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PACRA Maintains Stability Rating of AL Habib Islamic Income Fund

Lahore, September 04, 2023 (PPI-OT): AL Habib Islamic Income Fund (or the “Fund”) reflects the medium risk profile Fund. The objective of AHIIF is to provide competitive risk adjusted returns to its investors by investing in a diversified portfolio of long-, medium and short-term Shariah Compliant debt instruments while taking into account liquidity considerations. The assigned rating reflects the Fund’s moderate credit risk profile emanating from Fund’s Investment policy to invest in avenues with sound liquidity. The allocation of the Fund as of Jun’23 was ~ 63.1% cash in bank. Within this, 48.5% was in AAA rated avenues, and the remaining 14.6% was into AA rated avenues. However, ~11.5% allocation is in the form of TDR within bank rated AA+.

Additionally, ~8.9% was in GoP Ijarah sukuk, around ~14.5% in Corporate Sukuk rated AA and above, and ~1.88% in various other avenues. The duration of the Fund stood at 22 days at the end Jun’23, limiting exposure to interest rate risk. whereas the WAM of the Fund stood at 487 days at the end Jun’23, exposing high credit risk. However, credit risk is high due to the major investment in Govt Securities. The top 10 investors concentration of the Fund stood at~90.1% at the end Jun’23. Going forward, any material changes in the investment policy or devised rating criteria for the assigned rating would have an impact on the ratings.

For more information, contact:

Analyst,

The Pakistan Credit Rating Agency Limited (PACRA)

Awami Complex, FB1, Usman Block New Garden Town,

Lahore, Pakistan

Tel: +92-42-5869504-6

Fax: +92-42-5830425

Email: hammad.rashid@pacra.com

Website: www.pacra.com

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