Press Release

JCR-VIS Reaffirms AA+/A-1+ Ratings of Habib Bank Limited

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Karachi, June 28, 2008: JCR-VIS Credit Rating Company Limited has reaffirmed the entity ratings of Habib Bank Limited (HBL) at ‘AA+/A-1+’ (Double A Plus / A-One Plus). Outlook on the ratings is Stable.

With a network of 1,449 branches and a strong market share, HBL is positioned as the largest private sector commercial bank in the country. Quality of deposit mix, in terms of cost effectiveness and granularity, is the key strength of HBL and is reflective of its nationwide outreach and franchise in the domestic market. The contribution of funds from overseas operations has also increased in recent years, enabling geographical diversification across different markets. Capitalization levels have strengthened further on account of retained profits and mobilization of tier-2 eligible subordinated loan during the out-going year.

Despite a low proportion of high yielding consumer assets in the portfolio, spreads have remained strong on account of high proportion of current & saving accounts in the deposit mix. Growth in corporate loan book slowed down during 2007 while the bank has only recently re-launched some of its consumer loan products. JCR-VIS believes that the current economic situation puts certain leading industrial sectors and the general consumer under financial stress. Therefore, the second half of 2008 and 2009 are likely to be challenging for the banking sector as a whole, in terms of maintaining growth, asset quality and profitability.

For further information on this rating announcement, please contact Ms. Sabeen Saleem (Ext: 510) or Ms. Sobia Maqbool (Ext: 506) at 5311861-70 (10 lines) or fax to 5311873.

Faheem Ahmad
President & CEO

Information herein was obtained from sources believed to be accurate and reliable; however, JCR-VIS Credit Rating Company Limited (JCR-VIS) does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. JCR-VIS, the analysts involved in the rating process and members of its rating committee do not have any conflict of interest relating to the rating(s)/ranking(s) mentioned in this report. JCR-VIS is not an NRSRO and its credit ratings are not NRSRO credit ratings. JCR-VIS is paid a fee for most rating assignments. This rating/ranking is an opinion and is not a recommendation to buy or sell any securities. Copyright 2008 JCR-VIS Credit Rating Company Limited. All rights reserved. Contents may be used by news media with credit to JCR-VIS.

JCR-VIS Credit Rating Company Limited