PACRA Maintains the Stability Rating of MCB Pakistan Fixed Return Fund

MCB Pakistan Fixed Return Fund (“MCB PFRF” or “the Fund”) operates as a perpetual-duration, moderate risk-profile vehicle under the management of MCB Investment Management Limited, offering exposure exclusively through structured Allocation Plans, which may be either perpetual or carry fixed maturities. The Fund’s core objective is to deliver attractive, predefined fixed returns at plan maturity, primarily through strategic allocations to high-credit-quality Fixed Income Securities. Importantly, MCB PFRF is not directly accessible to retail investors; instead, it facilitates capital participation via dedicated Allocation Plans namely, Pakistan Fixed Return Plan 22, 23, and 24, all active as of March 2025. Each plan is structured to align with the Fund’s mandate of capital preservation and fixed return delivery, subject to investors maintaining their positions through maturity. The Management Company ensures return stability by investing within a carefully selected universe, primarily consisting of Government of Pakistan Treasury Bills and highly liquid cash equivalents. The Fund maintains a strong credit risk profile, with approximately 99.9% of its assets invested in sovereign-backed Treasury Bills and only about 0.01% held in cash deposits to manage liquidity needs. From a credit quality perspective, the entire portfolio is invested in high-grade instruments, with 100% exposure to AAA-rated, government-backed securities. This composition reinforces the Fund’s defensive positioning and supports minimal default risk. As of end-March 2025, the Fund reported a Weighted Average Maturity (WAM) of 114 days, indicating moderate sensitivity to interest rate movements while maintaining alignment with its short-to-medium duration investment strategy. This WAM profile reflects prudent duration management aimed at optimizing yield without introducing excessive interest rate or credit spread volatility.
Going forward, material changes in the Fund's asset allocation strategy, which could impact the Fund's credit quality and exposure to interest rate risk, would remain critical for the rating.

About the Entity
MCB Investment Management Limited (MCBIM) is a public listed company regulated by the Securities and Exchange Commission of Pakistan (SECP). It holds licenses for asset management, investment advisory, and pension fund management, catering to both Conventional and Shariah investment solutions. As of December 2024, MCBIM manages a diversified portfolio, including 26 Open-End Mutual Funds and 4 Voluntary Pension Schemes, while also maintaining a leading position in Separately Managed Accounts (SMA) and investment advisory services. MCBIM’s major shareholders include MCB Bank Limited (~81.42%), Adamjee Insurance Company Limited (~7.59%), and the general public (~9.28%). Mr. Khawaja Khalil Shah serves as the Chief Executive Officer of the company. The Board comprises a balanced composition of 4 Non-Executive Directors and 3 Independent Directors, ensuring robust governance, objective decision-making, and alignment with regulatory best practices. The Company’s assets under management (AUM) have grown significantly, reaching approximately PKR 588 Billion as of December 2024, reflecting its strong market presence and consistent growth in Pakistan’s asset management industry.