FCAM’s legacy short maturity fund returned 12.99% in 2017
FCAM is the wealth and investment management arm of FCMB Group Plc, one of Nigeria’s leading financial institutions.
At the firm’s yearly general meeting held in Lagos on monday, the unitholders also unanimously endorsed the payment of a dividend of 11kobo per unit as well as the name change of the Fund from Legacy Short Maturity (NGN) Fund to Legacy Debt Fund, among other resolutions passed at the meeting.
In the audited results for the year ended June 30, 2017, Legacy Short Maturity (NGN) Fund recorded a Profit After Tax (PAT) of N100.487million, as against N50.343 million realised in the previous Fund Year. In addition, total revenue generated by the Fund rose from N63.422 million, to N119.005 million.
Reviewing the performance of the fund at the AGM, the Chief Executive Officer of First City Asset Management Limited, FCAM), James Ilori, noted that although the return of 12.99 per cent was lower than the 16.82 per cent return of the fund’s benchmark, the Fund carried significantly lower interest rate risk relative to its benchmark.
He added that the fund’s risk rating was upgraded by Agusto & Co. Fund performance is expected to improve significantly in the new Fund year.
The Legacy Short Maturity (NGN) Fund seeks to preserve capital and generate consistent income for unit holders. The Fund pursues its investment objectives by investing in high quality, Naira-denominated Money Market Instruments and short maturity bonds rated by a Securities & Exchange Commission (SEC) registered credit rating agency.
Trading and Settlement is done on a best execution basis. In addition, the Fund is highly liquid and well diversified. Proceeds to investors, at the point of exiting the Fund, are tax-free.
Fund rating was, in December 2017, upgraded by two notches, from BBB+(f) to A(f), by Agusto & Co, the foremost pan-African rating agency. The higher rating of A(f) indicates that Legacy Short Maturity (NGN) Fund has a low to moderate exposure to downside risk (impairment to the net asset value) in the medium term.
According to Agusto & Co, the new rating was on account of the Fund’s good quality assets, adequate liquidity management strategies, and conservative approach to credit risk & enhanced risk management, and zero currency risk exposure.
In addition, the rating agency stated that interest rate risk in the Fund was moderate in the short term, and that the Fund has a high quality portfolio management team with over 18 years’ experience across various financial fields.
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