Pakistan Credit Rating Agency maintains stability Rating of Pakistan Cash Management Fund

Lahore, January 08, 2013 (PPI-OT): The Pakistan Credit Rating Agency (PACRA) has maintained the stability rating of Pakistan Cash Management Fund (PCF) at ‘AAA (f)’ (Triple A ; fund rating), an open-end money market fund. The fund’s rating denotes an exceptionally strong capacity to maintain relative stability in returns and negligible exposure to risks.

The fund’s mandate is to generate optimal return with exceptionally low risk, by investing primarily in shorter duration money market instruments.

The fund’s strong credit quality and sound liquidity profile emanates primarily from its mandate to allocate 90% of fund’s assets in treasury bills and short maturing reverse repo transactions with government paper as underlying security. At end Sep-12, the fund is primarily invested in T-bills (97%), while the remaining assets are held as cash in scheduled banks with very strong credit quality.

In order to avoid volatility arising from interest rates, the fund carries a duration of 32 days at end Sep-12. The unit holding pattern of the fund is modestly concentrated, with top10 investors representing 51% of the fund’s assets.

The fund’s rating is dependent on maintaining a highly liquid and low-risk portfolio of government securities and bank balances. A minimum exposure of 75% in government securities along with a portfolio duration of less than 45 days is required, while the remaining assets must be placed with scheduled banks having very strong credit quality.

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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