Bahrain's Al-Ahli Commercial Bank has set up a joint venture bank with Switzerland's ED&F Man Investment Products to sell investment funds in the Bahraini market. The Man-Ahli Investment Bank, which has just received a restricted investment banking licence from Bahraini regulators, will initially be a small operation with capital of $5 million but could expand in a few years into providing a wider range of services.

Al-Ahli, one of Bahrain's four commercial banks, has been distributing funds created by the Swiss firm for three or four years, according to general manager Michael Fuller (see Bahrain). The two institutions formalised this link last May by setting up a joint venture investment company with capital of $2 million. This company is now being wound up and replaced by the new investment bank.

'It's the first time they [ED&F Man] have entered into a formal joint venture, which is slightly flattering,' says Fuller. 'The strategic value to us is to improve the overall proportion of [our] fee income.' The new bank will distribute capital-guaranteed funds created by the Swiss partner, as well as the funds of different providers. In late 1998 or 1999, it may expand its operations into other Gulf countries. 'We have longer-term ambitions to provide other investment banking services, such as portfolio management, but at the moment, the need is to get this new baby into its infancy,' says Fuller.