The Pakistan Credit Rating Agency Limited
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PACRA Maintains Entity Ratings of First Women Bank Limited | RW | Developing Outlook

Rating Type Entity
(27-Jun-23 )
(28-Jun-22 )
Action Maintain Maintain
Long Term A- A-
Short Term A2 A2
Outlook Developing Developing
Rating Watch Yes Yes

First Women Bank Limited (FWBL) is associated with the Government of Pakistan (GoP) - the major shareholder. The Bank received various capital injections from the Ministry of Finance (MoF), latest in CY17, mainly to comply with minimum capital requirements. The audit of CY18 has been completed during CY22 and financial statements were published on the website along with the audited report. While the external audit for CY19 & CY20 are underway and the remaining pending audits shall be completed in due course. M/S KPMG Taseer Hadi & Co., Chartered Accountants, classified in category 'A' by SBP and having a satisfactory QCR rating were the joint external auditors. The Board of the bank remained nonfunctional since Jan19 due to vacancies not being filled. MoF appointed a Chairman/Director on the Board on Sep 09, 2021. Now with the Board's completion, the Bank's overall control vests with a six-member Board of Directors (BoD) including the CEO/ President. As per the unaudited financial statements for CY22, an increase in profitability was supported by a higher topline was noted. Bank's PAT for CY22 clocked at PKR 168mln. Outlook reflects weakening in capitalization indicators of the Bank. The minimum capital requirement (MCR) of the bank was reported at PKR 2.5bln as of Dec 22 (end-Dec21: PKR 2.4bln), against the minimum requirement of PKR 3bln (net of losses). While the capital adequacy requirement (CAR) of the bank is reported at 20.6% (Dec 21: 30.3%), against the minimum requirement for FWBL of 18%. The deposit system share inched up (end-Dec22: 0.2%, end-Dec21: 0.1%). Whilst, the CASA of the Bank clocked in at 70.5% (CY21: 79.5%). Advances witnessed a marginal uptick. It remains essential to hold and improve asset quality. The current management team took the initiative to improve the revenue stream and managed to contain the cost. The Bank’s investment portfolio is entirely comprised of government securities. Going forward, the management is planning to take various strategic initiatives including, the improvement of net spread, expansion of retail customer base, improving lending business, SME business, and re-branding corporate image.
The ratings capture the need to sustain a growth trend in profitability and deposits. Revision and successful execution of the business strategy, while improving the efficacy of the risk management framework to improve asset quality.

About the Entity
First Women Bank Limited (FWBL) was established in 1989. The bank operates through a network of 42 branches spread over 24 cities nationwide as of Dec-22. The bank focuses on catering to women at all levels of economic activity; micro, SME, and corporate. The Government of Pakistan owns a majority stake - ~85% (~83% through the Ministry of Finance and ~2% through NBP) in the bank. The rest of the shareholding comprises four large banks (ABL, UBL, HBL, and MCB). MoF appointed Chairman/Directors on the Board on Sep 09, 2021. The overall control of the Bank vests with a six-member Board of Directors (BoD) including the CEO/ President. Mr. Najeeb Agrawalla is the Chairman of the Board and has 31 years of experience. All the other board members have different educational and work experience backgrounds. Mr. Farrukh Iqbal Khan is appointed by the Ministry of Pakistan (MoF) Government of Pakistan on Dec 30, 2019, as President & CEO of FWBL. He joined the Bank as President/CEO on Jan 03, 2022. He is a veteran banking professional with 29 years of diversified experience.

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