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The Pakistan Credit Rating Agency Limited
Press Release

Date
18-Oct-19

Analyst
Afnan Iqbal
afnan.iqbal_old@pacra.com_old
+92-42-35869504
www.pacra.com

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Disclaimer
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 the Stability Rating of NAFA Government Securities Savings Fund.

Rating Type Stability Rating
Current
(18-Oct-19)
Previous
(18-Apr-19)
Action Maintain Maintain
Long Term AA-(f) AA-(f)
Short Term - -
Outlook Stable Stable
Rating Watch - -

The rating reflects the fund's strong credit profile emanating from its investment policy to invest at least 70% in Government Securities (PIBs, T‐bills) and
remaining investments will be in bank deposits and money market placements etc. At end‐Jun 19, 45.6% of the fund’s assets were invested in Government
securities. The remaining assets of the fund were invested with banks as banking deposits with majorly 'A+' and above. On monthly average basis, the duration
of the fund was 25 days in Jun‐19. The unit holding pattern of the fund is concentrated with top 10 investors representing 73% of the fund's assets, (of which
~33% 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 a monthly average basis.

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.

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.