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The Pakistan Credit Rating Agency Limited
Press Release

Date
14-Dec-22

Analyst
Wajeeha Asghar
wajeeha.asghar@pacra.com
+92-42-35869504
www.pacra.com

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This press release is being transmitted for the sole purpose of dissemination through print/electronic media. The press release may be used in full or in part without changing the meaning or context thereof with due credit to PACRA

PACRA Assigns Initial Rating to UBL Special Savings Plan – V under UBL Special Savings Fund (USSP-V)

Rating Type Capital Preservation Rating
Current
(14-Dec-22 )
Action Initial
Long Term CP2+
Short Term -
Outlook Stable
Rating Watch -

UBL Special Savings Fund (or the "Fund") is an open-end and low-risk profile. The Fund aims to provide a competitive regular return with capital preservation on holding of investment for specified duration and beyond in plan(s) accordingly. The Fund shall offer multiple Allocation Plans, hereafter, investing in authorized investable avenues. The undermentioned plans are currently offered under the Fund: i) UBL Special Savings Plan- I (USSP-I) ii) UBL Special Savings Plan- II (USSP-II) iii) UBL Special Savings Plan- III(USSP-III) iv) UBL Special Savings Plan- IV (USSP-IV) v) UBL Special Savings Plan-V (USSP-V) and vi) UBL Special Savings Plan-VI (USSP-VI). The duration of the Fund is perpetual; however, Allocation Plans launched underline may have a fixed maturity or could be perpetual as well.
UBL-Special Savings Fund Plans-V (USSP-V) is an open-ended capital-protected plan where risk of principal erosion is at low. The objective is to provide a competitive regular return with capital preservation for unit holders who hold their investment for thirty six (36) Months from commencement of life of plan. The term of the Fund is perpetual. According to investment policy, the plan can invest in PIBs, TDRs and T-bills which is a highly liquid and cannot invest below double AA-rated avenues. The top ten party concentration of the plan is at ~99.7% as end Sep'22, the majority is invested by HNWIs.
Currently, the plan had invested ~57% in single bank rated AA- and ~42.6% in T-bills in the end sep-22. The duration of the Plan was 1-day, limiting the exposure to interest rate risk whereas the WAM of the Fund was 61-days due to investment in T-bills however credit risk is manageable due to investment in govt securities. Capital preservation will be provided for 36 months and beyond, After 36 months capital preservation feature remain intact and only open for subscription for limited period on approval of Commission. However, redemption will be allowed without contingent load on completion of capital preservation period. Going forward, the plan is intended to invest a minimum 25% in Govt securities.
Any material changes in the investment policy or the devised rating criteria for the assigned rating would have an impact on the rating

About the Entity
UBL Fund Managers Limited, incorporated in 2001 as a public unlisted company, is one of the leading Asset Management and Investment Advisory company in Pakistan. It is licensed by the Securities and Exchange Commission of Pakistan (SECP) to carry out these services under the Non-Banking Finance Companies Regulations. The Company is ~98% owned by United Bank Limited, while the remaining stake belongs to individuals. The Company’s Board of Directors comprises seven members including the CEO. The CEO, Mr. Yasir Qadri, is associated with the asset management industry for more than twenty years. The board’s Chairman, Mr. Azhar Hamid, is a banker having more than four decades of banking experience. The Company’s diverse product slate includes 13 conventional funds and 9 shariah compliant funds as at end Jun'22 belonging to all major categories. The Company is also offering two voluntary pension schemes in the conventional and shariah compliant category. The assets under management stood at ~PKR 131bln at end Sep'22.

The primary function of PACRA is to evaluate the capacity and willingness of an entity to honor its obligations. Our ratings reflect an independent, professional and impartial assessment of the risks associated with a particular instrument or an entity. PACRA's comprehensive offerings include instrument and entity credit ratings, insurer financial strength ratings, fund ratings, asset manager ratings and real estate gradings. PACRA opinion is not a recommendation to purchase, sell or hold a security, in as much as it does not comment on the security's market price or suitability for a particular investor.