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The Pakistan Credit Rating Agency Limited
Press Release

Date
30-Jun-18

Analyst
Muhammad Usman
muhammad.usman@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 Pak Oman Government Securities Fund

Rating Type Stability Rating
Current
(30-Jun-18)
Previous
(12-Jul-17)
Action Maintain Maintain
Long Term A+(f) A+(f)
Short Term - -
Outlook Stable Stable
Rating Watch - -

The rating reflects the fund's strong credit quality and a sound liquidity profile emanating from the fund's policy to invest 70% of asset in a mix of short-term and long-term government securities. At end-Dec17, 71% of the fund's exposure was in short term Government securities (T-bills) and the remaining portfolio was invested in TFCs (i.e. 18%) with "A+" and above rated avenues. On average basis, fund’s duration was below 2 years in the last quarter. The unit holding pattern of the fund is concentrated with top10 investors representing 100% of the fund's assets, (of which ~90% are owned investments) which exposes the fund to a low level of redemption pressure.
Going forward, the rating remains dependent on maintaining at least 70% allocation towards government securities with portfolio duration not exceeding 2 years. PACRA would monitor compliance against agreed parameters on the monthly average basis.

About the Entity
Pak Oman Asset Management Company Limited was incorporated on July 28, 2006 as a public unlisted company. It is licensed by the Securities and Exchange Commission of Pakistan (SECP) to carry out asset management and investment advisory services under the Non-Banking Finance Companies Regulations. During the year, the company remained a majority owned subsidiary of Pak Oman Investment Company Limited (97%). The remaining shareholders include Oman International Development Company (1.2%), Bank Muscat (0.6%) and National Logistic Cell (1.2%).

The company’s Board of Directors (BoD) currently comprise eight members including the CEO, Mr. Adeel Ahmad Khan. The board’s chairman H.E. Yahya Bin Said Bin Abdullah Al-Jabri belongs to the Omanian royal family. The company’s diverse product slate includes eleven open-end funds as at March-18 belonging to all major categories. Pak Oman has four open-end funds under its name, while seven open-end funds belonged to Askari Investment Management Limited which have now been acquired by Pak Oman.

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.