JCR-VIS Credit Rating Company Ltd has upgraded the Management Quality Rating of HBL Asset Management Limited (HBL AMC) from 'AM3+' (AM - Three Plus) to 'AM2-' (AM - Two Minus). The outlook on the assigned rating is 'Stable'. The rating upgrade takes into account reinforcement of various facets of the organisation. The Management team at HBL AMC has been strengthened with the appointment of competent new resources.
The core team has exhibited stability over time and, in an effort to increase the share of retail segment and reduce investor concentration, a retail sales team has been developed, strengthening the marketing infrastructure. This has resulted in an increase in the retail investor base over the past year, and further efforts to bring about growth in this area are on-going.
HBL AMC's ability to support and manage investment management has improved over time, and a structured investment process has been introduced. The Research Department generates various reports covering fundamental and technical analysis, as well as monthly macroeconomic reports; the Investment Committee (IC) finalises investment decisions after extensive discussions; and compliance ensures that decisions by the IC are executed by the Portfolio Management Team within the stipulated timeframe.
Lastly, a Board level Risk Management Committee (RMC) has been recently established and is considered positive risk, and compliance now directly reports to the RMC. The risk profile of both, conventional and Islamic money market funds, remains aligned with their respective investment policies. The return of HBL Money Market Fund is in the top quartile, whereas return of Islamic Money Market Fund was placed as second out of three funds in FY13. The return of HBL Income Fund was adversely affected by the provisioning requirement; however, the future downside risk has been reduced.
Performance of the Islamic stock fund remained weak in relation to others, whereas the return of the conventional stock fund was also lower than peer group average. On the other hand, performance of the Multi-Asset Fund was stronger and the management is re-visiting its strategy on the equities side.-PR
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