PACRA Maintains Stability Rating of MCB DCF Income Fund

MCB DCF Income Fund (“MCB-DCFIF” or “the Fund”) is classified under a medium-risk profile, with the objective of generating competitive fixed income returns through an optimal mix of authorized debt instruments while ensuring capital preservation and maintaining adequate liquidity. As of Dec’25, the Fund’s Assets Under Management (AUM) stood at PKR 18,760mln, compared to PKR 20,766mln as of Jun’25 (the last review), indicating a contraction in fund size during the review period. In terms of asset allocation, ~43% of the portfolio was invested in cash placements, ~27% in Pakistan Investment Bonds (PIBs), ~8% in GoP Ijarah Sukuks, and ~6% in Treasury Bills, with the remaining invested in other permissible instruments. This allocation reflects a balanced portfolio structure, combining liquidity management with exposure to sovereign instruments to support income generation. From a credit quality perspective, approximately ~86% of the Fund’s assets were concentrated in Government Securities and AAA rated instruments, indicating strong underlying credit strength and limited exposure to credit risk. As of Dec’25, the Fund’s Weighted Average Maturity (WAM) stood at 438 days, reflecting moderate duration exposure and measured sensitivity to changes in interest rates and credit spreads. This maturity profile remains consistent with the Fund’s strategy of capturing yield opportunities in medium-tenor sovereign instruments while maintaining portfolio stability. On the investor side, the unit holding pattern indicates relatively low concentration risk, with the top 10 investors accounting for ~19% of the Fund’s total holdings as of Dec’25. The diversified investor base provides comfort regarding potential redemption pressure and supports overall liquidity management. In terms of performance, the Fund reported a year-to-date annualized return of 9.79% as of Dec’25, compared to the benchmark return of 10.54%. The performance reflects the Fund’s portfolio positioning and duration management during the review period.
Going forward, any material changes in the investment policy and/or compliance with the rating criteria for the assigned rating would have an impact on 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 Dec 2025, 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 strong governance, objective decision-making, and alignment with regulatory best practices. The Company’s assets under management (AUM) have grown significantly, reaching approximately PKR 429 Billion as of December 2025, reflecting its strong market presence and consistent growth in Pakistan’s asset management industry.