VIS Credit Rating Company Reaffirms Fund Stability Rating of Meezan Cash Fund

Strategic Insights -

VIS Credit Rating Company Ltd. has reaffirmed the Fund Stability Rating (FSR) of Meezan Cash Fund (MCF) at 'AA (f)' (Double A (f)). The ratings agency reaffirmed the fund's rating after reviewing its investment policy and credit quality, which remained in line with the limits stipulated in the investment policy guidelines for the assigned rating. Meezan Cash Fund is an open-end Shariah compliant money market scheme that aims to provide maximum returns to its investors through deploying assets in specified money market placements and debt securities, while maintaining high liquidity and preserving the principal investment.

Key Takeaways:

  • VIS Credit Rating Company Ltd. has reaffirmed the Fund Stability Rating of Meezan Cash Fund (MCF) at 'AA (f)' (Double A (f)).
  • The fund aims to provide maximum returns to its investors through deploying assets in specified money market placements and debt securities, while maintaining high liquidity and preserving the principal investment.
  • As at end-Oct'21, the net assets of the fund declined to Rs. 12.9 billion.
  • The fund's asset allocation and credit quality remained in line with the limits stipulated in the investment policy guidelines for the assigned rating.
  • The fund managed to park 74% of its investments in AAA-rated issues/issuers, with primary assets comprising cash balances.
  • The Investment Policy Statement (IPS) of the fund caps the Weighted Average Maturity (WAM) at 90 days, allowing the fund to take exposure in AA-rated and above investment avenues.

Statistics:

  • Net assets of the fund as at end-Oct'21: Rs. 12.9 billion.
  • Net assets of the fund in FY21: Rs. 13.6 billion.
  • Net assets of the fund in FY20: Rs. 14.03 billion.
  • Net assets of the fund in FY19: Rs. 8.85 billion.
  • Weighted Average Maturity (WAM) cap: 90 days.
  • Percentage of investments in AAA-rated issues/issuers: 74%.
  • Primary assets: Cash balances.

Sources:

  • VIS Credit Rating Company Ltd. - Press Release, December 27, 2021
  • VIS House, 128/C, 25th Lane off Khayaban-e-Ittehad, Phase VII, DHA, Karachi, Pakistan
  • Tel: +92-21-35311861-72
  • Fax: +92-21-35311873
  • Email: bilal@jcrvis.com.pk
  • Website: https://www.vis.com.pk/