Islamabad, Aug 31: Five significant Pakistani banks had their ratings raised by international rating agency Moody’s on Saturday due to the nation’s improving economic circumstances.
The five banks’ long-term deposit ratings have been raised from Caa3 to Caa2.
Habib Bank Limited, United Bank Limited, Allied Bank Limited, National Bank of Pakistan, and MCB Bank Limited are among the banks.
Additionally, Moody’s upgraded the stable to positive outlook for each of the five banks. The move follows a downgrade of Pakistan’s credit rating from CAA3 to CAA2, along with a change in the outlook from stable to positive, by Moody’s.
The increase was attributed in large part to Pakistan’s improved economic circumstances, which included a decline in default risk, according to the worldwide ranking agency.Positive development highlighted by the agency was the nation’s $7 billion agreement with the International Monetary Fund (IMF).
The $7 billion arrangement is expected to be approved by the IMF’s executive board in the coming days. It is expected that the agreement will reduce the default risk and strengthen Pakistan’s economy.
Pakistan’s long-term issuer rating has been upgraded by Moody’s Investors Service from “Caa3” to “Caa2” with a stable outlook, which is a positive move.
This improvement comes after the nation’s credit rating was raised from “CCC” to “CCC+” by Fitch Ratings in July.
According to Moody’s, Pakistan’s improving macroeconomic circumstances and somewhat improved government external situations from extremely bad levels are reflected in this upgrade.
Additionally, we raised the senior unsecured MTN program’s rating from (P)Caa3 to (P)Caa2. Simultaneously, the government of Pakistan’s outlook has shifted from steady to positive.
As a result, Pakistan no longer faces default risk at a level that is commensurate with a Caa2 rating
