Business Custodians debuts first Queensland-based Islamic investment fund - IFN

Business Custodians debuts first Queensland-based Islamic investment fund

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AUSTRALIA: Business Custodians (BC) and the Australian Shariah board for Islamic Finance-Australian Center for Islamic Financial Studies (ASBIF-ACIFS) have successfully launched the Brisbane Islamic Investment Fund (BIIF). BIIF is the first Queensland-based and regulated Shariah compliant investment fund in Australia and is structured as an Australian resident open-ended unit trust. In a statement communicated to Islamic Finance news yesterday, an estimated initial investment of AU$100 million (US$88.51 million) will kick-start BIIF, with a number of projects identified for commencement in March 2014. The fund will be invested solely in Shariah compliant projects and established small to medium-sized businesses, located in both Australia and overseas. It is also expected to utilize some of the excess liquidity of over US$1 trillion in the global Islamic investment funds landscape over the next decade. According to the fund’s information memorandum, 30% of the portfolio will be focused on tourism; 20% on manufacturing and service businesses; 15% on livestock; 15% on solar and clean energy; and 10% on real estate, energy and resources respectively. The investment time frame is set for a minimum period of seven years and targets to achieve an annualized rate of return ranging from 10-12% above the average Reserve Bank of Australia cash rate in each respective financial year. Investment risks will be mitigated primarily by a portfolio spread across a number of acquisitions in different industry segments. As the manager and trustee of BIIF, BC holds an Australian Financial Services License which is strictly regulated by the Australian Securities and Investment Commission, a regulatory body which is recognized worldwide. ASBIF-ACIFS and BC are jointly responsible for regulatory corporate governance as well as ensuring adherence to the investors’ mandate and compliance with Islamic investment criteria.