PACRA Assigns Stability Rating to NBP Islamic Money Market Liquid Fund

NBP Islamic Money Market Liquid Fund ("NIMMLF" or "the Fund") is Low risk profile Fund. The objective of the Fund is to provide a stable income stream by investing in low risk and liquid Shariah Compliant authorized instruments. The Fund launched on 17th Sept, 2026. As of Sept ’26, NBP Islamic Money Market Liquid Fund (NIMMLF) had received IPO subscriptions of approximately PKR 16mln. The portfolio reflects the launch phase, with approximately 99.9% invested in Cash and the remaining allocation in other assets, including receivables. From a credit quality perspective, approximately 99.0% of assets were placed in AAA-rated avenues, 0.9% in AA- rated avenues and 0.1% in other assets, including receivables/payables. WAM stood at 1 day. The Fund’s AA+ rating is based on its intended investment design, which targets credit quality of AA+ and above, with a projected allocation of 30% in AAA, 50% in AA+ and 20% in AA rated instruments, and a WAM of around 40 to 50 days. The Fund intends to emphasize Ijarah Sukuk and short-term Sukuks relative to the existing NBP Funds product suite. The launch-phase holding in Cash and AAA-rated avenues is an interim position, while the rating reflects the intended portfolio profile. The assessment also considers the Fund’s investment policy, which permits Shariah-compliant government securities, cash and cash equivalents, Islamic bank placements, Shariah-compliant money market instruments and short-term Sukuks, subject to prescribed exposure limits and maturity requirements. Per management, counterparty diversification will remain in line with regulatory requirements. The Fund is envisaged to exceed PKR 5bn in size, targeting retail and corporate investors. The assessment draws support from NBP Funds, which carries an AM1 rating, reflecting its established track record, investment processes and risk controls. As the portfolio moves toward the stated mix, the AA allocation and a WAM of 40 to 50 days will introduce marginally greater credit and interest rate sensitivity. The current 1-day WAM and significant Cash allocation support redemption capacity in the interim. The top 10 investors account for approximately 96.1% of total holdings, consistent with the launch phase. Management expects this to moderate to around 20% to 30% post-launch. Until the investor base broadens, redemption patterns remain a liquidity consideration, while the Fund’s operating history and evidence of return stability will build as it matures. In terms of performance, the Fund delivered a return of 10.8%, outperforming the benchmark return of 9.7% and the peer average of 10.3%. The rating remains sensitive to alignment of the actual portfolio with the stated design, adherence to the WAM range and moderation in investor concentration.
Going forward, any material changes in the investment policy or the devised rating criteria for the assigned rating would have 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 595.6bln as of Sept '26, the Company manages a diversified portfolio of twenty-six open-end mutual funds, four voluntary pension schemes, and one exchange-traded fund (ETF).