Pakistan Credit Rating Agency Maintains Stability Rating Of Askari Islamic Income Fund

Lahore, June 28, 2012 (PPI-OT): The Pakistan Credit Rating Agency (PACRA) has maintained stability rating of Askari Islamic Income Fund (AIIF), an open-end Shariah compliant income fund at, “AA- (f)” (Double A Minus ; fund rating). The fund’s rating denotes a very strong capacity to manage relative stability in returns and very low exposure to risks.

The investment objective of the fund is to earn a reasonable rate of return in Shariah compliant manner by investing in Islamic income investments having good quality and liquidity. The rating reflects strong credit quality of the fund’s assets and a robust liquidity profile emanating from sizable investment in GoP Ijara Sukuk (46%) and cash balances (33%) with good quality Islamic banks having ‘A’ and above rating at end Mar-12.

The remaining portfolio comprises ‘AA’ and above rated Shariah compliant money market instruments. At the same time, the rating incorporates fund’s very low exposure to interest rate volatility emanating from a portfolio duration of 57 days at end-Mar12. However, the fund has high concentration in unit holding pattern, with top10 representing 66% of the fund size. However, comfort can be drawn from significant holding of the sponsor.

The rating is dependent upon maintaining around 65% exposure in GoP Ijara Sukuk. The remaining assets will be kept as daily balances with Islamic banks and a minimal portion (not more than 10%) will comprise money-market placements. The fund aims to limit the impact of interest rate risk by maintaining a duration of less than 90 days.

For more information, contact:
Hammad Rashid
Analyst
The Pakistan Credit Rating Agency Limited (PACRA)
Awami Complex, FB1, Usman Block New Garden Town,
Lahore – Pakistan
Tel: +9242 586 9504 -6
Fax: +9242 583 0425
Email: hammad.rashid@pacra.com
Web: www.pacra.com

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