logo
The Pakistan Credit Rating Agency Limited
Press Release

Date
30-Jun-18

Analyst
Ayesha Qasim
ayesha.qasim@pacra.com
+92-42-35869504
www.pacra.com

Applicable Criteria

Related Research

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 Stability Rating of JS Islamic Income Fund (formerly: JS Islamic Government Securities Fund)

Rating Type Stability Rating
Current
(30-Jun-18 )
Previous
(12-Jul-17 )
Action Maintain Maintain
Long Term AA-(f) AA-(f)
Short Term - -
Outlook Stable Stable
Rating Watch - -

The investment mandate of the fund is to generate stable return for its unit holders while ensuring capital preservation by primarily investing in Shariah compliant government securities.

At end-Dec17, fund's exposure with TFCs/Sukuks was 16% rated ‘AAA’, while remaining assets 84% were kept with banks rated 'A+'. Weighted average maturity of the fund remain at 246 days. The unit holding pattern of the fund is highly concentrated with top10 investors representing 99% of the fund's assets, (of which ~10% are owned investments) which exposes the fund to a high level of redemption pressure.

Going forward, the fund intends to maintain exposure towards debt instruments and cash balances. Material changes in the fund's asset allocation strategy, which could negatively impact the fund's credit quality and exposure to interest rate risk, remains critical for the rating. PACRA would monitor performance against agreed parameters on monthly average basis.

About the Entity
Incorporated in 1995 and listed on PSX since April 24, 2007, JS Investments Limited is a private sector asset management company in Pakistan. It is a subsidiary of JS Bank Limited - 65% shareholding at end-Dec17. JS Bank, has a country-wide network of 323 branches (at end-Dec17). It carries a long-term rating of "AA-" and short-term rating of "A1+" by PACRA. JS Investments is managing 13 open-end mutual funds and 2 pension schemes with collective AUMs of PKR 12,316mln at end-Dec-17.

JS Investment’s board of directors comprises eight members - including CEO. The board structure include two group representatives, four representatives of the sponsoring bank and an independent director. The CEO Mr. Hasnain Raza Nensey, has an aggregate work experience of over two decades, mainly in the Financial Industry in Pakistan.

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.