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The Pakistan Credit Rating Agency Limited
Press Release

Date
04-Dec-18

Analyst
Muhammad Usman
muhammad.usman@pacra.com
+92-42-35869504
www.pacra.com

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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 NAFA Money Market Fund

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

The fund's objective is to provide a stable income stream with the preservation of capital by investing in AA and above rated banks and money market instruments.

The rating reflects the fund's low-risk profile emanating from the fund's investment policy to invest in avenues rated 'AA' and above. At the end of  Jun-18, the asset allocation of the fund consisted of Bank Deposits 99%. The portfolio duration of the fund represents very low exposure towards interest rate volatility. The fund's unit holding pattern remains highly concentrated with the top 10 investors comprising 66% of the fund's net assets, which shows moderate redemption pressure over the fund.

Going forward, the rating remains dependent on maintaining exposure with high credit quality financial institutions with portfolio duration not exceeding 90 days. Meanwhile, the remaining assets of the fund must be placed with scheduled banks having credit ratings of 'AA' and above.

About the Entity
NBP Fund Management Limited (Formerly: NBP Fullerton Asset Management Limited), established in 2005, is licensed by Securities and Exchange Commission (SECP) to carry out asset management and investment advisory business. NBP is the largest shareholder of the AMC with a stake of ~54%, followed by Baltoro Growth Fund ~36% stake which they acquired from Alexandra Fund Management Pte. Ltd. The CEO of NBP Fund Management Limited, Dr. Amjad Waheed, also holds a 10% stake in the company.

The company’s nine-member Board of Directors include three independent directors and the CEO. During the year Mr. Mudassir Husain Khan and Mr. Tariq Jamali joined the company’s board as a Non-Executive director, both are the representatives of the bank. The company is currently managing a diversified fund slate of twenty-five funds.

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.