PACRA Maintains Stability Rating of AWT Financial Sector Income Fund

The AWT Financial Sector Income Fund (“the Fund”) is characterized as a medium-risk investment vehicle engineered to deliver income enhancement and capital preservation through a disciplined allocation to financial sector instruments, including Term Finance Certificates (TFCs), Sukuk, bank deposits, and government securities. The Fund’s conservative liquidity management framework and its strategic focus on high-credit-quality assets support its profile as a reliable short-to-medium-term income solution, albeit with structural considerations related to its investor base. As of June 30, 2025, the Fund reported Assets Under Management (AUM) of PKR 294 million. In terms of asset class, 97% of net assets are allocated to bank deposits, ensuring instant liquidity access, while the remaining 3% is held in other instruments for diversified exposure. From a credit quality perspective, 92% of assets allocated to instruments rated ‘A+’ and a further 4% in ‘AAA’ rated securities. The interest rate risk profile is exceptionally conservative, anchored by a Weighted Average Maturity (WAM) of just one day. This ultra-short duration signifies negligible sensitivity to interest rate movements, ensures instant liquidity to meet investor redemptions, and prioritizes capital preservation amidst market volatility. As of Jun'25, the Fund's high investor concentration risk, with the top ten investors accounting for 68% of AUM. This concentration could amplify liquidity pressures in the event of correlated large-scale redemptions. However, this structural risk is substantially mitigated by the Fund’s short WAM and its overwhelming allocation to immediately realizable bank deposits, which provide a significant buffer against potential redemption shocks.
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
AWT Investments Limited (AWTIL) is a public unlisted company, incorporated in 2011, operating as a licensed Non-Banking Finance Company (NBFC) under the regulatory oversight of the Securities and Exchange Commission of Pakistan (SECP). As a wholly-owned subsidiary of Army Welfare Trust (AWT), the company is authorized to manage open-end and closed-end funds while providing comprehensive Investment Advisory Services. AWTIL is governed by a six-member Board of Directors, ensuring strong oversight and strategic direction. The company is led by Mr. Sajjad Anwar, Chief Executive Officer (CEO), a CFA charter holder with over 24 years of distinguished experience in Equity Research, Portfolio Management, Investment Advisory, Risk Management, and Finance & Accounts. Prior to joining AWTIL, Mr. Anwar served as Chief Investment Officer (CIO) at NBP Funds, bringing proven expertise and leadership in the asset management industry. AWTIL manages a diverse portfolio of funds, including both Conventional and Shariah-compliant investment solutions, catering to a broad spectrum of investor preferences. As of June 2025, the company’s Assets Under Management (AUM) surpassed PKR 63.6 billion, reflecting its strong market presence and disciplined investment approach. With a foundation built on transparency, regulatory compliance, and strategic asset allocation, AWT Investments Limited continues to strengthen its position as a trusted wealth management partner. The company remains dedicated to delivering sustainable returns, innovative financial solutions, and superior client service in Pakistan’s dynamic investment landscape.