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The Pakistan Credit Rating Agency Limited
Press Release

Date
18-Apr-19

Analyst
Shahzaib Khalid
shahzaib.khalid@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 Pak Oman Advantage Islamic Income Fund

Rating Type Stability Rating
Current
(18-Apr-19 )
Previous
(31-Dec-18 )
Action Maintain Maintain
Long Term A(f) A(f)
Short Term - -
Outlook Stable Stable
Rating Watch - -

The primary objective is to provide investor(s) with competitive current income and long term capital growth primarily by investing in a diversified portfolio of shariah compliant securities available for investment outside Pakistan subject to applicable laws.
The rating incorporates the fund's moderate risk asset allocation by investing ~46% of fund's assets as cash balances having minimum credit rating of 'A' at end Dec-18. ~10% investments are in 'AAA' rated and ~28% investments in 'AA' rated investment avenues at end Dec-18. Fund's exposure in Sukuks was 52% having minimum credit rating of 'A'. The weighted average maturity of the fund was 577 days and the duration was of 58 days at end Dec-18.

Going forward, the management of the fund intends maintain its exposure in debt instruments which may impact the duration. Meanwhile, the fund plans to remain invested in sound credit quality banks. 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.

About the Entity
Pak Oman Asset Management Company Limited was incorporated on July 28, 2006 as a public unlisted company. It is licensed by the Securities and Exchange Commission of Pakistan to carry out asset management and investment advisory services under the Non-Banking Finance Companies Regulations. The company is a majority owned subsidiary of Pak Oman Investment Company Limited (97%). The remaining shareholders include Oman International Development Company (1.2%), Bank Muscat (0.6%) and National Logistic Cell (1.2%).

The company’s Board of Directors comprise seven members including the managing director of Pak Oman Investment Company, Mr. Bahauddin Khan. The board’s chairman H.E. Yahya Bin Said Bin Abdullah Al-Jabri is the Minister of the Special Economic Zone Authority at A’Duqum, Sultanate of Oman. The company’s diverse product slate includes eleven open-end funds as at Feb'19 belonging to all major categories. Pak Oman has four open-end funds under its name, while seven open-end funds belonged to Askari Investment Management Limited which were acquired by Pak Oman Asset Management Company.

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.