Press Release

JCR-VIS Assigns Initial Capital Protected Fund Rating to UBL Principal Protected Fund III

Karachi, January 18, 2016: JCR-VIS Credit Rating Company Ltd. (JCR-VIS) has assigned initial capital protection rating of ‘CP2+’ to UBL Principal Protection Fund III (UPPF III- Dynamic Hedge Fund [DHF]) which denotes a high certainty of principal protection.

JCR-VIS assigns rating to all funds following Static and Dynamic Hedge categories of capital protection strategies on a common scale, ranging from CP1 to CP5, with CP1 denoting the highest certainty of capital protection. The capital protection rating emphasizes on the degree of certainty of capital protection and does not focus on the return generating potential of the fund. Moreover, the rating denotes the level of expected capital protection at the maturity of the scheme and does not comment on the capital protection in periods prior to maturity.

UPPF III was launched in March’2014, for an investment horizon of 2 years. The fund follows a Constant Proportion Portfolio Insurance (CPPI) based strategy that features varying asset allocation between an equity fund, i.e. UBL Stock Advantage Fund (USF), and a money market fund i.e. UBL Liquidity Plus Fund (ULPF). Underlying equity fund exposure primarily comprises blue chip companies while the underlying money market fund, ULFP, has an outstanding fund stability rating of AA (f) (Double A (f)), signifying low exposure to credit, liquidity and market risk. Exposure to USAF stood at 42% at end-December’2015.

Given the limited time left to maturity, adequate liquidity build-up and return since inception of 11.61% (till December’2015), the principal protection ability of the fund is considered high. Management has also pursued a profit lock strategy, as part of which 6.5% of profits of the fund have been allocated towards fixed income portion thereby enhancing capital protection ability of the fund. Moreover, fund also features an external credit enhancement in form of a guarantee from the management company that covers up to 5% of the subscription amount, which further strengthens principal protection ability of the fund.

For further information on this rating announcement, please contact the undersigned (Ext: 516) or Mr. Javed Callea (Ext: 501) at (021)35311861-70 or fax to (021)35311872-3.

Jamal Abbas Zaidi

Applicable Rating Criteria

Information herein was obtained from sources believed to be accurate and reliable; however, VIS Credit Rating Company Limited 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.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.VIS is not an NRSRO and its credit ratings are not NRSRO credit ratings.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 2016 VIS Credit Rating Company Limited. All rights reserved. Contents may be used by news media with credit to VIS.

JCR-VIS Credit Rating Company Limited