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Criteria | Rating Modifiers | Jun-22
Methodology | Stability Rating | Jun-21
Sector Study | Mutual Funds | Stability | Mar-22
LRA Assigns Initial Stability Rating to NAMAL High Yield Fund
|Rating Type||Stability Rating|
NAMAL High Yield Fund’s (or the ‘Fund’) rating reflects strong credit and interest rate risk profile emanating from its investment strategy. At end Dec'21, the Fund had placed ~73% of its net assets with NBFIs, ~19% in commercial papers and ~8% with banks. In terms of credit risk, ~72% of the Funds net assets are placed in securities rated A- or higher. The fund has some investments in BBB+ and BBB categories exposing it to credit risk. The weighted average maturity of the Fund was 90 days at end Dec’21, which is in compliance with the investment policy. The duration of the fund was 90 days as at end-Dec'21. During CY21, the Fund’s return as 5.93% compared with a peer average of 5.72%.
Going forward, the Fund will continue to invest in accordance with its approved investment policy and based on market expectations. Material changes in the Fund's asset allocation strategy, impacting it's credit quality and/or exposure to interest rate risk, would affect the rating.
National Asset Management Limited (NAMAL or ‘the Company’), licensed by the Securities and Exchange Commission of Sri Lanka is the pioneer investment Unit Trust management company in Sri Lanka established in 1991 with 30 years of experience. NAMAL is a subsidiary of Union Bank of Colombo PLC, and includes FCC Bank PLC and Ennid Capital (Pvt) Limited as shareholders. NAMAL operates five Unit Trusts with overall assets under management of LKR 3,647mn as at end-Dec-21 and also offers private portfolio management services.
NAMAL’s Board of Directors comprises of seven members who are highly qualified individuals with decades of experience in financial markets. The Chairman, Mr Alexis Lovell MBE, has over four decades of experience in the field of finance and investment banking. NAMAL also has in place an investment committee and a risk management committee to oversee its processes.