Press Release

JCR-VIS assigns initial Fund Stability Rating of Askari Sovereign Yield Enhancer

Karachi, December 31, 2015: JCR-VIS Credit Rating Company Limited (JCR-VIS) has assigned initial Fund Stability Rating of Askari Sovereign Yield Enhancer (ASYE) at ‘A+(f)’ (Single A Plus (f)).

ASYE was incorporated in September 2012 as an open end Income fund. Based on the constitutive document of ASYE, the fund is restricted to place a minimum 70% of net assets in government securities including Pakistan Investment Bonds (PIBs) and Treasury Bills (T-Bills). The fund further ensures adequate liquidity management by placing a minimum 25% of net assets as cash or cash equivalents which includes government securities with a maturity of less than 90 days.

Due to downward movement in the discount rate, average asset allocation of the fund (based on month-end averages) has shifted partially from T-Bills to PIBs. The same impacted the weighted average time to maturity (WATM) of the portfolio which reached 2.61 years at end-FY15 (July’14: 1.73 years) still compliant with its regulatory framework. As such, sensitivity to interest rate movements as signified by duration has also increased by end-FY15.

ASYE is currently placed in the 3rd quartile for FY15 as compared to the 2nd quartile for the previous financial year. Shift in net assets of the fund from Rs. 1.25b at end-FY14 to Rs. 0.91b at end-FY15 has occurred due to corporate redemptions as a consequence of changes in the tax regime. Retail quantum in the fund has improved resulting in growth of net assets to Rs. 1.7b at end-Oct’15.

For further information on this rating announcement, please contact the undersigned (Ext: 516) or Jazib Ahmed, CFA (Ext: 510) at 021-35311861-70 or fax to 021-35311873.

Jamal Abbas Zaidi

Applicable Rating Criteria: Methodology - Fund Stability Ratings (February 2012)

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JCR-VIS Credit Rating Company Limited