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The Pakistan Credit Rating Agency Limited
Press Release

Date
18-Oct-21

Analyst
Madiha Sohail
madiha.sohail@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 NBP Islamic Money Market Fund

Rating Type Stability Rating
Current
(18-Oct-21)
Previous
(16-Apr-21)
Action Maintain Maintain
Long Term AA(f) AA(f)
Short Term - -
Outlook Stable Stable
Rating Watch - -

NBP Islamic Money Market Fund (or the "Fund") is a low risk profile fund. The Investment Policy enforces a minimum requirement of 10% on the total investment in Cash and Cash equivalents. At end June'21, the Fund had invested 77.1% of the total Fund's assets in Banks mostly rated "AA+" and above. Furthermore, short term sukuks constituted towards 9.3% of the total Fund's assets in corporates ranked 'AA+'. Moreover, the Fund does well to keep its average duration at 16 days (At end Jun'21) and therefore, minimizes its exposure to interest rate risk. The unit holding pattern is adequateconcentrated, with top 10 investors contributing towards 43.68% of the total Fund's assets and therefore subjects the Fund to a moderate level of redemption pressure. However, the highly liquid nature of the Fund provides a reasonable cushion against this risk.
Going forward, in accordance with the investment policy the fund intends to maintain its current asset allocation. Material changes in the fund's asset allocation will impact the rating.

About the Entity
NBP Fund Management Limited (or the "Company"), 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%. In 2019, Baltoro Growth Fund has acquired the entire 36% stake of Alexandra Fund Management Private Limited in the Company. Baltoro Capital is a Pakistan focused private equity firm. Baltoro Capital has made investments in the pharmaceutical, renewable energy and financial services sectors in Pakistan. It is actively deploying its funds in businesses positioned to achieve extraordinary growth. The CEO of NBP Fund Management Limited, Dr. Amjad Waheed, CFA and family also holds a 10% stake in the company.
The Company’s nine-member Board of Directors includes three independent directors and the CEO. With overall assets under management of PKR 168,016mln at end-Jun'21, the Company is currently managing a diversified fund slate of twenty eight open-end mutual funds, two voluntary pension schemes and an Exchange Traded Fund.

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.