Press Release

JCR-VIS reaffirms rating of First National Bank Modaraba at A- / A-2 with a ‘Positive’ outlook

Karachi, April 18, 2007: JCR-VIS Credit Rating Company Limited has re-affirmed the medium to long-term entity rating of First National Bank Modaraba at ‘A-’ (Single A minus) with a ‘Positive’ outlook. Short-term rating has also been reaffirmed at ‘A-2’ (A-Two).

Ratings take into consideration the growth in financing portfolio during FY06 and exceptional asset quality indicators that have been maintained so far. Level of client concentration has improved during FY06, though the portfolio needs to be diversified further. This is however also a function of a small base, while per party exposures are not large in absolute terms. Growth in recent periods has resulted in increasing leverage and infusion of capital will be required to maintain the company’s growth momentum.

Earnings have improved over FY06 and HY07 even though spreads shrank throughout the sector. With low priced fixed rate leases maturing over time, profitability is expected to improve further, assuming overheads continue to be controlled and asset quality is maintained. JCR-VIS has incorporated the impact of the presence of National Bank of Pakistan as a major stakeholder by virtue of the management company being a wholly-owned subsidiary of the bank.

For further information on this rating announcement, please contact Mr. Safdar Kazi or Ms. Sabeen Saleem at 5311861 – 72 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 2007 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