Karachi: JCR-VIS Credit Rating Company Ltd. has reaffirmed the entity ratings of Taurus Securities Limited (TSL) at ‘A-/A-2’ (Single A Minus/A-Two). Outlook on the rating is ‘Stable’.
Ratings assigned to TSL incorporate the strength of the majority shareholder, National Bank of Pakistan, the largest commercial bank in the country. Stand-alone financial profile of the company has remained steady, with prudent margin policy and limits on counterparties having facilitated effective monitoring and realization of trade receivables.
In the backdrop of lower trading volumes, revenues from brokerage operations have declined. The company has however been able to capture a larger market share of traded volumes in recent periods, which has facilitated in containing the decline in brokerage revenues. In order to bridge the gap between brokerage revenues and administrative expenses, which has widened over time, the company has been deploying excess liquidity in MTS and Futures Trading to generate supplementary revenues. Management’s focus on cost control through branch consolidation and a compensation structure linked to business activity has helped the company to maintain a low cost base and remain marginally profitable, despite losses faced by peers.
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