ISLAMABAD – Moody’s has raised the local and foreign-currency long-term deposit ratings of five leading Pakistani banks, citing the country’s improving economic outlook and stronger external position.
The upgraded institutions include Allied Bank Limited (ABL), Habib Bank Limited (HBL), MCB Bank Limited (MCB), National Bank of Pakistan (NBP), and United Bank Limited (UBL). Their long-term deposit ratings have been lifted from Caa2 to Caa1, while Baseline Credit Assessments (BCAs) of ABL, HBL, MCB, and UBL have also been elevated to Caa1, with NBP’s revised to Caa2. The outlook for all five banks has been shifted from positive to stable.
According to Moody’s, the decision reflects resilience in the banking sector through stable, deposit-based funding, robust liquidity, and healthy earnings. The ratings agency highlighted that Pakistan’s progress under the IMF programme, a sharp decline in inflation, and reductions in policy rates have created room for stronger credit growth, especially in consumer and SME sectors.
Despite the positive momentum, Moody’s cautioned that risks remain. Lower interest rates may reduce banks’ profit margins, while heavy exposure to government securities continues to pose asset risks. Any deterioration in sovereign conditions or weakening of banks’ capital and profitability could affect future ratings.
This story has been reported by PakTribune. All rights reserved.