Seed investors revealed for $100m Bahrain Liquidity Fund

Mumtalakat, Osool, BBK and NBB take part in fund aiming to inject greater liquidity into stock exchange
Seed investors revealed for $100m Bahrain Liquidity Fund
(Getty Images)
By Staff writer
Tue 28 Jun 2016 03:24 PM

Securities & Investment Company (SICO), the investment manager for the Bahrain Liquidity Fund, has announced the names of the seed investors in the newly-launched fund.

The $100 million fund has been launched in Bahrain with the aim of injecting greater liquidity into the country’s stock exchange.

The four seed investors – Osool, BBK, Bahrain Mumtalakat Holding Company (Mumtalakat) and NBB – have aligned interests in enhancing the vibrancy and depth of the Bahrain bourse, SICO said in a statement.

They have supported the initiatives from its initial stages, and invested equally in the fund by a combination of cash and shares in kind, it added.

Shaikh Abdulla bin Khalifa Al Khalifa, CEO of Osool, the investment arm of the Social Insurance Organisation and the Military Pension Fund, said: “Healthy capital markets will be beneficial for Bahrain’s economy by helping to attract additional local and foreign direct investments to the kingdom. As such, we are delighted to play our role as seed investors of the Bahrain Liquidity Fund.”

The fund forms part of a series of initiatives and reforms by the Central Bank of Bahrain and the Bahrain bourse, which are designed to deepen Bahrain’s capital markets and make them more attractive to investors.

They include the introduction of a Bahrain Islamic Index, the active trading of government bonds and sukuks, a minimum free float requirement for issuers, and a planned growth companies market which is expected later this year.

Reyadh Yousif Sater, BBK chief executive, added: “BBK has constantly been a main supporter of the Bahraini economy and our participation in the Bahrain Liquidity Fund is a yet another milestone that we have taken to cement our support to the local capital markets. We believe our collective efforts will enhance trading volumes, and provide a more accurate price discovery process for listed companies, in the future."   

Mumtalakat CEO Mahmood Hashim Alkooheji described the fund as "one of the key pillars which will attract more investors to Bahrain’s stock market, strengthen liquidity, and ultimately result in a positive impact on the kingdom’s economy" while NBB CEO and director Abdulrazak Hassan Al Qassim said: “Bahrain’s equity market suffers from low free float, and stocks are thinly traded on the exchange. This poses a challenge for investors. The launch of this fund is aimed at solving these issues by increasing liquidity, volumes traded and expanding the investor base.”

The Bahrain Liquidity Fund received subscription in cash and shares in kind from these four institutional investors, In addition to a seed investment by SICO as the fund manager.

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