Press Release

JCR-VIS Maintains Ratings of Faysal Bank Limited

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Karachi, July 8, 2009: JCR-VIS Credit Rating Company Limited has maintained the entity ratings of Faysal Bank Limited (FBL) at ‘AA/A-1+’ (Double A /A-One Plus). Rating of the unsecured, subordinated term finance certificates (Issue-I) of FBL has also been maintained at ‘AA-’ (Double A Minus). However outlook on the ratings has been revised to ‘Negative’.

The revision in outlook of the bank’s rating is reflective of the stress in the macroeconomic environment, owing to which non-performing accounts have risen across the sector and funding cost has also risen considerably. FBL’s average cost of funds has persisted in the top quartile in the banking sector and the deposit base continues to feature high concentration. Asset quality of FBL has also shown weakening over the last year with an increase in its delinquent portfolio and infection rates increasing across all segments; though overall gross infection is lower than the industry average. With the erosion in equity during 2008, and given the asset quality indicators, capitalization levels may need to be strengthened.

On a positive note, there have been efforts to expand the branch network in order to secure a diversified deposit base, which is beginning to yield positive results. The new management of FBL has placed renewed focus on mobilizing core deposits with regular tracking of branch performance vis-à-vis targets, also facilitated by the full scale implementation of core banking application, SYMBOLS, across the network. Overall revenue generation capacity of the bank has been robust and most of the non-performing loans have been provided for. Sponsors of the bank have demonstrated their capacity and intent in the past to support FBL and stand committed to do so in future.

For further information on this rating announcement, please contact Ms. Sabeen Saleem ( or Ms. Sobia Maqbool ( at 92-21-5311861 or fax to 92-21-5311873.

Syed Ziauddin Ahmed

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 2009 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