Press Release

VIS Reaffirms Fund Stability Rating of ABL Income Fund

Karachi, December 30, 2022: VIS Credit Rating Company Limited (VIS) has reaffirmed the Fund Stability Rating (FSR) of ABL Income Fund (ABL IF) at ‘A+(f)’ (Single A Plus (f)) The medium to long-term rating of ‘A+’ denotes moderate degree of stability in NAV. Risk factors may vary with possible changes in the economy. The previous rating action was announced on January 18, 2022.
ABL-IF is an open-end income fund launched in September 2008. The fund’s objective is to earn a superior risk adjusted rate of return by investing in a blend of short-, medium- and long-term instruments, both within and outside Pakistan.
Maximum and minimum limits have been stated in the Investment Policy Statement (IPS). In order to restrict the fund’s exposure in various investments and credit quality, quarter of the fund’s asset must be allocated in cash and cash equivalents, other investment avenues comprise of government securities, TFCs and Commercial Paper.
Assigned rating takes note of actual asset allocation during FY22 which on average basis remained concentrated in its cash balances and T-bills. Credit quality thresholds in the Investment Policy Statement (IPS) were updated in Nov 2021, reflecting easing of credit quality. Barring few instances, asset class distribution remained in line with the Offering Document. During FY22, almost 1/3rd of the fund’s assets remained parked in ‘AA-‘rated instruments. Weighted Average time to Maturity (WAM) and duration of the fund remained compliant with the limits. Relative fund performance depicts improvement despite the fund’s consistent underperformance against its benchmark return. On annual return basis for FY22, the fund ranked 8 out 30 among peers (FY21: 27 out of 31), outperforming its peer average return. Improvement in the fund’s asset allocation and maintenance of credit quality metrics in line with the assigned rating, along with improved fund performance will remain important for rating, going forward.
For further information on this rating announcement, please contact Ms. Syeda Batool Zehra Zaidi (Ext: 210) or the undersigned (207) at 021-35311861-70 or email at info@vis.com.pk.


Sara Ahmed
Director

Applicable Rating Criteria: Fund Stability Ratings (December 2020)
https://docs.vis.com.pk/docs/FundstabilityRating.pdf

Information herein was obtained from sources believed to be accurate and reliable; however, VIS Credit Rating Company Limited (VIS) does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. VIS, the analysts involved in the rating process and members of its rating committee do not have any conflict of interest relating to the rating(s)/ranking(s) mentioned in this report. VIS is paid a fee for most rating assignments. This rating/ranking is an opinion and is not a recommendation to buy or sell any securities. Copyright December 30, 2022 VIS Credit Rating Company Limited. All rights reserved. Contents may be used by news media with credit to VIS.