Banco do Brasil’s collaborates with Islamic Bank of Asia to debut Islamic fund by October

77 days to go Tuesday 1st July 2014 Banco do Brasil’s collaborates with Islamic Bank of Asia to debut Islamic fund by October Daily Cover BRAZIL: Banco do Brasil (BB), Latin America’s largest bank by assets, is planning to launch a Shariah compliant fund by September or October this year, in partnership with Singapore’s Islamic Bank of Asia. The fund will involve stock trading of Brazilian companies listed on the Sao Paulo Stock Exchange (Bovespa) in the Middle East and Asia. Carlos Takahashi, the chairman of BB DTVM, the bank’s resource management division, revealed that an average equity ranging from US$50-500 million within a year is expected for the fund. The fund will trade in shares of Brazilian commodity, energy, oil and gas, mining and retail companies. BB’s delegates have met with investors from the UAE, Singapore and Hong Kong earlier in May to assess potential interest in the new fund. Apart from the Middle East, some Asian countries with large Muslim populations, such as Indonesia, India, Singapore and Malaysia have also indicated an interest. As partner, IBA will provide support to its Brazilian counterpart in certification of the stock traded. IBA will also assist to define the rules for the fund and analyze whether its asset composition is Shariah compliant. The new fund will be managed in Brazil and marketed by partner brokerage houses in the respective regions. In the Middle East, the stock will be sold by London’s BB Securities; and in Asia, the trader will be a brokerage firm established by the Brazilian bank in Singapore a year ago. Reports have indicated that BB invested one year of careful work to build a premium portfolio, which is mostly concentrated on Brazilian commodities and the mining, oil and gas sectors. In addition to these being Shariah compliant sectors, BB believes such stocks would have a positive outlook in the long-term. According to Takahashi, about 20 companies have been approved for their shares to be traded by the Islamic fund. 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