Emirates NBD fund nets over $100m
Dubai, November 26, 2011
Top UAE bank Emirates NBD said the Islamic money market fund of its asset management unit has attracted more than $100 million from investors in the 18 months since launch.
The Emirates Islamic Money Market Fund is part of Emirates NBD Asset Management, one of the top 10 asset management firms in the region.
The fund is a Shari’a-compliant investment that aims to achieve a higher return than traditional Shari’a-compliant bank deposits of similar liquidity. The fund primarily invests in a diversified portfolio of Shari’a-compliant money market instruments.
It has given four-fold returns than would have been achieved by an investor placing money in an overnight deposit during the same period, said a senior official.
Deon Vernooy, senior executive officer at Emirates NBD Asset Management, said: 'In a low interest rate environment, investors need to focus on earning the best profit rates from their liquid assets, and the fund is an ideal vehicle for investors seeking a cash allocation in their portfolio.'
“The Emirates Islamic Money Market Fund was launched based on a belief that conventional and Islamic investors want a liquid strategy that is daily-dealing and captures the higher profit rates offered by Islamic banks. The broad investor base and growing international distribution shows investors want their cash to be professionally managed,” he added.
“The fund’s success lies in a number of investment parameters that ensure suitability of return and liquidity,” continued Vernooy.
“Insurance companies and Takaful operators have been one group of investors drawn to the funds liquid and simple strategy.”
'The fund is a leader in its peer group, ranking in the top percentile of the sector. It places deposits with approved Islamic banks to achieve a return greater than offered by dollar deposit rates,' said the official.
'Every bank that is used in the portfolio passes a rigorous credit and counterparty risk assessment,' he noted.
“Asset growth of the fund is a reflection of the interest shown by international and local investors to the higher profits that can be achieved from investing in Islamic bank deposits,” said Vernooy.
Emirates NBD Asset Management manufactures its own conventional and Islamic products, offering exposure to regional as well as global markets-TradeArabia News Service