The Pakistan Credit Rating Agency Limited
28-Dec-18
Analyst
Shahzaib Khalid
shahzaib.khalid@pacra.com
+92-42-35869504
www.pacra.com
Applicable Criteria
Related Research
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PACRA Maintains Stability Rating of MCB Cash Management Optimizer Fund
| Rating Type | Stability Rating | |
|
Current (28-Dec-18 ) |
Previous (30-Jun-18 ) |
|
| Action | Maintain | Upgrade |
| Long Term | AA+(f) | AA+(f) |
| Short Term | - | - |
| Outlook | Stable | Stable |
| Rating Watch | - | - |
Fund's investment objective is to provide unit-holders competitive returns from a low risk portfolio of short duration assets while maintaining high liquidity.
The rating reflects the fund's low risk profile emanating from its portfolio allocation towards low risk avenues. At end Jun-18, all of the funds assets were invested in cash (~100%) with banks rated AAA and AA+. The exposure with AAA banks was 95%, whereas, exposure with 'AA+' rated banks was ~5%. The minimal duration of the fund depicts that the fund is less susceptible to interest rate movements. The unit holding pattern of the fund emanates moderate liquidity risk as top ten investors represent ~56% of the fund's assets.
Going forward, the fund intends to maintain exposure in government securities and cash balances. The rating remains dependent on maintaining exposure with high credit quality instruments having credit ratings of 'AA' and above.
About
the Entity
MCB Arif Habib Savings and Investments Limited was incorporated in August 2000 and listed on the Karachi Stock Exchange. It is a major player in the mutual fund industry of Pakistan. During June'11, MCB Asset Management Company was merged into Arif Habib Investments. The objective was to achieve synergies in the asset management business and access a wider distribution network.
Company’s eight members board of directors comprises two representatives from MCB, two representatives from Arif Habib Group, one member is the CEO CEO and three are independent directors. Mian Muhammad Mansha, Chairman MCB, serves as the Chairman on the board. Mr. Saqib Saleem is the CEO, having work experience of over thirteen years. With overall assets under management of ~PKR 53bln at end Oct-18, the company is currently managing sixteen open-end funds and two voluntary pension funds.