Pakistan Credit Rating Agency Maintains Stability Rating of Metro Bank

Lahore, June 14, 2012 (PPI-OT): The Pakistan Credit Rating Agency (PACRA) has maintained stability rating of MetroBank-Pakistan Sovereign Fund (MSF), an open-end income fund at ‘AA (f)’ (Double A ; fund rating). The fund’s rating denotes a very strong capacity to manage relative stability in returns and very low exposure to risks.
MSF aims to provide income and capital preservation to its unit holders by investing primarily in bonds and debt securities issued by Government of Pakistan.

The rating recognizes that the fund has a very strong credit quality and a sound liquidity profile. Lately, the asset mix of the fund is experiencing a change in favour of short-term T-Bills as against traditionally high proportion of long-term fixed rate PIBs.

This may further lower the volatility in fund’s NAV compared to the past. Currently, the fund primarily contains sovereign securities (T-Bills: 89%, GoP Bonds: 6%) at end Mar-12. The remaining assets are with banks as cash balance. The unit holding pattern of MSF is highly concentrated; however, comfort can be drawn from primary investor’s majority holding in the fund.

The rating is dependent on maintaining at least 70% exposure to government securities with a portfolio duration not exceeding 180 days. The remaining portfolio will be placed with ‘AA+’ and above rated banks as cash balance.

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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