Press Release

JCR-VIS Revises Entity Ratings of Rozgar Microfinance Bank Limited to BB-/B from BB/B

Karachi, April 29, 2009: JCR-VIS Credit Rating Company Limited (JCR-VIS) has revised the entity ratings of Rozgar Microfinance Bank Limited (RMBL) from ’BB/B’ (Double B / Single B) to ’BB-/B’ (Double B Minus / Single B). Ratings continue to be under ‘Rating Watch-Negative’ status.

RMBL was set up with a minimum paid up capital of Rs. 100m required for district level microfinance banks; however, with continuous losses since inception, equity of the bank has been significantly eroded and has fallen below the minimum regulatory requirement. The bank’s performance has been adversely affected by turnover at all levels of management especially core management and the critical control positions remained vacant throughout the outgoing year. Currently, the liquidity of the bank is sufficient to meet its obligations, however, if losses persist, these reserves may quickly be used up.

The performance has also been affected by geographical concentration in Karachi, where microfinance credit culture is still underdeveloped and the population is vulnerable to law and order related disruption, in addition to acute power shortages. The virtual standstill in business activity, with no disbursement since July 2008 has also contributed to the present situation.

To meet the shortfall in minimum capital requirement, the board is exploring a number of possibilities. JCR-VIS will closely monitor these trends and keep the stakeholders informed as concrete plans emerge. In case, the bank is not recapitalized on an urgent basis, ratings may be revised further downwards in the coming months.

For further information on this rating announcement, please contact Mr. Safdar Kazi (Ext: 501) or Mr. Manzoor H. Memon (Ext: 512) at 5311861-70 or fax to 5311873.

Faheem Ahmad
President & CEO

Information herein was obtained from sources believed to be accurate and reliable; however, VIS Credit Rating Company Limited VIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information.VIS, the analysts involved in the rating process and members of its rating committee do not have any conflict of interest relating to the rating(s)/ranking(s) mentioned in this report.VIS is not an NRSRO and its credit ratings are not NRSRO credit ratings.VIS is paid a fee for most rating assignments. This rating/ranking is an opinion and is not a recommendation to buy or sell any securities. Copyright 2009 VIS Credit Rating Company Limited. All rights reserved. Contents may be used by news media with credit to VIS.

JCR-VIS Credit Rating Company Limited