Manama: Bahrain’s pioneering contribution to the on-going development of GCC capital markets during 2016, came under the spotlight yesterday at the 2nd Annual Middle East Asset Management Forum, which took place at the Gulf Hotel, Kingdom of Bahrain.
Naveed Ahmed, a senior portfolio manager with Securities & Investment Company (SICO) Bahrain has been at the forefront of initiatives to develop the region’s capital markets.
“These include the introduction of new market making rules and guidelines by the Bahrain Bourse (BHB) on par with international professional standards, and the appointment of the first two ‘approved’ market makers,” he pointed out. “Another significant development was the launch of the Bahrain Liquidity Fund, with the objective of improving liquidity on the Bourse. This has proved to be extremely successful, with average traded value on the BHB during the fourth quarter of 2016 increasing fourfold compared with the previous year, and tripling during the first three months of this year.”
He also highlighted the listing on the Bahrain Bourse of the first Sharia-compliant real estate investment trust (REIT). “Another interesting development was the launch of the Bahrain Investment Market in March 2017, designed to enable small-to-medium enterprises (SMEs) to list and raise capital on an alternative market with less stringent regulatory requirements than the main bourse. This is similar to the recently-launched Parallel Market (Nomu) in Saudi Arabia, which has the same objectives,” he noted.
Regarding the future outlook for the regional investment industry, he considers the lack of collaboration among GCC financial centres to be a real challenge. “We need to create a unified regulatory framework similar to UCITS (undertakings for collective investments in transferable securities) in Europe, which allows funds domiciled in any country to be sold across borders. Adopting such a ‘passporting’ approach would enable the industry to realise its full potential and attract increased investor flows. While the MENA investment pool totals approximately US$ 4.5 trillion, only 10 per cent of this finds its way to regional asset managers. Moreover, the regional investment industry is very fragmented, with over 200 managers responsible for around US$ 300 billion in assets,” he pointed out.
The Forum, which was hosted by the Global Investor Group in partnership with the Central Bank of Bahrain, and sponsored by SICO, brought together asset management professionals, policymakers and regulators, and industry experts, to discuss the most pressing issues facing the regional asset management industry and investment community.
With total assets under management exceeding US$ 1 billion as at 31 March 2017, SICO is one of the largest boutique investment managers in the region, outside Saudi Arabia, focused on managing GCC equity, fixed income and real estate assets. Its success stems from a disciplined investment strategy and conservative approach; one of the most stable and highly-professional asset management teams in the industry; and the quality of its comprehensive research capability.
