JCR-VIS reaffirms Management Quality Rating of Allied Bank Ltd Asset Management Company Limited

Karachi, December 31, 2014 (PPI-OT): JCR-VIS Credit Rating Company Ltd. (JCR-VIS) has reaffirmed the Management Quality Rating of ABL Asset Management Company Limited (ABL AMC) at ‘AM2’ (AM-Two) with a ‘Stable’ Outlook. The previous rating action was announced on June 21, 2013.

ABL AMC is a wholly owned subsidiary of Allied Bank Limited (ABL). The management team of ABL AMC has depicted stability; personnel at the senior management level possess the necessary skill set to deliver on the company’s goals.

Risk and compliance functions at ABL AMC are merged with a dedicated resource for each area. The team may need to be built as the company forges ahead with its growth plans. Recent developments on the operations side include outsourcing of some back office operations to a third party vendor.

After launching two principal protected funds; the company has also launched pension funds in 2014. There is also growth in the number of retirement mandates being managed by the company, with specific growth targets assigned for the same as well.

In relation to peers, the performance of income and money market funds remain competitive; funds holding long term government paper have benefited from the movement in market rates. Over a five years period, the conventional stock fund is ranked MFR 4-Star depicting strong performance.

The return of recently launched Islamic stock fund does not compare favorably to peers. As the portfolio of assets under management continues to increase, the management’s ability to deliver consistent results across product lines will continue to be tracked by JCR-VIS.

The organization uses the Global Investment Performance Standards (GIPS®) for disclosure of its performance results; which is considered positive in view of increasing number of separately managed accounts.

In 2014, market share of the company increased to 6.8%. A multi-pronged distribution strategy utilizing in-house sales team, parent’s branches and third party distributors, is aimed at enhancing the company’s retail penetration as the same is lower in relation to peers.

Additional resources are being hired by ABL AMC to reach out to its target market. In addition to the development of in-house sales team, progress has also been made in setting up dedicated sales offices, that are to be housed in the parent bank’s branches. JCR-VIS will continue to monitor the results of these initiatives.

For more information, contact:
Ms. Sobia Maqbool
CFA
JCR-VIS Credit Rating Company Limited
VIS House, 128/C,
25th Lane off Khayaban-e-Ittehad,
Phase VII, DHA, Karachi
Tel: +92-21-35311861-72
Fax: +92-21-35311873
Email: sobia@jcrvis.com.pk

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