Jeddah: The largest asset manager in the Kingdom of Saudi Arabia, NCB Capital, has planned to introduce a range of Irish-domiciled Islamic mutual funds as an attempt to lure the upcoming investors and enhance base of its customers.
According to the senior executives of the asset manager, NCB Capital is going to launch a variety of Islamic mutual funds as it seeks to broaden its investor base and appeal to emerging market investors.
The Jeddah-based firm, which manages $12.1 billion in assets, has launched two funds which invest in Saudi Arabian and GCC (Gulf Cooperation Council) 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, informed media earlier this week.
Future plans call for developing a range of up to 10 funds within 18 months, including a fund that will invest in sukuk, Badran said.
“We have plans for other equity and sukuk concepts,” he added.
He informed that the sukuk fund could materialize in 12 to 18 months, helped in part by favorable sukuk issuance conditions.
NCB Capital, part of unlisted National Commercial Bank – the kingdom’s biggest bank by assets – is targeting each fund to have between $50 million to $100 million 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 $919 billion 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.