Some key developments over the past week provided further confirmation of general expectations that there is a lot of money looking for Shariah compliant investments, amid the landscape where Saudi Arabia, Pakistan and the UAE announced new Sukuk issues to raise over US$2.5 billion.
Sedco Capital launched the public offering of its SC Multi Asset Fund targeting up to SAR1 billion (US$266.5 million) in subscriptions. Kuwait saw National Investment Company get its Second Islamic Real Estate Finance Fund while Warba Bank was licensed by the Capital Markets Authority of Kuwait to operate as a securities broker not registered on the stock exchange for a period of three years.
In alternative investments, XTCC’s Shariah compliant investment ecosystem now features multicurrency carbon credit assets from various validated projects — including renewable energy, nature-based solutions and blue carbon. UK-based CarCrowd is drawing more interest from Middle Eastern investors for its classic car offerings ever since it obtained Shariah certification for its operations.
Distressed property investor Patron Capital revealed plans to launch its first-ever Shariah fund, to attract more investors from the Middle East and extending to Indonesia.
Regulations-wise, Takaful firms have to get creative in how they can invest premiums received to achieve optimal Shariah compliant returns — read more with our focus on Takaful Oman. The Securities and Exchange Commission of Nigeria has issued an exposure on the proposed new rules on the issuance and allotment of securities, including Sukuk, for private companies while the Securities and Exchange Commission of Pakistan released a guide to facilitate Modaraba companies and Modaraba agreements.
Also, new European rules set to go into effect over the next 24 months also have a significant impact on the operations of Islamic funds across the continent.
But there still remain some unusual hurdles for Shariah investments — with minimum size being a factor, especially for larger outfits in Arab nations. As navigating these and more challenges may be daunting, there seems to be a trend of Shariah-focused investors recently preferring to go with professional fund managers.
