MANAMA: With high growth prospects in the asset-management industry, the GCC mutual fund industry is expected to double in size to around $200 billion by 2012, according to Securities and Investment Company (SICO), the Bahrain-based regionally focused investment bank. “The long-term prospects for the regional asset-management industry remain positive,” SICO said in a report released yesterday.
“The estimated size of the GCC asset management industry is around $90-100 billion of which GCC equities account for around $10-20 billion. According to estimates, the GCC mutual fund industry is expected to double in size to around $200 billion by 2012,” it said.
The report added that the market is still in its infancy.
“Significant potential remains to be tapped, as the assets under management as a percentage of gross domestic product is around 8 percent, well below that of the developed and emerging markets. In Europe, the equivalent percentage is 63 percent, and for the US it stands at 115 percent,” the report added.
The report also said that the increasing number of funds being rated by independent institutions such as Standard & Poor’s is helping to grow the regional asset management industry.
“Within the region, there are four main types of investors: Retail investors, high net-worth individuals, family offices and institutional investors. Retail and high-net-worth individuals have traditionally dominated the regional investment market, but the last few years has seen the emergence of institutional investors, including sovereign wealth funds, pension funds and family offices, who bring a greater degree of investment sophistication to the market.
Inflation falls
Inflation in Bahrain fell to 3.3 percent in April from 4.3 percent in March, according to statistics released by Central Informatics Organization.
In March, inflation slowed to 4.3 percent compared with 4.7 percent the previous month as inflationary pressures across the region continued to ease.
April’s decline in inflation numbers was attributed mainly to the drop in the cost of food and non-alcoholic beverages.
