Fitch Ratings has affirmed the National Fund Credit Quality Ratings of
Fitch has also affirmed the funds' National Fund Market Risk Sensitivity Ratings at 'S1(twn)'.
KEY RATING DRIVERS
The affirmation of the National Fund Credit Quality Ratings reflects the sustained high credit quality and short maturity profile of the funds' assets. Fitch bases the rating on the actual and prospective credit quality of the funds. The funds' weighted-average rating factor (WARF) suggested a rating of 'AAAf(twn)' at
The affirmation of the National Fund Market Risk Sensitivity Ratings is driven by the funds' sustained low exposure to interest rate and spread risk, as reflected in the short maturity profile of the funds' assets.
ASSET CREDIT QUALITY
Taishin 1699's portfolio had about 93% of assets rated in the 'A(twn)' to '
The funds have high industry concentration in the Taiwanese banking and finance sectors, which have a stable credit outlook. The top-five issuers account for 29% of both funds' assets under management, lower than the peer average of 35%.
PORTFOLIO SENSITIVITY TO MARKET RISK
The market risk factor was 0.18 for Taishin 1699 and 0.17 for Taishin Ta-Chong at
FUND PROFILE
The funds invest in time deposits, commercial paper, repos and cash. Taishin 1699 is the largest money market fund in the local market, with total assets under management of
INVESTMENT MANAGER
Fitch considers the investment manager to be suitably qualified, competent and capable of managing the funds. Both funds are managed by
TSIT ranks ninth among 39 asset managers in
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive rating action/upgrade:
An upgrade of the National Fund Credit Quality Rating is possible if the credit quality of the underlying assets improves, the weighted-average maturity becomes shorter and the investment strategy supports the improvement in the long term.
Factors that could, individually or collectively, lead to negative rating action/downgrade:
The ratings are sensitive to significant changes in the funds' credit quality or market-risk profiles. A large, adverse deviation from Fitch's guidelines for any key rating driver could lead to a downgrade. Specifically, the increase of 'BBB(twn)' rated securities and an extension of asset maturity could negatively affect the WARF. The ratings are also sensitive to deterioration in the credit quality of
Fitch does not expect a change in the National Fund Market Risk Sensitivity Ratings due to the funds' short asset-maturity profiles, but a downgrade could stem from a structural change in
TSIT provides Fitch with monthly information, including details of the portfolios' holdings, credit quality and transactions, to maintain the funds' ratings. Fitch monitors the portfolios' credit composition, the credit counterparties used by the manager and the overall market risk profile of the investments.
RATING CRITERIA
Fitch rates money market funds in
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