Fitch Affirms KFCASH at AAAmmf(tha)

Stocks and Financial Services Press Releases Wednesday September 9, 2015 12:41
Bangkok--9 Sep--Fitch Ratings

Fitch Ratings (Thailand) has affirmed Thailand-based Krungsri Cash Management Fund's (KFCASH) National Scale Money Market Fund Rating at 'AAAmmf(tha)'. The money market fund is managed by Krungsri Asset Management Company Limited (KSAM).


The affirmation of KFCASH's rating is driven by the portfolio's overall credit quality and diversification, short maturity profile, minimal exposure to interest rate and spread risks, strong liquidity profile, and the capabilities and resources of KSAM as investment manager.

Portfolio Credit Quality/Diversification

Consistent with Fitch's 'AAAmmf(tha)' criteria, KFCASH maintains high credit quality portfolio by investing exclusively in short-term securities rated at least 'F1(tha)' by Fitch or of a comparable credit quality by other rating agencies. The fund maintains a minimum 70% of its investment in government securities. Counterparty credit quality is high. All of its assets have been rated 'F1+(tha)' in the one year to 24 August 2015. The fund also limits concentration risks from exposure to individual issuers and counterparties, consistent with Fitch's criteria.

In the year to 24 August 2015, more than 98% of the fund's investments were in government short-term securities.
Maturity Profile

KFCASH seeks to limit interest rate and spread risk consistent with Fitch's 'AAAmmf(tha)' criteria. The fund limits its weighted average maturity to reset date (WAM) to 60 days. Although the fund does not set a limit on weighted average life (WAL), all of its investments are in fixed-rate securities, resulting in the same WAL and WAM. The fund's WAM has been mostly below 50 days in the 12 months to 24 August 2015. The fund also limits the final maturity of any investments to a maximum of 193 days.

Liquidity Profile

KFCASH seeks to manage investor redemption risk by maintaining sufficient level of daily and weekly liquidity. The fund has to invest more than 70% of its portfolio in securities maturing overnight and assets recognised as eligible as overnight. The fund has maintained its soft guidelines for holding securities strictly maturing within 10 days at 15%. Liquidity risks are deemed limited given KFCASH's high level of liquid assets, high liquidity baseline, and regular communication with institutional investors.

Fund Objectives

The objective of KFCASH is to offer capital preservation and liquidity, while providing a competitive level of return. The fund pursues its investment objective by investing mainly in government and Bank of Thailand money market instruments. The rest (representing up to 30% of NAV) is invested in the financial institutions sector in the form of saving accounts and repurchase agreements. The fund's internal investment guidelines do not allow investment in corporate instruments. As of 24 August 2015, the fund's total assets under management (AUM) stood at THB20.5bn.

Investment Manager

KSAM is 76.6% owned by Bank of Ayudhya Public Company Limited (AAA(tha)/Stable/F1+(tha)), which in turn is 72.0% owned by Bank of Tokyo-Mitsubishi UFJ, Ltd. (A/Stable/F1). At end-July 2015, KSAM had THB315.1bn in total AUM. About 80.7% of its AUM represents mutual funds, while private and provident funds comprised the rest. With a market share of 6.2% by AUM, KSAM ranked fifth in the mutual fund business with 86 funds under its management. KSAM has adequate compliance, monitoring, investment decision-making processes and fund support consistent with the fund's rating.


The rating may be sensitive to material changes in the credit quality or market risk profiles of the fund. A material adverse deviation from Fitch guidelines for any key rating drivers could lead to the rating being downgraded by Fitch. For additional information about Fitch's money market fund rating guidelines, please see the criteria referenced below.

To maintain the National Money Market Fund rating, Fitch seeks weekly fund and portfolio holdings information from KSAM and conducts surveillance checks against its investment guidelines.

Latest Press Release

Banpu Power Reveals Satisfying 2020’s Half-Year Performance amid Challenging Economy

- In Q4/2020, Shanxi Lu Guang power plant in China and solar farms in Japan expected to achieve COD; second wind farm in Vietnam to close deal for revenue recognition - Total capacity of 2,810 MWe; ready to reach goal of 5,300 MWe in 2025 with investment...

MUFG Pledges Support to Southeast Asian Students in Japan

MUFG Bank, Ltd. and Bank of Ayudhya (Krungsri) are amongst a group of MUFG companies and strategic bank partners in Asia that have jointly pledged JPY400 million (approximately THB116 million) to help Southeast Asian students in Japan tide through...

CKP Predicts a Record High Revenue in Second Half of the Year After the Full Capacity Operation From a Sharp Increase of Water Inflow at Nam Ngum 2

Mr. Thanawat Trivisvavet, the Managing Director of CK Power Public Company Limited (CKPower), or "CKP” in SET, announced the performance of CKPower and its subsidiaries for the second quarter of 2020 and 2020 mid-year. The overall performance of...

Fitch Revises Outlook on Bank of Ayudhya to Negative; Affirms Ratings

Fitch Ratings has revised the Outlook on Bank of Ayudhya Public Company Limited's (BAY) Long-Term Issuer Default Rating (IDR) and National Long-Term Rating to Negative from Stable. At the same time, Fitch has affirmed BAY's Long-Term IDR of 'BBB+' and...

Fitch Revises Outlook on SMTB Thai to Negative; Affirms Ratings

Fitch Ratings has revised the rating Outlook on Sumitomo Mitsui Trust Bank (Thai) Public Company Limited (SMTBT) to Negative from Stable. At the same time, Fitch has affirmed the bank's National Long-Term Rating of 'AAA(tha)', and its National Short-Term...

Related Topics