NCB Capital, a Saudi Arabian investment company with 44 billion riyals ($11.7 billion) of assets, is expanding outside of the region through alliances with TCW Group Inc. and Amundi Asset Management.
NCB Capital plans to start two funds in the second half of 2012 pending regulatory approval managed by TCW and Amundi, said Chief Investment Officer Faysal Badran. TCW and Amundi now manage a combined $550 million of international funds for NCB Capital, the Saudi wealth manager said in a statement on March 24.
“The international funds business is a relative small portion of our business, and that’s why we’re doing this deal,” Badran, who is also NCB Capital’s head of asset management, said in a phone interview yesterday. “We’ve always had international funds but there was a desire to refocus on better performing investment managers last year.”
NCB currently invests a lot of its assets under management in Saudi Arabia and the other five nations in the Gulf Cooperation Council, including Qatar, the United Arab Emirates and Bahrain, Badran said. The unit of the kingdom’s largest bank by assets National Commercial Bank may also start a fund that invests in Islamic bonds in 2013, he said.
“There’s big demand for sukuk, especially given the level of interest rates globally and in the region,” he said. “It’s an issuer’s dreamland, so issuance has been very active.”
Global sukuk sales jumped to $10.9 billion so far this year from $5.16 billion in the year-earlier period, data compiled by Bloomberg show. Average yields on sukuk worldwide fell 38 basis points so far this year to 3.61 percent March 28, the HSBC/NASDAQ Dubai US Dollar Sukuk Index shows.
“Most of our assets under management are generated through wealth management,” Badran said. “We can’t claim to have a global wealth management platform without having a full suite of products.”
Amundi manages 659 billion euros ($876 billion) and is the combined investment arm of Credit Agricole SA (ACA) and Societe Generale SA. TCW has about $124 billion of assets under management and is a subsidiary of Societe Generale.
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