Press Release

VIS Reaffirms Fund Stability Rating of Meezan Sovereign Fund

Karachi, January 03, 2023: VIS Credit Rating Company Limited (VIS) has reaffirmed the Fund Stability Rating (FSR) of Meezan Sovereign Fund (MSF) at ‘AA(f)’ (Double A (f)). The medium to long-term rating of ‘AA(f)’ denotes high degree of stability in NAV. Risk is modest but may vary slightly from time to time because of changing economic conditions. The previous rating action was announced on December 27, 2021.
Meezan Sovereign Fund (MSF) is an open-ended Shariah compliant sovereign fund designed to offer competitive returns to investors through deploying resources primarily in government backed Shariah compliant debt securities. As at Oct’22, MSF’s Assets under Management (AUMs) have decreased to Rs. 5.6b (Jun’22: 6.2b; Jun’21: Rs. 9.9b). Fund’s duration is capped at 180 days, while exposures are limited to a minimum of ‘AA-’ and above rated investment avenues.

The fund remained compliant with asset allocation and credit quality as stipulated by Offering Document (OD). However, it breaches the VIS rating benchmark of maintaining investments in AA- or above bands for the assigned level of ratings. Though this is off-set by maintaining on average 91.8% of investment in AAA rated category during FY22. Average duration of the fund for FY22 was reported above the limit of 90 days as per the assigned ratings. Liquidity also remained strong with investments majorly in liquid Government Securities, which also provides comfort against higher market risk exposure. Relative to its peers, fund returns were lower than peer average as of Jun’22, as a result of which relative ranking dropped. The assigned rating remains dependent on compliance with benchmarks and improvement in return rankings of the fund.

For further information on this rating announcement, please contact Mr. Arsal Ayub (Ext: 215) or the undersigned (Ext: 207) at (021) 35311861-66 or email at info@vis.com.pk.





Sara Ahmed
Director


Applicable Rating Criteria: Fund Stability Ratings (Dec 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 2023 VIS Credit Rating Company Limited . All rights reserved. Contents may be used by news media with credit to VIS .