The Pakistan Credit Rating Agency Limited
10-Oct-24
Analyst
Hassaan Ahmad
Hassaan.Ahmad@pacra.com
+92-42-35869504
www.pacra.com
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Related Research
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PACRA Maintains Stability Rating of NBP Money Market Fund
| Rating Type | Stability Rating | |
|
Current (10-Oct-24 ) |
Previous (09-Apr-24 ) |
|
| Action | Maintain | Maintain |
| Long Term | AA(f) | AA(f) |
| Short Term | - | - |
| Outlook | Stable | Stable |
| Rating Watch | - | - |
NBP Money Market Fund (or the Fund) is a low-risk profile Fund. The objective of the Fund is to provide stable stream of income by investing in AA and above rated banks and money market instruments. The Fund's asset quality is good and is in line with the rating criteria at end Jun'24. As of the end of Jun'24. Fund's investments were ~90.2% in AAA/ Government Securities rated avenue, ~8.5% in AA rated avenue, with the reminder invested in other categories. At the end of Jun'24, most of investment was held in T-bills (~43%) followed by Bank Placements (~42%), Money Markets Placements (~8.5%), PIB’s (~5.9%) and remaining was invested in others. Both the duration and the WAM stood at 58 days and 59 days, respectively, at the end of June 2024, limiting the Fund's exposure to interest rate and credit risk. At the end of Jun'24, the top ten investor concentration stood at ~59.48%, exposing the Fund to high redemption pressure. To mitigate this risk, 90.2% of the Fund's assets are invested in AAA rated avenues.
Going forward, any material changes in the investment policy or the devised rating criteria for the assigned rating would have an impact on the ratings.
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.
The Company’s nine-member Board of Directors includes three independent directors and the CEO. With overall assets under management of PKR ~346bln at end-Jun'24, the Company is currently managing a diversified fund slate of twenty-six open-end mutual funds, four voluntary pension schemes and one Exchange Traded Fund.