Press Release
VIS Maintains Ratings of HBL Microfinance Bank Limited
Karachi, April 30, 2026: VIS Credit Rating Company Limited (VIS) has maintained the entity ratings of HBL Microfinance Bank Limited (‘HBL MfB’ or the ‘Bank’) at ‘A+/A1’ (Single A Plus/A One). The medium to long-term rating of ‘A+’ denotes good credit quality; protection factors are adequate. Risk factors may vary with possible changes in the economy. The short-term rating of ‘A1’ denotes strong likelihood of timely repayment of short-term obligations with excellent liquidity factors. Outlook on the assigned ratings changes from ‘Stable’ to ‘Positive’. The previous rating action was announced on April 30, 2025.
HBL Microfinance Bank Ltd. (‘HBL MfB’ or the ‘Bank’) was incorporated in November 2001 as a public limited company under the Companies Ordinance, 1984 (Repealed: Company Act 2017). HBL MfB started business in February 2002 after receiving certificate of commencement of business as a nation-wide microfinance bank, licensed by the State Bank of Pakistan (SBP). The Bank was created through a structured transformation of the credit and savings section of the Aga Khan Rural Support Programme (AKRSP) with the mission to respond to poverty and contribute to the social and economic well-being of the society by providing opportunities to underprivileged households, to improve their quality of life.
HBL MfB’s ratings reflect strong sponsor support from its majority shareholder “Habib Bank Limited (HBL)”, a leading commercial bank, manifesting through continuous and timely capital injections over the years along with providing other capital funding including Tier-2 Subordinated Debt and Additional Tier-1 capital.
HBL MfB has an extensive nationwide footprint, with a focus on digitalization and financial inclusion. The Bank has grown its lending portfolio, shifting toward higher-ticket and relatively safer segments through reducing reliance on riskier bullet loans. Non-performing loans rose in 2025 mainly driven by stress in the agriculture segment, although stronger provision coverage mitigates risk to balance sheet quality.
HBL MfB has achieved a turnaround in profitability in CY25 amid improved spreads, despite high provisioning charges. With IFRS-9 implementation having been finalized and related Expected Credit Loss charges taken in the prior year, profitability is likely to recover significantly in the current year. Capitalization remains adequate, supported by equity injections and likely to be sustained through improved internal capital generation, henceforth. The ‘positive’ outlook takes into account the expected improvement in ratings as profitability and internal capital generation capacity strengthens. Future ratings remain sensitive to asset quality trends, improvement in profitability, and successful portfolio diversification aimed at lowering credit risk profile.
For further information on this ratings announcement, please contact at 021-35311861-64 or email at info@vis.com.pk.
Applicable Rating Criteria:
Micro-Finance Bank Rating
https://docs.vis.com.pk/Methodologies-2025/MicroFinance-Nov-2025.pdf
VIS Issue/Issuer Rating Scale
https://docs.vis.com.pk/docs/VISRatingScales.pdf