Press Release
JCR-VIS Revises Fund Stability Rating of ABL Government Securities Fund to ‘A(f)’
Karachi, December 31, 2015: JCR-VIS Credit Rating Company Limited (JCR-VIS) has revised the Fund Stability Rating of ABL Government Securities Fund (ABL GSF) to ‘A(f)’ (Single A(f)) from ‘A+(f)’ (Single A plus(f)). Last rating action was taken on 13 August 2014.
ABL Government Securities Fund (ABL-GSF) was launched in November 2011, as an open end mutual fund. As per its mandate, the fund primarily invests in government paper. Average asset allocation to government securities equaled 82% during FY15. While this figure exhibited considerable variation across the year, it remained in compliance with the operational investment policy. Authorized investments are subject to a minimum quality of ‘AA-’, which denotes high credit quality.
After extending target duration from one to two years during the previous year, it exceeded the said limit on multiple occasions. This increased the market risk of the fund, whereby adverse movement in interest rates could potentially affect the value of the portfolio. Given that the weighted average maturity and duration have surpassed JCR-VIS’s internal criteria, the risk profile of the fund is no longer commensurate with the previous outstanding rating.
For further information on this rating announcement, please contact the undersigned (Ext: 516) or Jazib Ahmed, CFA (Ext: 510) at 021-35311861-70 or fax to 021-35311873.
Jamal Abbas Zaidi
Advisor
Applicable Rating Criteria: Methodology - Fund Stability Ratings (February 2012)
http://jcrvis.com.pk/Images/FSRMeth-201202.pdf