The Pakistan Credit Rating Agency Limited
18-Apr-25
Analyst
Usama Ali
usama.ali@pacra.com
+92-42-35869504
www.pacra.com
Applicable Criteria
Related Research
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PACRA Maintains Stability Rating of NBP Islamic Savings Fund
| Rating Type | Stability Rating | |
|
Current (18-Apr-25 ) |
Previous (20-Sep-24 ) |
|
| Action | Maintain | Maintain |
| Long Term | AA-(f) | AA-(f) |
| Short Term | - | - |
| Outlook | Stable | Stable |
| Rating Watch | - | - |
NBP Islamic Savings Fund ('NISF' or the 'Fund') is a moderate risk-profile fund. The investment objective of the Fund is to earn a reasonable rate of return in a Shariah compliant manner by investing primarily in Shariah compliant money markets instruments and bank deposits. The assigned rating reflects the Fund's low credit and interest rate risk profile emanating from its investment strategy. In terms of asset class, the Fund had allocated ~37.6% in Baii Muajjal Placements, ~31.8% as Bank Deposit/ Cash, ~13.1% as Certificate of Musharika, ~8.3% as Short Term Sukuks, ~4.6% as Placement with Banks and DFIs (Islamic) at the end-Dec'24. In the perspective of credit quality the Fund had invested ~37.4% in AA+ rated avenues, ~21.3% in AAA, ~13% in AA, ~11.9% in A+, and the remaining in other rated avenues. The WAM of the Fund stood at 28 days at the end Dec'24, limiting the interest rate risk and credit risk of the Fund. The Duration of the Fund stood at 31 days, at the end Dec'24. At the end of Dec'24, the top ten investor concentration stood at ~34.61%, exposing the Fund to moderate redemption pressure.
Going forward, any material changes in the investment policy or the devised rating criteria for the assigned rating would have an impact on the ratings.
About
the Entity
NBP Fund Management Limited (the "Company"), established in 2005, is licensed by the Securities and Exchange Commission of Pakistan (SECP) to carry out asset management and investment advisory services. The National Bank of Pakistan is the largest shareholder of the company, with a ~54% stake, followed by Baltoro Growth Fund (~36%) and individual investors (~10%). The CEO of NBP Fund Management Limited, Dr. Amjad Waheed, CFA, has over 25 years of experience in mutual funds and portfolio management. The Company’s eight-member Board of
Directors includes three independent directors and the CEO. With total assets under management of ~PKR 575bln as of December 2024, the Company manages a diversified portfolio of twenty-six open-end mutual funds, four voluntary pension schemes, and one exchange-traded fund (ETF).