Press Release

VIS Reaffirms Broker Management Rating of Next Capital Limited

Karachi, March 24, 2021: VIS Credit Rating Company Ltd. (VIS) has reaffirmed the Broker Management Rating of Next Capital Limited (NCL) at ‘BMR2++’. Outlook on the assigned rating is ‘Stable’. The previous rating action was announced on April 8, 2020.

The rating signifies strong external control environment and risk management while regulatory compliance levels, internal control framework, HR & IT services and financial management are considered sound.

Reaffirmation of rating incorporates NCL’s market position in brokerage and corporate advisory business and the company’s diversified revenue mix. Rating also factors in improvement in net capital balance and 1/3rd representation of independent directors on the board however; formation of risk management committee would bode well with best governance practices

On internal controls front, guidelines for trading in blackout periods need to be added to the Employee Trading Policy (ETP). External control framework can be further enhanced by including CEO’s statement for fraudulent and illegal transactions to the annual financial statements. In line with best international practices, the company’s participation in propriety trading has remained minimal on a timeline basis. The general improvement in stock market activity led to an improvement in profitability by two-fold at HY21 on account of higher brokerage revenue. Accordingly, cost to income ratio also improved during the period under review. Going forward, sustainability of the same will be observed overtime.

For further information on this rating announcement, please contact Mr. Muhammad Tabish (Ext: 204) or the undersigned (Ext: 306) at (021) 35311861-66 or email at info@vis.com.pk





Faryal Ahmad
Deputy CEO

Applicable Rating Criteria: Broker Management Ratings 2020
https://s3-us-west-2.amazonaws.com/backupsqlvis/docs/BMR202007.pdf

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