PACRA Maintains Stability Rating of NIT Government Treasury Fund
|Rating Type||Stability Rating|
The objective of the fund is to ensure a high level of portfolio liquidity, while maintaining a portfolio composition which yields returns in excess of the benchmark. The rating reflects the fund's low risk profile emanating from its policy to invest in avenues rated 'AA' and above. At end-May17, 81% of the fund's exposure was in Government securities and the remaining portfolio was invested as cash (i.e. 19%) with "AA+" rated avenues. Monthly average exposure in Government securities and durations largely remained on the defined parameters. Fund's exposure in Government securities was above 78% in past 5 months. The unit holding pattern of the fund is highly concentrated with top10 investors representing almost the entire fund, which reflects redemption risk.
Going forward, the rating remains dependent on maintaining at least 50% allocation towards government securities or AAA exposure on monthly average basis with portfolio duration not exceeding 60 days. Meanwhile, the remaining assets of the fund must be placed with investment avenues having credit ratings of 'AA' and above. PACRA would monitor compliance against pre-defined parameters on monthly average basis.
NIT is the first asset management company of Pakistan, formed in 1962. The Government of Pakistan (GoP) directly and indirectly through government owned entities is major shareholder (41.65%) in the company. Other shareholders comprise prominent businessmen and commercial banks having shareholding of 8.33% each. These shareholders are represented by a board of ten directors. The company is currently the largest asset management company in Pakistan with a portfolio of seven open end funds & two pension funds. The open end funds has an AUM base of ~PKR 107bln at end-May17. The company operates the country's largest equity fund - NI(U)T - (fund size of ~PKR 92bln at end May-17.)
The Managing Director, Mr. Shahid Ghaffar, holds profound experience in the domestic mutual fund industry. He is supported by a team of qualified and experienced professionals.