Broker Fiduciary Rating Assessment Framework

The Pakistan Credit Rating Agency
Broker Fiduciary Rating
Criteria
Assessment Framework
Table of Contents
Introduction ................................................2
Rating Framework ......................................2
Profile..........................................................3
Ownership ..................................................4
Governance ................................................5
Management & Client Services ..................6
Internal Controls & Regulatory Compliance8
Business Sustainability ..............................9
Financial Sustainability ............................11
Summary
Broker Fiduciary Rating represents PACRA’s opinion on the relative management quality, customer service, and sustainability of operations of a broker. PACRA arrives at an opinion after a detailed evaluation of several qualitative and quantitative factors. However, PACRA’s approach is more skewed towards the qualitative aspect when assigning a Fiduciary Rating to brokers. This document outlines our general approach to assigning a fiduciary rating to a broker and the factors that are likely to influence rating outcomes. This methodology applies to brokers licensed to undertake securities broker activity under the Securities Act of 2015 and permitted to undertake futures broker activity for futures contracts based on securities and financial instruments, as per Section 52 of the Futures Market Act of 2016. Analyst Contacts:
Muhammad Danish Nadeem
+92-42-3586 9504 danish.nadeem@pacra.com
The Pakistan Credit Rating Agency Limited:
Head Office
FB1 Awami Complex
Usman Block, New Garden Town
Lahore
Phone +92 42 3586 9504
Karachi Office
169/1, Street No-21.
Khyaban-e-Qasim,
DHA Phase-8, DHA, Karachi
Phone +92 346-2578624
Disclaimer: PACRA has used due care in preparation of this document. Our information has been obtained from sources we consider to be reliable but its accuracy or completeness is not guaranteed. PACRA shall owe no liability whatsoever to any loss or damage caused by or resulting from any error in such information. Contents of PACRA documents may be used, with due care and in the right context, with credit to PACRA. Our reports and ratings constitute opinions, not recommendations to buy or to sell.