Karachi, January 19, 2022 (PPI-OT):VIS Credit Rating Company Limited (VIS) has reaffirmed the Fund Stability Rating (FSR) of ABL Government Securities Fund (ABL GSF) to ‘AA- (f)’ (Double A Minus (f)). Previous rating action was announced on December 31, 2020.

Launched in November 2011, ABL GSF is designed to deliver risk adjusted returns by investing primarily in a diversified pool of debt instruments comprising of short- and long-term government securities. The fund’s Investment Policy Statement (IPS) restricts minimum 70% of the fund’s assets to be placed in government securities based on quarterly average investment calculated on daily basis.

Net assets of the fund decreased to Rs. 2.9b (FY19: Rs. 4.7b) by end-FY21. The fund’s asset base primarily comprised of government securities and cash balances while rest of the investment portfolio comprised commercial papers and TFCs. Asset allocation was mainly concentrated in ‘AAA’ and ‘AA-’ rated issues/issuers during the year. Total number of investors of the fund decreased slightly during FY21, with decline mainly emanated from retail investors and unrelated associates.

During the period under review, the funds relative ranking declined as the fund underperformed both the benchmark and peer average returns. Weighted Average Maturity (WAM) of the fund is capped at 4 years while modified duration is capped at 1-2 years. While duration remained within IPS requisites, it remained above the VIS’s benchmarks for the assigned rating. Maintaining asset allocation and duration of the fund in line with VIS benchmarks will remain important for rating, going forward.

For more information, contact:
Director Compliance and Rating Analytics,
VIS Credit Rating Company Limited
VIS House, 128/C, 25th Lane off Khayaban-e-Ittehad,
Phase VII, DHA, Karachi, Pakistan
Tel: +92-21-35311861-72
Fax: +92-21-35311873
Email: bilal@jcrvis.com.pk
Website: https://www.vis.com.pk/