Press Release

VIS Reaffirms Fund Stability Rating of UBL Government Securities Fund

Karachi, December 29, 2023: VIS Credit Ratings Company Ltd. (VIS) has reaffirmed Fund Stability Rating (FSR) at ‘AA(f)’ (Double A (f)) of UBL Government Securities Fund (UGSF). The medium to long-term rating of ‘AA’ denotes high degree of stability in Net Asset Value; Risk is modest but may vary slightly from time to time because of changing economic conditions. The previous rating action was announced on December 29, 2022.

Launched in July 2011, UBL Government Securities Fund (UGSF) is an open-end income fund, managed by UBL Fund Managers Limited. The investment objective of the fund is to generate a competitive return with minimum risk, by investing primarily in Government Securities.

The Fund’s Assets under Management (AUMs) have plunged to Rs. 914m as of June’23 (June’22: Rs 1,1b). The fund has breached asset allocation limits on multiple occasions, wherein a minimum of 70% of the assets is mandated to be invested in government securities, and a minimum cash maintenance requirement of 30% as specified in the Investment Policy Statement (IPS). However, it remained compliant to its mandate of investment in minimum credit quality rating of ‘AA-‘. With the majority of the investment engrossed in government securities, the fund’s credit quality is deemed strong with 73.3% of assets parked in ‘AAA’ rated securities.

In accordance with the IPS, UGSF maintained its adherence to a maximum Weighted Average Maturity (WAM) of 4 years. Top 10 investor concentration is satisfactory and reported at 42% as of June’23. More than 82% of the unit holders are from retail segment. The fund’s return falls short of the benchmark and peers average return during FY23 while placed in the second quartile relative to its peers.

For further information on this ratings announcement, please contact Mr. Muhammad Amin Hamdani (Ext: 217) or the undersigned (Ext: 208) on 021-35311861-64 or email at info@vis.com.pk.





Syed Asif Ali
Executive Director


Applicable Rating Criteria: Fund Stability
https://docs.vis.com.pk/docs/FundstabilityRating.pdf

VIS Issue/Issuer Rating Scale
https://docs.vis.com.pk/docs/VISRatingScales.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 29, 2023 VIS Credit Rating Company Limited. All rights reserved. Contents may be used by news media with credit to VIS.