KARACHI (PR) - The Pakistan Credit Rating Agency has downgraded the long-term entity rating of the Bank of Punjab (BoP) to "AA-" (Double A Minus), while maintaining the short-term rating at "A1+" (A One Plus). The rating action reflects the relative standing of BoP in the banking industry, wherein its peers have demonstrated better performance -in term of efficient systems and controls, core profitability and asset quality. Moreover, the recent growth in advances has exposed the overall loan book of the bank to a higher degree of concentration risk. On the other hand, the concentration in deposit base has also increased, which could put pressure on the liquidity management Although, the recent substantial provisioning against NPLs has diluted the risk absorption capacity of the bank, BoP still maintains a strong capital structure supplemented by sizeable revaluation surplus. The Government of Punjab majority shareholder of BoP -has recently nominated new members of the Board of Directors and an interim President, after dissolution of the previous board and removal of the President. The new BoD members are distinguished professionals including seasoned bankers, prominent industrialists and civil servants. The new BoD is planning to take several initiatives to streamline the bank's operations. However, owing to the institutional framework of BoP, the key shareholder can exert influence over the BoD that could potentially compromise its independence. Meanwhile, appointment of a new President and induction and retention of a resourceful and cohesive management team is crucial for the design and onwards implementation of the business strategy of the bank.