NBP Major Participation in Shari’a Compliant Financing Facility for PIA

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enewspaper.com.pk
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Karachi (PR): Pakistan International Airlines Corporation (PIA) has executed facility documentation for a $130 million Shari’a compliant financing facility. National Bank of Pakistan has a major participation in above mentioned deal with $60 Million. National Bank of Pakistan (NBP), AAA/A-1+’ (Triple A / A-One Plus) rated by JCR-VIS Credit Rating Company Limited (JCR-VIS), is one of the largest commercial Bank of Pakistan. NBP is the first ever commercial bank of Pakistan to cross the ‘One Trillion Rupee’ bench mark, with more than 1300 branch network across Pakistan and 23 overseas branches and representative offices in four countries. The Bank also handles treasury transactions for the Government of Pakistan (GoP) as an agent to the State Bank of Pakistan. NBP is awarded number of international and national awards as Domestic Retail Bank of the Year 2013 – Pakistan andPakistan Domestic Technology and Operations Bank of the Year Award 2013 by “Asian Banking & Finance Magazine”, Owned by Charlton Media Group, Singapore and NBP is “Listed in top 1000 banks of the world for the year 2013” by the world renowned “The Banker”magazine owned by the Financial Times Group, London. Apart from these, the Bank also got The Best Emerging Markets Bank in 2011, 2006, 2005 and in 2003 and NBP was awarded “Best Foreign Exchange Bank in Pakistan” in 2004, 2005, 2006 and 2008 years. NBP is in “Top 1000 World Banks 2011” by The Banker magazine of UK. The bank’s growth indicators are healthy. The bank is well capitalized with capital and reserves of Rs. 145.850 billion and capital adequacy ratio of over 15%.

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Citibank N.A., National Bank of Pakistan and WARBA Bank K.S.C. acted as Mandated Lead Arrangers for the transaction. The transaction participants also include Bank Alfalah Limited, United Bank Limited and Alubaf Arab International Bank. Citi is also acting as the Security Trustee and the Account Bank for this transaction. This innovative Islamic transaction is secured by PIA’s ticket sales generated in the Kingdom of Saudi Arabia and accumulated through IATA’s Billing and Settlement Plan. The three-year facility will be used for PIA’s general corporate purposes and reflects investor confidence in the airline and its strategic importance to Pakistan.

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PIA’s Managing Director, Muhammad Junaid Yunus, said, “We are working to enhance the airline’s fleet capacity by adding narrow body aircrafts. The airline is also restructuring other operational aspects of the business to improve its operational and financial position. This facility has re-introduced PIA to the international financial markets, and has further strengthened our relationship with financial institutions in the region”.

Nadeem Lodhi, Managing Director & Citi Country Officer Pakistan said, “We are delighted on Pakistan International Airlines Corporation being able to successfully close the second commercially syndicated foreign currency financing within two years. The transaction is important for the aviation sector as it broadens the airline’s corporate credit to regional Islamic financiers despite challenging market conditions “.  PIA is the national flag carrier of Pakistan and covers over 30 international destinations across three continents. The airline also flies to over 20 domestic destinations.