PACRA Maintains Stability Rating of Alhamra Islamic Income Fund (formerly: MCB Islamic Income Fund)
|Rating Type||Stability Rating|
Fund's investment objective is to generate risk adjusted returns by investing in short, medium and long-term shariah compliant fixed income instruments.
The rating incorporates the fund's moderate credit quality and liquidity profile emanating from the fund's policy to invest only in good quality Shariah compliant instruments. At end Jun-18, ~72% were invested with banks as cash balances, while 25% of the fund's net assets were invested with sukuks having minimum 'A' credit rating. Fund's exposure of 36% with 'AAA' and 13% with 'AA' rating shows the good credit quality of the portfolio. The fund has moderately diversified unit holding pattern, with top ten investors representing ~60% of the fund size.
Going forward, the fund intends to maintain its exposure towards bank placements with rest of the fund's assets invested in shariah compliant commercial papers and other debt securities. Material changes in the fund's asset allocation strategy, which could negatively impact the fund's credit quality and exposure to interest rate risk, remains critical for the rating.
MCB Arif Habib Savings and Investments Limited was incorporated in August 2000 and listed on the Karachi Stock Exchange. It is a major player in the mutual fund industry of Pakistan. During June'11, MCB Asset Management Company was merged into Arif Habib Investments. The objective was to achieve synergies in the asset management business and access a wider distribution network.
Company’s eight members board of directors comprises two representatives from MCB, two representatives from Arif Habib Group, one member is the CEO CEO and three are independent directors. Mian Muhammad Mansha, Chairman MCB, serves as the Chairman on the board. Mr. Saqib Saleem is the CEO, having work experience of over thirteen years. With overall assets under management of ~PKR 53bln at end Oct-18, the company is currently managing sixteen open-end funds and two voluntary pension funds.