Press Release

VIS Reaffirms Fund Stability Rating of Al -Ameen Islamic Cash Fund

Karachi, December 29, 2022: VIS Credit Rating Company Limited (VIS) has reaffirmed the Fund Stability Rating (FSR) of Al-Ameen Islamic Cash Fund (AICF) at ‘AA+ (f)’ (Double A Plus (f)). The medium to long-term rating denotes high degree of stability in NAV. Risk is modest but may vary slightly from time to time because of changing economic conditions. Previous rating action was announced on January 13, 2022.

AICF is a Shariah Compliant fund aimed at providing high liquidity and competitive returns while seeking maximum possible preservation of capital by investing in low risk and liquid Shariah Compliant instruments. Net assets of the funds increased to Rs. 7.8b at end-Jun’22 from Rs. 5.8b at end of FY21 with further escalation reported at end-Oct’22 to Rs. 11.2b. As per Investment Policy Statement (IPS), Weighted Average Maturity (WAM) is capped at 90 days while exposures can only be taken in ‘AA’ and above rated investment avenues.

During FY22, Funds’ asset allocation remained in line with limits stipulated in investment policy guidelines with 75% (average FY22) of the asset base engrossed in cash deposits. The fund also complied with the credit quality requirements of the Offering Document. However, in six months during FY22, the fund parked more than 25% of its assets in AA rated exposure non-complying the requisites stated in VIS fund rating methodology. Complying to the VIS methodology going forward will be important to sustain the ratings. WAM also remained compliant within the specified limit as per IPS and the assigned ratings. Over the past two years, the fund has consistently outperformed its benchmark return. Relative ranking of the fund however remained in the third quartile consecutively over the last two years. With high retail concentration (71%), modest top-10 investor concentration (33%) at end-FY22, and high composition of liquid assets in the portfolio, liquidity risk is considered on the lower side.

For further information on this rating announcement, please contact Ms. Asfia Aziz (Ext: 212) or the undersigned (Ext: 201) at 35311861-70 or email at info@vis.com.pk






Javed Callea
Advisor

Applicable rating criteria: Fund Stability Ratings (December 2020)
https://docs.vis.com.pk/docs/FundstabilityRating.pdf

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