PACRA Maintains Stability Rating of NIT Government Bond Fund

The NIT Government Bond Fund (the "Fund") is characterized as a low-risk, fixed-income collective investment scheme, engineered to generate optimized returns through a strategic and concentrated allocation to Government of Pakistan (GoP) debt securities. The Fund's institutional-scale operations and sovereign-dominant portfolio composition support its profile as a core fixed-income allocation vehicle; however, a highly concentrated investor base necessitates strong and proactive liquidity management frameworks. As of June 30, 2025, the Fund reported Assets Under Management (AUM) of PKR 13.40 billion, underscoring its material presence within the domestic government debt capital market. The asset allocation is strategically bifurcated to balance liquidity and yield capture: a 65% weighting in Treasury Bills (T-Bills) provides substantial liquidity and funds operational short-term requirements, while a 29% allocation to Pakistan Investment Bonds (PIBs) facilitates active positioning across the sovereign yield curve. A 5% cash buffer held in bank deposits provides an additional layer of immediate liquidity. The Fund is exclusively allocated to high-credit-quality instruments: 98% of assets are held in ‘AAA’ rated avenues, which are considered to have minimal default risk. The Fund’s interest rate risk profile is moderate, as evidenced by a Weighted Average Maturity (WAM) of 441 days. This metric indicates active management of duration to navigate the interest rate cycle, balancing the reinvestment liquidity of T-Bills against the higher yield capture of longer-dated PIBs. A key analytical factor is the Fund's unit holding pattern, wherein the top 10 investors represent approximately 73% of net AUM. This high concentration introduces a potential vulnerability to sizable redemption pressures. This structural risk is partially mitigated by the Fund's significant allocation to T-Bills (65%), which benefit from a deep and active secondary market, and is further supported by the explicit 5% liquidity buffer in bank deposits. Consequently, the Fund's liquidity risk, while elevated due to investor concentration, is currently adequately managed by its high-quality, liquid asset portfolio.
Going forward, any material changes in the investment policy or the devised rating criteria for the assigned rating would have an impact on the rating.

About the Entity
Established in 1962, National Investment Trust Limited (NITL) stands as a pioneering institution in Pakistan’s mutual fund industry. Governed by a Board of Directors comprising fifteen distinguished members, the company exemplifies leadership, stability, and strategic governance. On February 14, 2025, Mr. Manzoor Ahmed assumed the role of Acting Managing Director of NITL. With an illustrious career spanning over 33 years in the mutual fund sector, Mr. Ahmed brings unparalleled expertise in investment management, capital market operations, product development, research, and regulatory affairs. In his capacity as Chief Operating Officer (COO), he has demonstrated exceptional leadership in overseeing the company’s operations and investment portfolio, which exceeds PKR 213 billion in value. As one of Pakistan’s foremost asset management companies, NITL boasts a diversified portfolio comprising sixteen open-end funds, including two non-public funds (NIT-SEF and NIT-EMOF), two voluntary pension schemes, two employer pension schemes, and an exchange-traded fund (ETF). As of June 2025, the company’s assets under management (AUM) stood at an impressive ~PKR 195 billion, reinforcing its position as a market leader in wealth and fund management. NITL remains committed to delivering superior returns, maintaining strong governance frameworks, and fostering innovation in Pakistan’s financial sector, ensuring sustained value for its stakeholders.