Press Release

VIS Reaffirms Broker Management Rating of Foundation Securities (Private) Limited

Karachi, May 20, 2020: VIS Credit Rating Company Ltd. (VIS) has reaffirmed the Broker Management Rating of Foundation Securities (Private) Limited (FSL) at ‘BMR2’. Outlook on the assigned rating is ‘Stable’. Previous rating action was announced on July 10, 2019.

The rating signifies strong risk management; sound internal and external control framework, client relationship and HR & IT infrastructure with adequate financial management and regulatory compliance levels.

Assigned rating continues to factor in implicit support from majority shareholder (Fauji Foundation Pakistan) and FSL established market position (~7% market share in FY19) in the brokerage industry. Rating also takes note of overall improvement in trading volumes in the ongoing fiscal year which has positively impacted the earning profile. Rating constraints include significant reliance on equity brokerage segment, and low capitalization buffers.

Board level governance is considered adequate while room for improvement exists in terms of board size and independent directors. Although board committees are in place, duplication of members defeats the purpose of formation. Internal audit has been segregated and outsourced while internal function in now focused on compliance and risk management. Furthermore, inclusion of Directors’ Report, CEO statement and Statement of Compliance with Code of Corporate Governance in annual accounts would add to external control environment. Given limited proprietary investments, exposure to market risk is considered on lower side.

For further information on this rating announcement, please contact Mr. Muhammad Tabish (Ext: 202) or the undersigned (Ext: 306) at (021) 35311861-66 or email at

Faryal Ahmad
Deputy CEO

Applicable Rating Criteria: Broker Management Ratings 2017

Information herein was obtained from sources believed to be accurate and reliable; however, VIS Credit Rating Company Limited (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.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.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 2020 VIS Credit Rating Company Limited . All rights reserved. Contents may be used by news media with credit to VIS .

VIS Credit Rating Company Limited