VIS Reaffirms Broker Management Rating of MRA Securities Limited
Karachi, August 03, 2022 (PPI-OT):VIS Credit Rating Company Ltd. VIS) has reaffirmed the Broker Management Rating of MRA Securities (MRA) at ‘BMR2+’. Outlook on the assigned rating is ‘Stable’. Previous rating action was announced on April 12, 2021. The rating signifies strong HR and IT infrastructure and sound Client relationship, external control and compliance and supervision framework. Regulatory framework, internal control environment and financial management are considered adequate.
Reaffirmation of rating takes note of strong HR and infrastructure and sound external control framework. The Company has recently changed auditors to an ‘A’ category, providing strength to the external control framework. Compliance and risk management framework is also sound; noting resolution of all AML related observation by SECP. Trade review procedures for non-compliant and suspicious trades have been strengthened. Client management is sound, however, the Company does not provide any research services to clients. Addition of the same may facilitate client acquisition and enhance customer experience in the long run. Governance framework is considered adequate. Increasing the board size and inclusion of certified directors may enhance the same.
Assessment of financial profile indicates improvement in earning profile of the Company in FY21 on account of increase in core brokerage income, however, brokerage volumes remained subdued in FY22 subsequently leading to negative bottom-line during 9MFY22. Higher cost to income ratio has impacted operational efficiency on a timeline basis, curtailment of administrative expenses may improve the same going forward. Liquidity profile and capitalization indicators remain adequate, however negative bottom-line may build pressure on gearing and leverage indicators. Going forward, increasing market share, improvement in profitability through augmentation and diversification of revenues, cost control and improvement of capitalization will remain important for ratings.
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