Press Release

JCR-VIS Reaffirms MQ Rating of Primus Investment Management Limited
 

Karachi, November 18, 2014: JCR-VIS Credit Rating Company Ltd. has reaffirmed the Management Quality (MQ) Rating of Primus Investment Management Limited (PIML) at ‘AM3’ (AM-Three) with a ‘Positive’ Outlook. The previous rating action was announced on January 13, 2014.

The assigned rating reflects support of financially strong & committed shareholder, formalized investment process and adequate operational platform. With five funds under management, PIML has made progress in expanding its product offering with the launch of 3 new funds in FY14 and the conversion of Primus Cash Fund (PCF) to PIML Income Fund (PIML-IF).

The two largest funds under management have been able to post strong performance, with returns of both PIML-IF & Primus Daily Reserve Fund (PDRF) featuring in the first quartile, relative to peers. Return of other three funds feature in the lower quartile, though given the limited history, actual performance trends are expected to emerge over time. Risk profile of these funds is being managed in line with their respective mandates. JCR-VIS will continue to monitor the performance of all funds under management to gauge ability to manage multiple asset classes.

Overall control environment of the institution is considered satisfactory. During FY14, research and compliance functions have been set up in-house at PIML. Shared services with Pak Brunei Investment Company Limited include Administration & Human Resource, Information Technology and Internal Audit. The Asset Management Company itself has a strong balance sheet. Management resources are being strengthened.

In line with industry trend, Assets under Management (AUMs) witnessed a decline in June’14; growth in AUMs has been witnessed subsequently, with these increasing to Rs. 9b by end-Oct’14. The two largest funds under management, PIF & PDRF, represent over nine-tenth of total AUMs, as size of the new funds launched during FY14 is currently small. Overall investor base is narrow; in order to develop access to retail investors and achieve growth in AUMs, business functions including marketing & investment services, retail and corporate sales and investment advisory, are in the process of being strengthened. Impact of these changes on the investor profile of funds under management will be tracked by JCR-VIS. Recent changes at the regulatory levels also underscore the need for expanding the retail investor base.

PIML is a wholly owned subsidiary of Pak Brunei Investment Company Limited (joint venture between the Government of Pakistan and Brunei Investment Agency) and has the license to undertake asset management and investment advisory services.

For further information on this rating announcement, please contact Ms. Sobia Maqbool, CFA (Ext: 604) or Mr. Javed Callea (Ext: 501) at 021-35311861-71 or fax to 021-35311872-3.



Jamal Abbas Zaidi
Deputy CEO

Applicable Rating Criteria: Mutual Fund Rating (December 2006)

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Information herein was obtained from sources believed to be accurate and reliable; however, JCR-VIS Credit Rating Company Limited (JCR-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. JCR-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. JCR-VIS is not an NRSRO and its credit ratings are not NRSRO credit ratings. JCR-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 JCR-VIS Credit Rating Company Limited. All rights reserved. Contents may be used by news media with credit to JCR-VIS.

JCR-VIS Credit Rating Company Limited