Press Release

VIS Assigns Initial Fund Stability Rating to Faysal Islamic Sovereign Plan-II (Under Faysal Islamic Sovereign Fund)

Karachi, August 20, 2024: VIS Credit Rating Company Limited (VIS) has assigned the initial Fund Stability Rating (FSR) of AA (f) (Double A (f)) to Faysal Islamic Sovereign Plan-II (FISP- II). The FSR of ‘AA(f)’ denotes high degree of stability in Net Asset Value. Risk is modest but may vary slightly from time to time because of changing economic conditions.

FISP-II was launched in Jan’24, with the objective to generate a competitive return with low risk, by investing primarily in Shariah Compliant Government Securities and Islamic Banks and Islamic Banking Windows of Conventional Banks.

Assigned rating takes into account the FISP-II’s Assets under Management, which peaked in February 2024 and declined thereafter through June 2024. The FISP-II portfolio is predominantly comprised of sizeable investments in Ijarah Sukuk followed by investments placed in cash as well as placements with banks, DFIs, and other receivables. The FISP-II has remained consistent with its mandate, investing in instruments only rated AA- and above.

Assigned rating also incorporate the market and liquidity risk profile of FISP-II, wherein the weighted average time to maturity remained within the specified duration as stipulated in the Investment Policy statement. Additionally, the modified duration stands well under the specified limit for the assigned rating. Rating also takes into account FISF-II’s low concentration risk as its investors base is dominated by the retail clients. Furthermore, the top 10 investors accounted for 38.1% of the total plan. Given the liquid nature of investments, redemption risk is considered manageable. In addition, the rating also factors in the plan’s underperformance against its benchmark rate during the first six months of operations.

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

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