Press Release
JCR-VIS Upgrades Fund Stability Rating of UBL Government Securities Fund
Karachi, December 29, 2017: JCR-VIS Credit Rating Co. Ltd. (JCR-VIS) has upgraded the Fund Stability Rating of UBL Government Securities Fund (UGSF) to ‘A+(f)’ (Single A Plus(f)) from ‘A(f)’ (Single A (f)). The previous rating action was announced on December 30, 2016.
The rating upgrade reflects significant decline in duration of the fund which is now in line with JCR-VIS’s criteria for the assigned rating. Resultantly, exposure to market risk has decreased. The rating also reflects the fund’s low credit risk profile emanating from its policy to invest in avenues rated ‘AA-’ and above. Moreover, the fund shall invest a minimum 70% of assets (on monthly average basis) in sovereign instruments. Barring June’2017, fund's exposure in government securities was above 70% over FY17.
In FY17, a considerable decline has been witnessed in fund size to Rs. 3.3b (end-FY16: Rs. 14.0b). By end-November 2017, net assets decreased further to Rs. 3.0b. Unit holder concentration has declined on a timeline basis. Given the quality of assets and unit-holder profile, ability to meet redemptions in a timely manner is expected to remain strong.
For further information on this rating announcement, please contact the undersigned (Ext: 207) or Mr. Javed Callea (Ext: 201) at 35311861-70 or fax to 35311872.
Jamal Abbas Zaidi
Advisor
Applicable Rating Criteria: Fund Stability Ratings (December 2017)