U Microfinance Bank Limited | TFC | PKR 3.5bln | Jun21

U Microfinance Bank Limited issued privately placed and secured Term Finance Certificates (TFC) up to PKR 3,500mln. The 50% of the issue amount was secured by a first pari-passu charge on the issuer’s book debts, advances, and receivables with a minimum 25% margin. The remaining 50% of the issue amount was secured by charge/lien on Government securities of a similar tenor. The profit was paid semi-annually in arrears at an annual rate of 6MK + 1.5%. Principal repayments were to be made in six semi-annual installments, totaling PKR 583mln, while the instrument maturing in June 2025. However, after six profit payments and four principal repayments, the remaining two principal installments were paid together, amounting to PKR 1,166mln, along with a combined markup payment of PKR 201mln, due to the early redemption of the instrument. The primary purpose of this issuance was to enhance the advances book, which would be supported by the additional liquidity raised through the TFC.
TFC has been paid in entirety on 23rd Decembers 2024. Subsequently, the Pakistan Credit Rating Agency (PACRA) has withdrawn the rating of U Microfinance Bank Limited | TFC | PKR 3.5bln | Jun21.

About the Entity
In 2012, PTCL acquired 100% shareholding of Rozgar Microfinance Bank Ltd, which was established in 2003, as a district-wide microfinance bank. Henceforth, its name was changed to U Microfinance Bank Limited. PTCL itself is co-owned by the Government of Pakistan (62%) and Etisalat International Pakistan (LLC) (26%) (Etisalat), a state-owned Telecom Corporation of UAE. Management control of PTCL rests with Etisalat. Mr. Mohamed Essa Al Taheri, the Bank's CEO, holds a Master’s in international business. Etisalat Group enjoys credit ratings of AA-/Stable (2024) and Aa3/Stable (2024) by S&P Global and Moody’s, respectively.