Analyst
Afnan Iqbal
afnan.iqbal_old@pacra.com_old
+92-42-35869504
www.pacra.com
Applicable Criteria
Related Research
PACRA Maintains the Stability Rating of NBP Active Allocation Riba Free Savings Fund.
Rating Type | Stability Rating | |
Current (18-Oct-19 ) |
Previous (18-Apr-19 ) |
|
Action | Maintain | Maintain |
Long Term | A-(f) | A-(f) |
Short Term | - | - |
Outlook | Stable | Stable |
Rating Watch | - | - |
Currently, 'NAFA Islamic Active Allocation Plan I', 'NAFA Islamic Active Allocation Plan II', 'NAFA Islamic Active Allocation Plan III', ‘NAFA Islamic Active Allocation Plan IV’, ‘NAFA Islamic Active Allocation Plan V’, ‘NAFA Islamic Active Allocation Plan Vl’, ‘NAFA Islamic Active Allocation Plan Vll’ and ‘NAFA Islamic Active Allocation Plan VIll’ have invested their fixed income portions in this fund. The unit holding pattern of these plans combined is highly concentrated with top 10 investors contributing 100% to the plans. Fund has (34%) exposure in banking deposit with 'A‐' rated bank, 'A+' rated bank (28%), and 'AA‐' rated bank (2.42%) at end‐Jun 19.
Going forward the fund intends to maintain 70 % of its exposure in bank deposits while 10% would be in commercial papers. 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.
About
the Entity
NBP Fund Management Limited, 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%. During the year, Baltoro Growth Fund acquired the entire (36%) stake of Alexandra Fund Management Pte. Ltd. in the company. Baltoro Capital is a Pakistan focused private equity firm. Baltoro has made three investments in the pharmaceutical, renewable energy and financial services sectors. It is actively deploying its funds in businesses positioned to achieve extraordinary growth. The CEO of NBP Fund Management Limited, Dr. Amjad Waheed, also holds a 10% stake in the company.
The company’s nine-member Board of Directors include three independent directors and the CEO. During the year, there has been some new induction in the Board of Directors. The company is currently managing a diversified fund slate of thirty-four mutual funds and two pension funds.