KARACHI, Jan 1: Necessary legal work relating to the NIT-SEF (State Enterprise Fund) has concluded and the Rs20 billion market support fund was ready to take-off, chairman and MD of NIT Tariq Iqbal Khan told a press briefing on Thursday.

National Investment Trust (NIT), which acts as the manager of the fund, went through the cumbersome exercise of completion of legal work, which entailed signing of the agreement with the financing institutions and the approval of guarantees by the government. The registration/approval of the fund, financing agreements, and guarantees were all completed.

The NIT chairman said that the NIT-SEF was mandated to invest in eight eligible stocks that included OGDC; PSO; PPL; SNGPL; SSGC; Kapco; NBP and the PTCL. The four financing institutions had provided Rs20 billion in the following order: NBP Rs7bn; EOBI Rs5bn; SLIC Rs2.5bn and banking syndicate Rs5.5 billion.

Mr Tariq observed that the funds were provided for a three-year term and “besides principal, it would be serviced at Kibor plus one”.

The manager NIT-SEF gave no specific date for its activation, but said: “very soon”. He was upbeat about the market and pointed to the slowdown in rate of index decline from four per cent on lifting of the floor on Dec 15 to 1.89 per cent on Thursday.

Further, relating to the NIT-SEF, he said that units were intended to be sold to non-resident Pakistanis after the initial operation and after the market stabilises.

“We very strongly feel that the fund due to the eight eligible stocks with strong fundamentals would perform well and provide the necessary security to the financers of the fund,” he said, adding that it would also send strong signals to the market which is overly depressed at this point in time.

He affirmed that NIT-SEF is a separate fund in all respects from the existing funds being managed by NIT.