LRA Assigns Initial Stability Rating to Ceybank Gilt Edged Fund (A Series)

Ceybank Gilt Edged Fund (A Series) is characterized by its very low-risk profile Fund. The objective of the Fund is to maximize short-term current income whilst ensuring ease of liquidity. The Fund invests in government securities, with maturities of less than one year. The Fund was initially launched in January 2016. As of December 2023, the asset allocation predominately consists of 99.57% in Treasury Bills, 0.15% with minor allocation in Repos, 0.26% in Bank, and 0.02% in Other. The asset allocation summary for the period spanning March to December 2023 is based on gross assets. The WAM of 104 days and the duration of 90 days at the end of December 2023. With interest rates coming down and a WAM of 104 days, the Fund's returns are expected to dilute going forward. The top 10 investor concentration is 65.49% indicating concentration at the investor level. The Fund strategically limits exposure to interest rates and credit risk. Notably, 99.57% of the Fund's gross assets are invested in securities rated AAA, underlining its commitment to maintaining high credit quality. During the fourth quarter of 2023, the Fund delivered a return of 5.1% for quarter 4 compared with a peer average of 2.8%. Looking ahead the Fund expects to adhere to its approved investment policy and makes investment decisions based on prevailing market conditions. It's imperative to note any significant alteration in the Fund's asset allocation strategy, affecting its credit quality and exposure to interest rate risk, would impact rating accordingly.

About the Entity
The Ceybank Gilt Edged Fund (A Series) (The Fund) is managed by Ceybank Asset Management Limited, which was established in 1991 and is owned by well-known entities. Specifically, 44% of the shares are owned by the Bank of Ceylon, 26% by Sri Lanka Insurance Corporation, 17.5% by the Unit Trust of India, and 12.50% by Carson Cumberbatch PLC. Ceybank Asset Management Limited is licensed under the Securities and Exchange Commission of Sri Lanka Act, No. 19 of 2021, to operate as a Managing Company of Collective Investment Schemes (Unit Trust Funds). The company operates six Funds with a total funds under Management of LKR~ 21,044.67 million (as of Jan 24). Ceybank Asset Management Limited engages in three business activities: Managing Unit Trust Funds, Managing Institutional Client Portfolios, and Providing Advisory Services to high-net-worth individuals and institutional investors both foreign and local. The Board of Directors comprises seven members who are qualified individuals with substantial experience. Mr. Ian Ferdinands serves as the CEO/Executive Director of Ceybank Asset Management Limited, having 35 years of experience in Money & Capital Markets including Fund Management, Primary Dealer Operations, and Foreign Exchange Brokering. Prior to joining Ceybank Asset Management Limited, he worked at National Asset Management Limited, and also worked as a Foreign Exchange broker at Forbes Money Brokers. Mr. Ian Ferdinands is a member of the Chartered Institute of Marketing (CIM UK) and also a Certified e-Marketing Associate (USA). He holds an MBA in Finance from the University of Southern Queensland, Australia. Ms. K Kanchana Probodanie serves as the Senior Fund Manager at Ceybank Asset Management Limited, responsible for the execution of trades in the implementation of investment policies and trading strategies for the Unit Trust Funds and client portfolios. She has over 15 years of experience in Investment Research and Fund Management. Before this, she worked at Union Assurance PLC in the investment division. Ms. Kanchana is a CIMA Member and possesses a Bachelor of Science in Business Administration (Finance special) degree from the University of Sri Jayewardenepura.