SICO teams up with Wafra Investment to launch new sukuk fund
MANAMA, October 22, 2023
SICO, a leading regional asset manager, broker, market maker and investment bank (licensed as a wholesale bank by the CBB), has announced the launch of a new sukuk fund in partnership with Wafra International Investment Company, the wealth management provider.
Elzaad Sukuk Fund is a moderate risk fund that will invest in a diverse portfolio of sukuk and other sharia-compliant fixed income instruments issued by sovereign, quasi sovereign, and corporate issuers globally.
The fund will focus on the Mena region, offering clients the opportunity to penetrate global markets. Securing monthly liquidity for investors, the Fund begins investments at a minimum of $100,000, with an expected rate of return ranging from 5.5% to 7.5%.
Under this deal, Sico will act as the fund manager for Elzaad and Wafra as the investment advisor, with the Central Bank of Bahrain as the regulator.
The Fund’s primary objective is to maximize total return over the medium to long-term, including profit income and capital appreciation.
It is largely based on a conservative investment approach, featuring low volatility and steady income, with access to the best performing Sukuks globally. To ensure the prudent governance of the Fund, Shari’ah Review Bureau W.L.L. will be acting as the Shariah advisor, HSBC Bank Middle East as the custodian, and Trowers & Hamlins as the international legal advisor.
"The launch of Elzaad Sukuk Fund reflects SICO's commitment to diversifying investment opportunities for clients, leveraging our asset managers' expertise for stable returns and moderate risk, and expanding our offerings of Shariah-compliant investments," said Najla Al Shirawi, CEO of Sico.
"We are confident that this Fund will meet the needs of investors in ever-changing markets, generating long-term value and broadening clients’ portfolios across geographies and asset classes," she added.
Investor demand for sharia-compliant investments has been flourishing, with the Bloomberg Sukuk index rising 3.63% in the last five years.
Sukuks have a track record of outperformance in rising interest rates environment and volatile environments compared to bonds, due to their stability and low correlation with other asset classes.
SICO’s Sovereign & Quasi Sovereign Fixed Income Strategy has been named the Best Mena Fixed Income Fund Strategy by the Bonds, Loans & Sukuk Middle East Awards 2023, said Al Shirawi.
"SICO was also recently named Best Sukuk Manager and Best Asset Manager in Bahrain by the Global Investor Group MENA Awards 2022. It's GIPs Compliant Sukuk Composite ranked in the top quartile versus peers on a one-year, three-year, and five-year basis," she stated.
"SICO adheres to the highest industry investment standards through the adoption of its Asset Management Code of Conduct," she added.-TradeArabia News Service
