Press Release
PACRA Assigns Initial Broker Fiduciary Rating to EFG Hermes Pakistan Limited
Date: 31-Mar-22
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Rating Details | Rating Type | BFR | |
Dissemination Date | Current (31-Mar-22 ) | ||
Action | Initial | ||
Rating | BFR 2+ | ||
Outlook | Stable | ||
Rating Watch | - |
Rating Rationale | Factor | Comment |
Ownership | Majority shares are owned by EFG Hermes Frontier Holdings LLC with ownership stake of ~51%. | |
Governance | The board is comprised of seven members. There are 4 non-executive directors and 2 independent directors. While a female director is also present. | |
Management and Client Services | Management team consist of seasoned professionals reporting to their respective heads at group level. Client servicing is considered strong. | |
Internal Controls and Regulatory Compilance | Internal audit is performed at the group level. Dedicated risk management and compliance department are also present. | |
Business Sustainability | Brokerage income improved by ~40% YoY at end-Dec'21. The profitability stood at ~PKR 29mln for CY21 (SPLY: ~PKR 1.6mln). | |
Financial Sustainability | The liquid capital balance stood at ~PKR 854mln at end-Dec'21. There are no proprietary book investments as per Company policy. |
Key Rating Drivers |
About the Entity | |
Legal Structure | Listed |
Year of Establishment | 27-Sep-99 |
Type of License | Trading and Self-clearing |
Majority Ownership | EFG Hermes Frontier Holdings LLC | ~51% |
Regulatory Disclosures | Analyst | Applicable Criteria | Related Research |
Afnan Iqbal afnan.iqbal@pacra.com +92-42-35869504 www.pacra.com |
Methodology | Broker Fiduciary Rating | Jan-21 |
Sector Study | Brokerage & Securities | Jan-22 |
Disclaimer | This press release is being transmitted for the sole purpose of dissemination through print/electronic media. The press release may be used in full or in part without changing the meaning or context thereof with due credit to PACRA. The primary function of PACRA is to evaluate the capacity and willingness of an entity to honor its obligations. Our ratings reflect an independent, professional and impartial assessment of the risks associated with a particular instrument or an entity. PACRA opinion is not a recommendation to purchase, sell or hold a security, in as much as it does not comment on the security's market price or suitability for a particular investor. |