RIYADH, 17 May 2006 — Assets under management have grown almost fourfold — from SR34.7 billion to SR138 billion — during the last six years. The number of investors shot up from 79,322 to over 663,000, representing an eightfold jump during the same period.
These statistics were released by Kishore Dash, chairman of the Investment Products Committee, at the announcement of the Investment Fund Awards for 2005 at the Faisaliah Hotel on Monday. He said the number of mutual funds had surged by 70 from 134 to 204 during the same period.
A total of 22 awards were announced on the occasion. The fund categories included: money market (SR and USD); trade finance (SR/USD); North American, European, Japan, Asia equities; Global Bond Fund; Fund of Funds: Defensive (Low Risk); Fund of Funds: Balanced (Medium Risk); Fund of Funds: Growth (High Risk).
The following were the categories for local equity and Shariah-compliant funds: Local Equity Fund; Local Equity Trading Fund Global Equity Fund; Shariah Compliant Local Equity Fund; Shariah Compliant Global Equity Fund; Shariah Compliant Fund of Funds: Defensive (Low Risk); Shariah Compliant Fund of Funds: Growth (High Risk); Overall Fund Manager.
There were three sub-categories of awards in each of the main categories-from one to three and five years. There were no entries for the award for the US dollar bond Fund and GCC Equity Fund.
According to Snehdeep Fulzele, in-charge of Research & Investment Advisory at Al-Rajhi Bank, the investment scene in the Kingdom looks healthy, as several initiatives have been taken to boost the investment climate. They include the licensing of ten more new banks and seven new investment-banking licenses in addition to the number of licenses issued by the Capital Market Authority (CMA) for brokerage, asset management and advisory services.
Fulzele pointed out that another positive development was the decision to allow expatriates to invest directly. He said the move for the splitting of shares could go a long way in injecting a new dynamism into the market. “Simplifying investment procedures for non-Saudi resident investors and investor education could also play a useful role in creating stability in the market,” he said.
Banking analysts pointed out that the economic reforms, low inflation (one percent, according to SAMA), political stability, double digit year-on-year growth (13.8 percent in 2003, 16.8 percent in 2004 and 22.7 percent last year) propelled the economy to a new height resulting in a $14.7-billion budget surplus last year.