VIS Reaffirms Broker Management Rating of Fortune Securities Limited

Karachi, November 22, 2022 (PPI-OT):VIS Credit Rating Company Ltd. (VIS) has reaffirmed Broker Management Rating of ‘BMR2’ assigned to Fortune Securities Limited. Outlook on the assigned rating is ‘Stable’. Last rating action was announced on 12th October, 2021.

The rating signifies strong external control framework, sound client relationship and HR and infrastructure, internal control framework and risk management while regulatory requirement and supervision and financial management are considered adequate. The assigned rating takes note of the Company’s governance framework, the Company has formulated various board level committees, however, repetition of common members has been observed.

Rating also takes into account strong external control framework. Internal control framework and client relationships, continue to remain sound noting updated internal policies and reinforced client management tools. HR infrastructure, compliance and risk management also continue to remain sound, the Company exercises disaster recovery practices more than once a year.

Assessment of financial management indicates deterioration of the Company’s earning profile, in line with declining market trend during FY22, the Company suffered capital and re-measurement losses which impacted the profitability. Subsequently, cost-to-income ratio was also reported to be at a high. The Company’s capitalization indicators remain manageable while liquidity profile witnessed deterioration. The Company’s market risk is reported to be historically low. Going forward, diversifying and increasing revenue stream, maintaining acceptable capitalization levels along with effective cost control measures will remain important for the rating.

Fortune Securities Limited has a TREC (Trading Right Entitlement Certificate) for Trading and Clearing Services granted by Pakistan Stock Exchange Limited (PSX). External auditors of the company are M/s Naveed Zafar Ashfaq Jaffery and Co. – Chartered Accountants. Auditors belong to category ‘A’ on the approved list of auditors published by the State Bank of Pakistan (SBP).

For more information, contact:
Director Compliance and Rating Analytics,
VIS Credit Rating Company Limited
VIS House, 128/C, 25th Lane off Khayaban-e-Ittehad,
Phase VII, DHA, Karachi, Pakistan
Tel: +92-21-35311861-72
Fax: +92-21-35311873