JCR-VIS Upgrades Fund Stability Rating of Faysal Income and Growth Fund

Karachi, November 21, 2012 (PPI-OT): JCR-VIS Credit Rating Company Ltd. (JCR-VIS) has upgraded the fund stability rating of Faysal Income and Growth Fund (FIGF) to ‘A+(f)’ (Single A Plus (f)) from ‘A (f)’ (Single A (f)).

Even though FIGF is categorized as an aggressive income fund, the asset allocation strategy of the fund is conservative both in terms of actual exposures and limits laid down in the operational investment policy.

Operational investment policy limits the fund’s exposure to credit risk, with investment in ‘AA-’ or higher rated exposures to comprise at least 90% of net assets and holding in ‘A+’ rated exposures restricted to 10% of net assets. At end-Oct’12, around 92% of net assets represented investment in ‘AA-’ or higher rated exposures. Remaining net assets were largely maintained as cash balances with commercial banks. Given that maximum duration is capped at 180 days in the operational policy, fund’s susceptibility to interest rate risk is considered on the lower side.

Even with significant investor concentration, the ability of the fund to meet redemptions in a timely manner is considered sound as majority of net assets are invested in liquid avenues. However, diversification in investor base will allow the fund manager to implement the envisaged investment strategy for the fund over the long term.

Net assets of the fund have remained stable and amounted to Rs. 547m at end-Oct’12. Fund’s performance has improved on a timeline basis and compares favorably to peers and the benchmark.

For more information, contact:
Mr. Javed Callea
Advisor
JCR-VIS Credit Rating Company Limited
Tel: +9221 35311861 (10 lines) (Ext: 501)
Fax: +9221 35311872-3
E mail: javed.callea@jcrvis.com.pk

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