Lahore, March 22, 2018 (PPI-OT): The fund mandate is to generate return by investing in low risk short-term fixed instruments, to provide a reasonable return to investors while ensuring high liquidity. The rating reflects the fund’s low risk profile emanating from sizeable allocation of assets towards highly liquid, low credit risk avenues. At end-Dec-17, the portfolio comprised cash balances (66%) and bank placements (10%) with majority of Exposure with AA and above rated banks. The remaining assets of the fund (i.e. 24%) were invested in T-bills. Average duration of the fund at end Dec-17 stood at 20 days; maximum duration at a quarter end during CY17 was 37 days. The unit holding pattern of the fund is highly concentrated with the top 10 investors representing around 74% of portfolio.
Going forward, the fund intends to maintain investing strategy towards high liquidity and low credit risk mainly in form of AA rated banks and government securities with duration not exceeding 45 days. Material changes in the fund’s asset allocation strategy, which could negatively impact the fund’s credit quality and exposure to interest rate risk, remains critical for the rating. PACRA would monitor performance against agreed parameters on bi-annual basis.
For more information, contact:
The Pakistan Credit Rating Agency Limited (PACRA)
Awami Complex, FB1, Usman Block New Garden Town,
Lahore – Pakistan
Tel: +9242 586 9504 -6
Fax: +9242 583 0425