Press Release

JCR-VIS Reaffirms Fund Stability Rating of United Growth and Income Fund

Karachi, August 4, 2014: JCR-VIS Credit Rating Co. Ltd. (JCR-VIS) has reaffirmed the Fund Stability Rating (FSR) of United Growth and Income Fund (UGIF) at ‘BBB+(f)’ (Triple B Plus (f)).

Structured as an aggressive income fund, UGIF has the flexibility to assume high level of credit risk in order to capitalize on potential upsides and is suited for investors with a long term investment horizon. As per the fund’s operational investment policy, at least 10% of the net assets have to be maintained in form of cash and 10% in form of T-Bills while exposure to Corporate Bonds/ Commercial Paper may comprise up to 50% of the net assets. On an average, more than one-third of assets comprised sovereign instruments and TFCs/Sukuk each, over the last year. Credit quality of the TFCs/Sukuk portfolio has showcased improvement as non-performing proportion declined on account of recoveries and settlements. The remaining non-performing exposures have mostly been provided. In addition fresh exposures have mostly been built against sound counterparties.

As an aggressive income fund, UGIF can invest in instruments with maturities of up to 10 years; investment guidelines dictate maximum Weighted Average Maturity (WAM) of 5 years (excluding sovereign instruments) and maximum duration of 2.5 years. Actual WAM of the fund has remained compliant with the guideline.

Investor activity in the fund continues to remain dull as issuance of fresh units of UGIF continues to be suspended. Top-10 investors continue to hold a substantial proportion of the fund; given that major part of this pertains to United Bank Limited (UBL), liquidity constraints, on account of redemptions are unlikely to arise.

For further information on this rating announcement, please contact Mr. Javed Callea (Ext: 501) or Ms. Sobia Maqbool, CFA (Ext: 604) at 35311861-70 or fax to 35311872.



Jamal Abbas Zaidi
Deputy CEO

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 2014 VIS Credit Rating Company Limited . All rights reserved. Contents may be used by news media with credit to VIS .