PACRA Maintains Stability Rating of Alhamra Islamic Money Market Fund (Formerly: MCB Pakistan Frequent Payout Fund)
|Rating Type||Stability Rating|
Alhamra Islamic Money Market Fund (or the ‘Fund’) is low risk-profile fund. The Fund’s rating reflects the Fund's strong credit and interest rate risk profile emanating from its investment strategy. At end Jun'21, the Fund had placed ~46% of its assets with commercial banks rated 'AA' and 'AAA'. The Fund had placed 42% of its net assets in Shariah Compliant bank placements and deposits. It had also invested ~8% of its funds in Shariah Compliant commercial papers. The weighted average maturity of the Fund was 35 days at end_Jun’21, which is in compliance with the investment policy. The duration of the fund remained within 45 days as at end-Jun'21. The Benchmark return of Fund will be the 3-month average deposit rate of 3 'AA' rated Islamic banks/Islamic windows of conventional banks. The Fund outperformed the benchmark during FY21 by a comfortable margin of 334 basis points. At end-Jun'21, the the fund's unit holding pattern was highly concentrated with top ten investors representing ~91% of the net assets; however, the highly liquid nature of Fund's assets is able to cope up the redemption pressure.
Going forward, the Fund will invest in accordance with its authorized investment policy and maintain its exposure in Shariah Compliant instruments, however the allocations will be diversified appropriately. Material changes in the Fund's asset allocation strategy, impacting it's credit quality and/or exposure to interest rate risk, would affect the rating.
MCB-Arif Habib Limited Savings and Investments Limited (MCB-AH or the "Company") is a public listed company, regulated by the SECP. MCB-AH holds licenses for Asset Management, Investment Advisory, and Pension Fund Management. MCB-AH was incorporated in 2000 as Arif Habib Investments Limited and subsequently merged with MCB Asset Management Company in 2011, to achieve synergies in asset management business and access to a wider distribution network. Pursuant to the merger, the name of the Company was changed to MCB-Arif Habib Savings and Investments Limited. MCB-AH caters to both conventional and Shariah-compliant clientele and is currently managing a diverse product slate of fifteen open-end funds and two voluntary pension schemes. MCB-AH is also managing one of the largest AUMs under the SMA segment and holds a significant position in the investment advisory domain.
The major shareholders of MCB-AH are MCB Bank Limited ~51%, Arif Habib Corporation Limited ~30%, and Adamjee Insurance Company Limited ~8%. The general public holds the remaining ~11% of the shares. MCB-AH's control vests in an eight-member board of directors, including the CEO. There are four non-executive directors, while three directors are independent. The AUMs (CIS & VPS) of MCB-AH increased to ~PKR 97,679mln at end-Jun'21 (Dec'20: ~PKR.82,721mln).