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GLOBAL: IFN previously
discussed the potential seismic change the implementation of the ASEAN CIS
Framework – a fund passporting scheme similar to Europe’s UCITS platform –
could bring to the Islamic funds industry (See IFN Report: ‘ASEAN CIS: A
much-needed impetus for regional Islamic cross-border fund activities’)
during which we highlighted Malaysia’s prime position to lead the
development and internationalization of the Shariah funds segment. True
enough to our predictions, the country, which is also the world’s largest
market for Islamic funds (along with Saudi Arabia), is the first among its
neighbors to further the Islamic finance agenda by leveraging this
infrastructure to tap not only the ASEAN region but also that of Greater
China.
Maybank Asset Management (Maybank AM) and Maybank Islamic Asset Management
has launched the Maybank Bosera Greater China ASEAN Equity-i Fund, the
first Shariah compliant fund to be introduced under the ASEAN passport
scheme. Offering investment opportunities across three different classes in
two different currencies (Malaysian ringgit and US dollar), the open-ended
fund gains both retail and institutional investors exposure to the emerging
markets of Southeast Asia and China.
“We will maintain a minimum of 35% of the fund’s net asset value each to
Greater China and ASEAN equities markets, while between 2% to 30% will be
invested in Islamic liquid assets including Islamic money market
instruments as well as placement in Islamic deposits for liquidity
purposes,” explained Nor’ Azamin Salleh, CEO of Maybank AM Group, on the
fund’s investment strategy.
The fund is a culmination of the partnership between Maybank AM and Hong
Kong’s Bosera International, a subsidiary of Shenzen-based Bosera Asset
Management, and is expected to realize 7-12% in annual returns on a
three-year rolling basis.
With an estimated Muslim population of over 23 million, which is bigger
than that of Malaysia and the UAE combined, and paired with the fact that
it is the world’s fastest-growing major economy (and largest after the US),
China presents a compelling and lucrative proposition for Islamic
investments; and the economic giant in recent years have taken note of its
own potential and the opportunities Shariah dollar would bring. Apart from
the landmark sovereign Sukuk issued by Hong Kong last year (with another
one in the making), Chinese brokerage Southwest Securities also forged a
partnership with Qatar International Islamic Bank through which the bank
will mobilize efforts (including designing an Islamic finance framework) to
develop the Shariah financial industry in China.
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