PACRA Maintains Stability Rating of NBP Islamic Income Fund

NBP Islamic Income Fund ('NIIF' or the 'Fund') is a medium-risk profile fund. The investment objective of the Fund is to provide competitive returns by investing in Shariah compliant debt securities and money market instruments. The assigned rating reflects the Fund's moderate credit and interest rate risk profile emanating from its investment strategy. As of Jun’26, the Fund’s Assets Under Management (AUM) stood at ~PKR 6.02bln, down from PKR 9.36bln as of Dec’25, reflecting a contraction in fund size during the period while maintaining the Fund’s investment strategy. In terms of asset allocation, approximately 67.4% of the portfolio was invested in Cash, ~14.6% in GoP Ijarah Sukuk, ~7.2% in TFCs/Sukuk, ~4.8% in Certificates of Musharika (COM), ~2.9% in Placement with Bai-Muajjal, ~0.5% in placements with Banks and DFIs, and the remaining ~2.6% in other instruments including receivables. The allocation reflects a diversified Shariah-compliant portfolio with a predominant focus on liquidity, complemented by sovereign and corporate fixed-income exposure. From a credit quality perspective, ~44.5% of the assets were invested in AA- rated avenues, ~15.8% in A+ rated instruments, ~14.6% in Government Securities, ~6.8% in AAA rated avenues, ~6.4% in A- rated instruments, with the remaining portion allocated to other categories. The Fund’s asset quality remained in line with the applicable rating criteria, although the portfolio carries relatively higher exposure to mid-tier rated instruments. At end-Jun’26, the Fund’s WAM stood at 219 days, indicating credit risk at the higher end of the moderate spectrum, while duration stood at 74 days, reflecting moderate sensitivity to interest rate movements. The unit holding pattern remained relatively diversified, with the top 10 investors accounting for ~34.7% of total holdings, indicating relatively lower potential redemption pressure. In terms of performance, the Fund delivered a return of 10.3% as of Jun’26, compared to the benchmark return of 9.6% and peer average return of 11.4%, indicating outperformance relative to its benchmark, though remaining below the peer average.
Going forward, any material changes in the investment policy or the devised rating criteria for the assigned rating would have impact on the ratings.

About the Entity
NBP Fund Management Limited (the 'Company'), established in 2005, is licensed by the Securities and Exchange Commission of Pakistan (SECP) to carry out asset management and investment advisory services. The National Bank of Pakistan is the largest shareholder of the company, with a ~54% stake, followed by Baltoro Growth Fund (~36%) and individual investors (~10%). The CEO of NBP Fund Management Limited, Dr. Amjad Waheed, CFA, has over 25 years of experience in mutual funds and portfolio management. The Company’s eight-member Board of Directors includes three independent directors and the CEO. With total assets under management of ~PKR 552.3bln as of Jun '26, the Company manages a diversified portfolio of twenty-six open-end mutual funds, four voluntary pension schemes, and one exchange-traded fund (ETF).