20000106

Creslease assigned

A-, A2 rating

RECORDER REPORT

KARACHI: The Pakistan Credit Rating Agency (Pacra) has assigned a long-term rating of A- (A minus) and a short term rating of A 2 (A two) to the Crescent Leasing Corporation Limited (Creslease).

In assigning these ratings Pacra has taken cognizance of Creslease's prudent and consistent risk management policies which have resulted not only in strengthening the financial base of the company but also in significantly improving the asset quality.

The assigned ratings denote a low expectation of credit risk emanating from the company's strong capacity to service its obligations on a timely basis.

Owing to prudent client selection and diversification policies, Creslease's credit risk continues to remain low.

The lease portfolio remains well diversified both in terms of sector as well individual exposures. Despite a low level of impairment in the lease portfolio the provisions for potential lease losses have been substantially augmented resulting in a significant enhancement in the provision coverage.

Creslease's profitability indicators remain well above the leasing sector averages and going forward, the profitability is expected to improve as some additional costs incurred during financial year 1999 are not likely to recur.

While, the company has emerged as one of the financially sounder entities in the sector.