Press Release

VIS Reaffirms Fund Stability Rating of Faysal Cash Fund

Karachi, Dec 27, 2024: VIS Credit Rating Company Limited (VIS) has reaffirmed Fund Stability Rating (FSR) of Faysal Cash Fund (‘FCF’ or ‘the Fund’) at ‘AA+(f)’ (Double A Plus (f)). The medium to long-term rating of ‘AA+’ denotes high degree of stability in NAV; Risk is modest but may vary from time to time because of changing economic conditions. The previous rating action was announced on December 15, 2023

Launched in January 2021, FCF is an open-ended money market fund, managed by Faysal Asset Management Limited. The objective of the scheme is to seek maximum possible preservation of capital and a competitive rate of return via investing primarily in money market securities.

Assigned rating take into account the Fund’s asset allocation strategy, which has generally adhered to the parameters outlined in the offering document for most of the year, although some exceptions in allocation of cash and Government Securities were noted, which were rectified subsequently. The Fund’s portfolio is mainly composed of T-Bills and cash, with T-Bills making up more than half of its total investments. Assets Under Management (AUM) witnessed a sizeable contraction, falling below the minimum fund size regulatory threshold. Additionally, the assigned rating reflects the Fund’s well credit quality, as it primarily maintains exposures in government securities/AAA rated assets, followed by investments in AA+ and AA rated securities. While the fund’s offering document limits exposures at AA, the fund allocated 2% of the total AUMs to AA- rated instruments in the month of Dec '23, breaching the threshold.

The Fund complied with the weighted average time to maturity (WAM) and duration requirements, consistently remaining below the defined benchmark in the offering document. The Fund’s clientele primarily consists of retail investors, accounting for ¬~99% of the portfolio. Furthermore, the client concentration is notably high, as top ten investors represent ~98% of the total investments. In terms of performance, the Fund has outperformed both its benchmark and the peer average, advancing from the fourth quartile in FY23 to the first quartile in FY24.

For further information on this ratings announcement, please contact at 021-35311861-64 or email at info@vis.com.pk.


Applicable Rating Criteria: Fund Stability Ratings
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 2024 VIS Credit Rating Company Limited . All rights reserved. Contents may be used by news media with credit to VIS .