Pakistan Credit Rating Agency (Pacra) has maintained the stability rating 'AAA (f)' (Triple A - fund rating) of Pakistan Cash Management Fund (PCF) which is currently the highest fund rating on the fund stability rating scale for mutual fund.
PCF is 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. PCF held first position in Money Market Funds category posting an annual return of 11.28 percent and beating industry average of 10.31 percent as of financial year ending 30th June 2010. PCF distributes monthly dividends and has announced a cumulative dividend of Rs 5.3832 during FY2010 translating to a dividend yield of 10.76 percent.
Arif Habib Investments Limited (AHI) is the management company for PCF and is rated "AM2" with a positive outlook by Pacra, this too currently as the highest Asset Management Quality rating in the industry. The objective of PCF is to deliver regular income, capital preservation and high liquidity, primarily from short-duration government securities investments. Fund's robust credit quality and a strong liquidity profile emanates essentially from maintaining minimum exposure of 90 percent in Market Treasury Bills and short maturing reverse repo transactions with government paper as underlying security.
The fund carries exceptionally low exposure to interest rate risk and provides high liquidity to unit holders by maintaining the overall maturity of the portfolio below 90 days (42 days at May10). PCF keeps the remaining balance as bank deposits with minimum AA rated commercial banks for liquidity management purpose. The fund's net assets have grown gradually to Rs 2.6 billion as on May 10, and its unit holding pattern is adequately diversified. Arif Habib Securities - the holding company for Arif Habib Group - holds majority stake (60 percent) in AHI. The group is engaged in financial advisory, brokerage, cement and fertiliser industries.
AHI is one of the leading players in the asset management industry of Pakistan with assets under management of above Rs 17.0 billion as on May 2010. The company currently has eight open-end and three closed-end funds under management and also offers two pension schemes. Nasim Beg, FCA, the founding Chief Executive, has more than 35 years diversified experience. He has been instrumental in development of mutual fund industry in Pakistan.-PR