Saudi Arabian domiciled investment funds’ overall assets reached SR 88 billion at the end of December 2012, according to the Saudi Arabian Monetary Agency (SAMA) data for 2012. Assets grew by 7.15 percent from the preceding year’s value of SR 82.2 billion.
The domestic assets of 240 investment funds totaled SR 69.8 billion, contributing around 79.3 percent of the aggregate value and a growth of 8.18 percent. Furthermore, foreign assets reflected an increase of 3.36 percent year-on-year basis
By the end of 2012, the number of investment funds decreased to 240 from 249 recorded a year earlier. SAMA reported that the number of subscribers was down by 18,281 or -6.22 percent year-on-year, recording 275,624 subscribers in 2012. The steady decline in subscribers’ number continued to remain from 2007 to 2012. The gradual decrease in the number of investment funds’ subscribers totaled to 150,461 or -35.31 percent during the five-year-period.
SAMA data reported further that 95.4 percent of the total number of funds at end 2012 was classified as open-ended. Total open-ended assets are SR 86 billion, with average of open-ended funds hovering around SR 377 million during 2012.
The funds are likely to be parked in the money market or bond funds, where the level of capital protection is high. Around SR 54 billion assets reflected in domestic and foreign money market instruments and bonds, representing around 62.3 percent of total assets. Domestic money market instruments’ assets of SR 44.87 billion increased by 11.82 percent year-on-year while foreign money market instruments’ assets of SR 6 billion increased by 10.63 percent. Domestic and foreign bond assets together decreased by 30 percent year-on-year basis from SR 5.6 billion to SR 3.89 billion.
Domestic and foreign shares assets representing around 33.55 percent share of the total Saudi domiciled funds’ assets were up by 1.78 billion or 6.4 percent year-on year. Total assets for domestic and foreign shares are reported 29.54 billion at end December 2012 compared to SR 27.76 billion at end December 2011.
— Mushtaq Ahmed is a senior financial analyst at Zughaibi & Kabbani Financial Consultants.
