PACRA Maintains Broker Management Rating of Habib Metropolitan Financial Services Limited

Habib Metropolitan Financial Services Limited ('HMFSL' or the 'Company') primarily provides equity brokerage services to individuals and financial institutions. HMFSL is part of the Habib Metropolitan Bank Limited ('HMB') Group, which provides an important institutional and governance framework to the Company. The association with a well-established banking group supports oversight, financial flexibility, and access to institutional expertise. HMFSL continues to operate with a lean organizational structure, supported by experienced management and Board oversight, enabling focused execution while maintaining control over operations. The Board benefits from the banking and financial sector experience of Mr. Amanullah Shaikh, Syed Ather Ather Ahmad, and Syed Hasnain Haider Rizvi. The Board’s composition reflects a blend of banking and financial sector expertise, with members supporting effective governance, strategic oversight, and informed decision-making. The Company has experienced a change in its product function, with Mr. Iftikhar Hasan, Head of Online Product, having resigned. The position remains vacant, with the Company yet to appoint a replacement. While the existing structure continues to support operations, timely appointment of dedicated leadership for the online product function remains important to maintain continuity and support the Company's digital business development. The governance framework is further supported by an in-house internal audit function, while established KYC, CDD, AML, CFT and whistleblowing protocols provide a framework for compliance, risk management and internal controls. Pakistan's brokerage industry remained supported by favorable market conditions during 1HCY26, with HMFSL benefiting from increased market activity. Brokerage revenue increased by ~40% in 1HCY26, reflecting improved business volumes and revenue generation. However, earnings remained under pressure during the year, indicating that the increase in brokerage activity has yet to translate into sustainable profitability. Improving earnings conversion through greater operating efficiency remains an important area of focus. The Company's capitalization strengthened materially, with equity increasing to ~PKR 564mln as at Jun'26 from ~PKR 325mln in Jun'25. The liquid capital balance (LCB) also improved to ~PKR 413mln from ~PKR 200mln, providing enhanced financial flexibility and capacity to absorb market and operating stresses. HMFSL does not engage in proprietary investments, limiting direct exposure to market risk arising from proprietary positions.
Going forward, the strength of the HMB Group association, continued Board and management oversight, improvement in earnings generation, and timely strengthening of key functional leadership will remain important considerations in assessing HMFSL's management profile.

About the Entity
Habib Metropolitan Financial Services Limited ('HMFSL' or the 'Company') was incorporated in 2007 as a public limited company under the Companies Act, 2017 and commenced its operations in 2008. Habib Metropolitan Bank Limited (HMBL) is the parent company of HMFSL. HMBL currently operates with an expanding nationwide network of more than 573 branches in more than 229 cities across Pakistan at end-June'26. The Company has three directors on the board. The CEO, Mr. Ather Hussain Medina is a qualified professional with extensive work experience of over 33 years in the financial sector and has worked with well-known companies.