The Pakistan Credit Rating Agency Limited
02-Mar-23
Analyst
Madiha Sohail
madiha.sohail@pacra.com
+92-42-35869504
www.pacra.com
Applicable Criteria
Related Research
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PACRA Maintains Stability Rating of Alhamra Islamic Money Market Fund
| Rating Type | Stability Rating | |
|
Current (02-Mar-23 ) |
Previous (02-Sep-22 ) |
|
| Action | Maintain | Maintain |
| Long Term | AA+(f) | AA+(f) |
| Short Term | - | - |
| Outlook | Stable | Stable |
| Rating Watch | - | - |
Alhamra Islamic Money Market Fund (or the ‘Fund’) is low risk-profile fund. The Fund’s rating reflects the strong credit and interest rate risk profile emanating from its investment strategy. The Fund had invested ~75.2% of its assets with commercial banks rated AA and above, ~16% in Shariah Compliant bank placements and deposits, ~3.9% in Short Term Sukuk, ~3.5% in Shariah Compliant Certificate Musharika while remaining was invested in other Receivables at end Dec'22. The weighted average maturity of the Fund was 8 days at end-Dec’22, limiting the exposure to the credit risk. The top ten investors concentration stood at ~94% at end-Dec’22, representing a high level of redemption pressure, which the Fund is able to cope up owing to its superior liquidity profile.
Going forward, the Fund will invest in accordance with its authorized investment policy and maintain its exposure in Shariah Compliant instruments, however the allocations will be diversified appropriately. Material changes in the Fund's asset allocation strategy, impacting it's credit quality and/or exposure to interest rate risk, would affect the rating
About
the Entity
MCB-Arif Habib Limited Savings and Investments Limited (MCB-AH or the "Company") is a Public Listed Company, regulated by the SECP. MCB-AH holds licenses for Asset Management, Investment Advisory, and Pension Fund Management. MCB-AH caters to both conventional and Shariah-compliant clientele and is currently managing a diverse product slate of eighteen open-end funds and two voluntary pension schemes. MCB-AH is also managing one of the largest AUMs under the SMA segment and holds a significant position in the investment advisory domain.
The major shareholders of MCB-AH are MCB Bank Limited ~51%, Arif Habib Corporation Limited ~30%, and Adamjee Insurance Company Limited ~8%. The general public holds the remaining ~11% of the shares. Mr. Saqib Saleem is the CEO of the company. MCB-AH's control vests in an eight-member board of directors, including the CEO. There are four non-executive directors, while three directors are independent. The AUMs (CIS & VPS) of MCB-AH increased to PKR 160bln at end-Dec'22 (Jun'22: PKR 122bln).