRA JCR-VIS Universe5
37 43
11 1 07
20
42
16 4 012
57
85
27 5 0
0
20
40
60
80
100
AAA AA A BBB BB - B CCC - C
Rati
ngs
(Nos
.)
FIGURE XPakistan Entity Ratings Universe Compostion in
Rating Categories (As @ Dec 31, 2013 )
PACRA JCR-VIS Universe end-CY13
Pakistan’s Rating Universe – Classes of Ratings
2711
24 2713
24 32 257
21
15
18
46
11
3542
42
20
25
50
75
100Ra
ting
s (N
os.)
FIGURE XIPakistan Ratings Universe Compostion in Rating
Classes(As @ Dec 31, 2013 )
JCR PACRA
UPCOMING:
ISSUE IV; August 2014
Thank You !