Lahore, April 20, 2022 (PPI-OT):NBP Islamic Mahana Amdani Fund (or the “Fund”) is a medium-risk profile fund. The Fund aims to provide monthly income to investors by investing in Shariah Compliant money market and debt avenues. During CY21, the Fund on average invested ~56% of net assets in Banks. The average allocation towards ‘AA-‘ and above rated securities remained ~76% during CY21. At end-Dec’21, the Fund had invested ~49% of its net assets in banks, with 31% being invested in a ‘AAA’ rated bank and 13% in an ‘A+’ rated bank. The Fund had invested 19% of its net assets in government securities. Whereas, ~12% of net assets are invested in Sukuks rated ‘AA’ and above.

The WAM of the Fund is on the higher side due to funds exposure to Government-issued Sukuks, mainly 10-year Pakistan Energy Sukuk and 5-year GOP Ijara Sukuk. It has resulted in WAM swelling to 607 days. However, the related credit risk is low as higher maturity securities are backed by GOP. During CY21, the average WAM remained high at 545 days. The duration of the Fund is 61 days, limiting the fund’s exposure to interest rate risk. The average duration was 43 days throughout CY21 owing to investment in floating rate securities. The Fund has a diversified unit holding pattern, where top 10 investors contribute towards 16% of the total Fund’s Assets.

Therefore, there appears a low amount of redemption pressure. Going forward, the fund intends to maintain its current asset allocation. Material changes in the fund’s asset allocation strategy, impacting its credit quality and/or exposure to interest rate risk will impact the rating.

For more information, contact:
Analyst,
The Pakistan Credit Rating Agency Limited (PACRA)
Awami Complex, FB1, Usman Block New Garden Town,
Lahore, Pakistan
Tel: +92-42-5869504-6
Fax: +92-42-5830425
Email: hammad.rashid@pacra.com
Website: www.pacra.com