Islamabad: The Pakistan Credit Rating Agency Limited (PACRA) has maintained the stability rating of the Mahaana Islamic Cash Fund at ‘AA+(f)’ with a stable outlook, highlighting its strong credit quality and prudent investment strategy focused on Shariah-compliant low-risk instruments.

According to The Pakistan Credit Rating Agency Limited, the Mahaana Islamic Cash Fund aims to deliver competitive returns while ensuring capital preservation by investing in Shariah-compliant, low-risk, and liquid authorized instruments. The Fund, which operates under strict Shariah guidelines, primarily invests in cash and cash equivalents like short-term government bonds and money market instruments.

As of the end of June 2024, the Fund’s assets totaled PKR 385 million. Its investment allocation included approximately 62.2% in bank placements, 19.5% in Ijara Sukuks, 18.2% in short-term Sukuks, and a marginal 0.1% in other instruments. The credit quality of the Fund’s investments was predominantly high, with about 67.2% rated ‘AA’ and 32.8% rated ‘AAA’ or as government securities.

The Fund’s weighted average maturity (WAM) and duration both stood at 30 days at the end of June 2024, indicating a low exposure to interest rate and credit risks. Despite a high concentration of investments from the top 10 investors, accounting for approximately 81% of the Fund’s total investments, the associated redemption risk is mitigated by significant contributions from related parties.

The future stability of the Fund’s ratings is contingent upon any material changes in its investment policy or the criteria used for rating assessments.