Kingdom's largest asset manager launching range of Irish-domiciled Islamic funds
NCB Capital, Saudi Arabia's largest asset manager, is launching a range of Irish-domiciled Islamic mutual funds, as it seeks to broaden its investor base and appeal to emerging market investors, according to senior executives.
The Jeddah-based firm, which manages US$12.1bn in assets, has launched two funds which invest in Saudi Arabian and GCC equities, with plans to launch other funds including one that will invest in sukuk, or Islamic bonds.
"We are very keen on offering a gateway to the region. The hope is to have a broad investor base," Faysal Badran, chief investment officer and head of asset management at NCB Capital, told Reuters late on Monday.
Future plans call for developing a range of up to ten funds within 18 months, including a fund that will invest in sukuk, Badran said. "We have plans for other equity and sukuk concepts".
The sukuk fund could materialize in 12 to 18 months, helped in part by favourable sukuk issuance conditions, Badran added.
NCB Capital, part of unlisted National Commercial Bank - the kingdom's biggest bank by assets - is targeting each fund to have between US$50m to US$100m in assets.
The brokerage seeks to attract investors that want to diversify their portfolios outside of other emerging markets, according to Jawdat Al Halabi, chief executive of NCB Capital.
The funds, which have institutional and retail share classes, will be distributed to investors in Turkey, Malaysia, Indonesia as well as European and Gulf regions, Badran said.
These are registered as UCITS (Undertakings for Collective Investment in Transferable Securities), a European regulatory framework that allows funds to be sold in any European Union country after approval from a single member state.
UCITS can also be sold outside of Europe, with NCB Capital planning to market the funds internationally through its own sales team and in conjunction with Amundi, a global asset manager with US$919bn in assets under management.
In March, NCB Capital signed a strategic alliance with Amundi and the Trust Company of the West, where the two firms would manage NCB Capital's international equity funds and help in the expansion of its products and services.