JCR-VIS Reaffirms Management Quality Rating of JS Investments Limited

Karachi, December 31, 2015 (PPI-OT): JCR-VIS Credit Rating Company Ltd. (JCR-VIS) has reaffirmed the Management Quality Rating of JS Investments Limited (JSIL) at ‘AM2-’ (AM-Two Minus) with a ‘Stable’ Outlook. The previous rating action was announced on August 20th, 2014.

The ratings of JSIL take into account the support provided to the asset management company (AMC) by sponsor, improved organizational structure and enhanced efforts, especially in further penetrating the retail market. The AMC derives support from sponsor bank via ‘Space Utilization and Facilitation Agreement’ allowing for sales operations through bank branches. During 2HY-2015, JSIL completed the successful merger of two funds into an equity based scheme. JSIL currently manages a product suite of nine (09) collective investment schemes (CISs) and two (02) pension schemes covering both conventional and Shari’ah segments.

During the opening (conversion) of equity closed end funds, net assets of the AMC faced significant pressure due to redemptions, largely from institutional clients. As such, assets under management (AUMs) fell from Rs. 14b at June’14 to Rs. 9b at June’15. The board and senior management have already addressed this scenario by hiring a new Country Head of Business Development and focusing on building a strong sales team, especially in the retail segment. Retail penetration will need to be paid importance due to investor concentration present in several funds.

Overall fund performance has continued to maintain its position in the upper quartile in comparison to peers. However, returns of two equity funds faced pressure due to unexpected redemptions. To enhance operational efficiency of the fund management department, the company hired a new Chief Investment Officer, Head of Research and additional fund managers during 2015. Impact of this supplement on the fund management team will be seen during the coming year.

The company draws strength from the enhanced efforts made towards customer relationship management. The same is derived from the robust I.T structure in-place at JSIL. Value-added services are given importance with the company looking for innovative ways to improve the clients’ experience and further ease investment / redemption / conversion transactions.

For more information, contact:
Ms. Sobia Maqbool
CFA
JCR-VIS Credit Rating Company Limited
VIS House, 128/C,
25th Lane off Khayaban-e-Ittehad,
Phase VII, DHA, Karachi
Tel: +92-21-35311861-72
Fax: +92-21-35311873
Email: sobia@jcrvis.com.pk