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The Pakistan Credit Rating Agency Limited
Press Release

Date
28-Sep-22

Analyst
Madiha Sohail
madiha.sohail@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 Maintains Stability Rating of NBP Government Securities Savings Fund

Rating Type Stability Rating
Current
(28-Sep-22 )
Previous
(29-Mar-22 )
Action Maintain Maintain
Long Term AA-(f) AA-(f)
Short Term - -
Outlook Stable Stable
Rating Watch - -

NBP Government Securities Savings Fund(or the ‘Fund’) is a medium risk‐profile fund. The assigned rating reflects moderate strength of the fund's credit and interest rate risk profile. The Fund had allocated 31% of assets to bank placements mainly in 'AA+' banks, ~33.32% in T-Bills whereas ~33.9% in PIBs. The duration of the Fund stood at 183 days at the end Jun’22 (Dec’21: 203 days), exposing the fund to interest rate risk. The WAM of the Fund stood at 196 days at the end Jun’22 (Dec’21: 222 days), exposing the Fund to moderate credit risk due to investment in PIBs and Govt Securities credit risk is manageable. The top 10 investors possess a concentration of ~65.9% in the fund's total assets. Therefore, the fund is subject to moderate redemption pressure.
Going forward, material changes in the Fund's asset allocation strategy, impacting its credit quality and/or exposure to interest rate risk, would affect the rating.

About the Entity
NBP Fund Management Limited (or the "Company"), established in 2005, is licensed by Securities and Exchange Commission (SECP) to carry out asset management and investment advisory business. National Bank of Pakistan is the largest shareholder of the company with a stake of ~54%. In 2019, Baltoro Growth Fund has acquired the entire 36% stake of Alexandra Fund Management Private Limited in the Company. Baltoro Capital is a Pakistan focused private equity firm. Baltoro Capital has made investments in the pharmaceutical, renewable energy and financial services sectors in Pakistan. It is actively deploying its funds in businesses positioned to achieve extraordinary growth. The CEO of NBP Fund Management Limited, Dr. Amjad Waheed, CFA and family also holds a 10% stake in the company.
The Company’s nine-member Board of Directors includes three independent directors and the CEO. With overall assets under management of PKR 177,186mln at end-Jun'22, the Company is currently managing a diversified fund slate of twenty five open-end mutual funds, two voluntary pension schemes and one Exchange Traded Fund.

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.