Shuaa Capital returns back into black

UAE - Asset management and investment banking firm Shuaa Capital returned back into black in the first-half of 2020, posting net profit of Dh5 million as compared to Dh56.5 million loss for the same period last year despite tough market conditions.

But if the mark-to-market losses on portfolio investments are discounted then the first-half net profit totalled Dh164 million.

Assets under management stood at $13 billion at the end of Q2 compared to $12.8 billion in the first quarter of 2020.

Shuaa's investment banking business also continued to increase its focus on capital raising and restructuring mandates while continuing to build on the success of its fixed income trading desk.

During H1, Shuaa acted as lead or co-lead arranger on transactions, raising over $500 million while executing fixed income flow in excess of $1.5 billion.

The investment bank's model remained resilient despite crisis and it was actively involved in capital restructuring and raising mandates in excess of $2 billion.

"We managed to remain profitable in the first six months of 2020 on the back of the dedication and commitment of our employees to continue on our strategic agenda. Whilst Covid-19 as well as the economic and geopolitical challenges will continue to impact overall business and market activity for some time, our business model is calibrated around seizing opportunities across economic cycles, geographies and products," said Jassim Alseddiqi, CEO of Shuaa Capital.

"Our pipeline of investment banking mandates has strengthened, and the launch of scalable new investment funds has commenced," he added.

Shuaa reported an operating income of Dh86 million in Q2, up by 19 per cent quarter-on-quarter.

It also downsized its non-strategic assets, reducing its non-core asset unit by 38 per cent since July 2019, and releasing in excess of Dh128 million of cash through exits.