PACRA Assigns Initial Capital Preservation Rating to Faysal Special Saving Fund

Faysal Special Saving Fund ("FSSF" or the "Fund") reflects the Fund's moderate risk profile. “Faysal Special Savings Fund” is an open-end Capital Protected Fund that aims to provide a competitive regular return with capital preservation on Investments as per respective Allocation Plans by investing in authorized investable avenues in line with the risk tolerance of the Investor. It shall offer Units on a continuous basis during and after the -Pre-IPO & IPO Period; however, term-based plans may be offered for a limited subscription period. At the end of Dec'23, ~88.6% of funds assets were allocated to Gov. Securities & banks Primarily rated 'AAA', AA, and AA-. While the average duration of the Fund(including all plans) is 36 days, at the end of Dec'23 limiting the fund's exposure to interest rate risk. The average WAM of the fund(including all plans) stood at 552 days limiting the fund's exposure to credit risk. The Fund's unit holding pattern remains moderately concentrated with the top 10 investors comprising ~86.7% of the Fund's net assets equally distributed, keeping redemption pressure to a high level. The Fund includes 3 plans, 1) Faysal Special Saving Plan-1 (FSSP-I), 2) Faysal Special Saving Plan-2 (FSSP-II), and 3) Faysal Special Saving Plan-3 (FSSP-III). The "FSSP-I" is a perpetual Allocation Plan. At the end of Dec'23, ~80% of funds assets were allocated to banks Primarily rated 'AAA', AA, and AA-. The WAM and duration of the fund stood at 1 day as of Dec'23; the credit risk and interest risk are minimal. The plan unit holding pattern is highly concentrated with the top 10 investors representing ~93% of the net assets, which exposes the fund to a high level of redemption pressure. The “FSSP-II” is a perpetual Allocation Plan. At the end Dec'23, ~99.18% of funds assets were allocated to Gov. Securities & banks Primarily rated 'AAA', AA, and AA-. The WAM of the plan stood at 1,654 days as of Dec'23 exposing high credit risk. However, the plan has invested 92% in PIB's therefore, the credit risk is manageable. The duration of the plan remained 105 days, at the end of Dec'23, hence exposing low interest rate risk. The plan unit holding pattern is highly concentrated with the top 10 investors representing ~99% of the net assets, which exposes the plan to a high level of redemption pressure. The “FSSP-III” is a perpetual Allocation Plan. At the end of Dec'23, ~92.46% of funds assets were allocated to banks Primarily rated AA and AA-.The WAM and duration of the fund stood at 1 day as of Dec'23; the credit risk and interest risk are minimal. The plan unit holding pattern is highly concentrated with top 10 investors representing ~68% of the net assets, which exposes the fund to medium level of redemption pressure.
Going forward, 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
Faysal Funds was incorporated in Pakistan under the Companies Ordinance, 1984 on August 6, 2003 as an unlisted public limited company and is licensed by the Securities and Exchange Commission of Pakistan to carry out asset management and investment advisory services. Faysal Funds is a subsidiary of Faysal Bank Limited (FBL). FBL holds 99.99% shares of Faysal Funds. The Company is managing a diversified portfolio of funds, with AUMs of ~PKR 133.8bln at the end of Dec'23.