Bahrain bank launches new Shari’ah trade fund

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Ibdar Bank, Bahrain’s wholesale Islamic Investment bank, has announced the launch of the Barak Ibdar Shari’ah Trade Finance Fund, a parallel fund to the highly successful Barak Trade Finance Fund, the bank announced in a press release.

Commenting on the announcement, Ahmed Al-Rayes, Acting Chief Executive Officer of Ibdar Bank, said, “The bank is pleased to partner with Barak Fund Management, a highly experienced and award winning specialized trade finance manager in our role as the exclusive placement agent for the Barak Ibdar Shari’ah Trade Finance Fund in the GCC.

“We have launched this fund, a parallel Shari’ah fund of the Barak Trade Finance Fund, which since its inception in 2009 has had a straight seven-year positive record with 168% total return and an average of 13% return to investors per year, in response to our clients request for a liquid investment product with high returns.”

The open-ended monthly subscription US dollar fund, with quarterly redemption, will invest in African commodities and general trade finance transactions such as import, export or general merchandising related investments. It is targeting a 10% return net-of-fees for investors.

Strong risk-adjusted returns

Co-founder and Joint-Chief Investment Officer for Barak, Mr Prieur Du Plessis, said, “Barak has been looking to launch a Shari’ah fund off the back of its flagship Structured Trade Finance Fund for some time in the GCC region, and the strategic partnership with Ibdar Bank has now actively afforded this opportunity. Given the Middle Eastern region’s historical familiarity with trade and finance, Barak is particularly optimistic about the fund’s outlook and believes it will be able to provide strong risk-adjusted returns for its investors on the back of its growing deal pipeline.

We are excited to be working alongside Ibdar Bank and look forward to a successful relationship on both the fund management and investor relations side of the Barak Ibdar Shari’ah Fund.”

Hasan Juma, Director Asset Management for Ibdar Bank, said, “We are very pleased to offer our investors across the GCC this opportunity. The stable track record and low-volatility characteristics of the strategy encourages Shari’ah conscious investors to add this investment to their portfolios and take advantage of the attractive trading margins and returns that are uncorrelated to other assets or markets.

“There are very few short-term liquid opportunities available to investors looking for Shari’ah compliant products. The Barak Ibdar Shari’ah Trade Finance Fund provides an alternative investment product that will allow Shari’ah conscious investors throughout the GCC access to short-term liquidity with relatively higher returns”.

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