Karachi, December 30, 2016:JCR-VIS Credit Rating Co. Ltd. (JCR-VIS) has reaffirmed the Fund Stability Rating of Al-Ameen Islamic Sovereign Fund (AISF) at ‘AA-(f)’ (Double A Minus (f)). The previous rating action was announced on January 06, 2016.
Launched in November’2010, AISF operates as an open end income fund. As per the offering document, the fund is required to maintain a minimum of 70% exposure in Shariah complaint sovereign instruments while a floor of 10% is also applicable in relationto bank deposits. Fund’s ability to assume credit risk is on the lower side due to cap on minimum rating of instruments at ‘AA-’. On average basis, actual asset allocation of the fund primarily comprised investment in government securities and bank deposits with at-least ‘AA’ rated Banks.
Weighted Average Maturity (WAM) of the fund has remained in line with investment policy guidelines. However, duration of the fund has exceeded JCR-VIS’s internal criteria for the assigned rating on a consistent basis since February’2016. As per management, this is on account of investment in fixed rate GoP Ijarah Sukuk to comply with requirement of minimum 70% exposure in sovereign instruments. Investor concentration in the fund has reduced on a timeline basis. Given that most of the fund is invested in liquid avenues, the fund’s ability to meet redemptions in a timely manner remains sound.
For further information on this rating announcement, please contact the undersigned (Ext: 207) or Mr. Javed Callea (Ext: 201) at 35311861-70 or fax to 35311872.
Jamal Abbas Zaidi
Applicable Rating Criteria: Fund Stability Ratings (February 2012)
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