PACRA Maintains the Stability Rating of NBP Income Opportunity Fund.
|Rating Type||Stability Rating|
The rating reflects the fund's mandate to build a sizeable exposure to debt investments though of good quality. At end‐Jun 19, the total exposure stands at (34%) from financial and corporate sectors TFCs/Sukuks. Majority of the assets are deployed in cash balances and placements with good commercial banks (46%). The exposure with Government securities is merely around 0.37%, remaining assets portion is in commercial papers (16%). The unit holding pattern of the fund is moderatly concentrated with top 10 investors representing 42% of the fund's assets, (of which ~20% are owned investments) which exposes the fund to a low level of redemption pressure.
Going forward, the fund intends to maintain its current asset allocation. Material changes in the fund's asset allocation strategy, which could negatively
impact the fund's credit quality and exposure to interest rate risk, remain critical for the rating.
NBP Fund Management Limited, established in 2005, is licensed by Securities and Exchange Commission (SECP) to carry out asset management and investment advisory business. National Bank of Pakistan is the largest shareholder of the company with a stake of ~54%. During the year, Baltoro Growth Fund acquired the entire (36%) stake of Alexandra Fund Management Pte. Ltd. in the company. Baltoro Capital is a Pakistan focused private equity firm. Baltoro has made three investments in the pharmaceutical, renewable energy and financial services sectors. It is actively deploying its funds in businesses positioned to achieve extraordinary growth. 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 includes three independent directors and the CEO. During the year, there has been some new induction in the Board of Directors. The company is currently managing a diversified fund slate of thirty-four mutual funds and two pension funds.