Jeddah-based investment firm Sedco Capital plans to register its Islamic funds in Switzerland and distribute them through tie-ups with global private banks, part of efforts to diversify its client base outside Saudi Arabia.

Sedco Capital, a fully owned subsidiary of Sedco Holding, said it had incorporated environmental, social and governance (ESG) principles into two of the equity funds, widening their appeal to include ethically minded investors in general.

Islamic funds follow religious principles such as bans on alcohol and gambling, similar to filters used by ESG funds. Sedco Capital hopes this will allow its funds to be marketed to investors beyond traditional Islamic areas in the Middle East and southeast Asia.

The firm aims to be able to source two-thirds of its assets under management from outside Saudi Arabia in four to five years, according to chief executive Hasan Aljabri.

"We are creating strong strategic relationships with private banks to distribute our products. We are about to register our funds in Switzerland and sign two agreements with established private banks," he said.

"We aim to have one signed by October and the second one by December, in the meantime also signing with other regional-oriented institutions."

Sedco Capital's two ESG funds, launched in May last year, have $230 million in assets and are managed by Stockholm-based Informed Portfolio Management. - Reuters