The Pakistan Credit Rating Agency Limited
16-Oct-20
Analyst
Afnan Iqbal
afnan.iqbal_old@pacra.com_old
+92-42-35869504
www.pacra.com
Applicable Criteria
Related Research
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PACRA Maintains Stability Rating of NIT Money Market Fund
| Rating Type | Stability Rating | |
|
Current (16-Oct-20 ) |
Previous (17-Apr-20 ) |
|
| Action | Maintain | Maintain |
| Long Term | AAA(f) | AAA(f) |
| Short Term | - | - |
| Outlook | Stable | Stable |
| Rating Watch | - | - |
The rating reflects the strong strength of the fund's credit and interest rate risk profile. The fund's good credit quality and sound liquidity profile emanates primarily from its mandate to invest in government securities and other low duration avenues such as bank placement's and ensuring low exposure to interest rate risk. At end Jun'20, ~62% of fund's assets were allocated to banks, whereas ~37% exposure was maintained with T-Bills and 1.8% of funds were invested in commercial paper. Average duration of the fund remained within 45 days. Fund's unit holding pattern is highly concentrated with top 10 investors representing 73% of the net assets.
Going forward, the fund intends to maintain its asset allocation towards higher rated banks. Material changes in the fund's asset allocation strategy, impacting its credit quality and/or exposure to interest rate risk, would affect the rating.
About
the Entity
National Investment Trust Limited was established in 1962 as an unquoted public limited company. It is the first asset management company of Pakistan and is the pioneer of domestic mutual fund industry. The Company’s Board of Directors currently comprises ten board members out of which nine are non-executive. Mr. Adnan Afridi has been appointed as the Managing Director of the Company in Feb-19. The authority for appointment of CEO/Managing Director lies with the Government of Pakistan.
Mr. Adnan Afridi holds profound experience in the financial services and capital markets. Mr. Manzoor Ahmed is the COO and has a successful track record of managing the operations and investment portfolio of the Company. They are supported by a team of qualified and experienced professionals. The Company is currently one of the largest asset management companies in Pakistan with a portfolio of five conventional funds, two shariah-compliant funds and two pension funds. The assets under management of the Company stood at ~PKR 76bln (including SEF & EMOF) at end-Jun'20. The Company also launched an exchange traded fund during CY20.