At least three Gulf institutions are planning to launch new investment funds targeting equities in the region in the next few months, once potential investors return from their summer holidays.
TAIB Bank, a Bahrain-based offshore bank, is understood to be working on an equity fund which will operate first in the Bahraini market, possibly to be extended in future to the rest of the GCC. The fund’s first customers are expected to be large local institutions which already hold securities on a long-term basis, such as pension funds.
The fund could then be opened to other investors in the future.
Bahrain Middle East Bank (BMB) is working on a fund in partnership with another bank. ‘We are studying setting up an investment fund together with a global financial institution,’ BMB’s general manager Albert Kittaneh said in a recent interview with Al-Alam el-Yom newspaper. ‘This fund will focus on Gulf shares and will be listed on the bourses of the Gulf.’ He did not name the other bank, which is understood to be London-based United Bank of Kuwait (see In Brief, right). Details of the size of the fund are not yet known.
A third institution, Faysal Islamic Bank of Bahrain, has said it will be launching an open-ended Islamic fund in September.
The bank is currently in the process of selecting asset managers for the different global markets where it plans to invest.
This fund would join one of a series of recent launches of Sharia-compatible funds which reflects a search for greater returns by Islamic investors and a softening of religious attitudes towards investment by Muslims in equities (MEED 28:6:96).