Banco do Brasil adds to comeback in Islamic funds

jueves 17 de julio de 2014 00:36 GYT

By Bernardo Vizcaino

July 17 (Reuters) - A unit of Brazilian state-run lender Banco do Brasil SA plans to launch its first Islamic fund to help raise the profile of its Singapore unit, joining a growing list of asset managers returning to the sharia-compliant sector.

The last few years have been difficult for Islamic funds as a whole, with Western firms pulling out as slumping equity markets reduced investor interest and local managers often lacking wider distribution capabilities.

The sector is reviving: Islamic mutual funds now hold $58 billion of assets under management, up from $41 billion at the end of 2012, recovering from a low of $36 billion in 2010, according to Lipper data.

Firms such as Threadneedle Investments, Britain's fourth-largest retail fund manager, plan to grab a slice of this by launching a range of sharia compliant funds in Malaysia.

Last year, the Malaysian unit of Britain's Aberdeen Asset Management launched two such funds. Malaysia's RHB Asset Management plans Islamic funds in Hong Kong, Singapore and Indonesia in the coming year.

In turn, Banco do Brasil's asset management division, BB DTVM, will launch its Islamic fund through its three-year old Singapore subsidiary to help it win business in the region.

"We do believe that this is one of the strategies to attract Asian and Middle East investors to help BB Securities Singapore build a more diversified and competitive portfolio," said BB DTVM's chief executive Carlos Massaru Takahashi.

"If we have a clear perception and commitment of some investors about other types of funds, we will launch them."   Continuación...