29 June 2016
MANAMA - Securities & Investment Company (SICO), the Investment Manager for the Bahrain Liquidity Fund, announced Tuesday the names of the seed investors in this newly-launched fund.
The four seed investors, who are prominent Bahrain-based financial institutions, namely Osool, BBK, Bahrain Mumtalakat Holding Company (Mumtalakat) and NBB have aligned interests in enhancing the vibrancy and depth of the Bahrain Bourse. They have supported the initiatives from its initial stages, and invested equally in the Fund by a combination of cash and shares in kind.
The Chief Executive Officer of Osool, the investment arm of the Social Insurance Organization and the Military Pension Fund, Sheikh Abdulla bin Khalifa Al Khalifa, said: "Healthy capital markets will be beneficial for Bahrain's economy by helping to attract additional local and foreign direct investments to the Kingdom. As such, we are delighted to play our role as seed investors of the Bahrain Liquidity Fund; and to support all initiatives and reforms by the Central Bank of Bahrain and the Bahrain Bourse to enhance the depth and competiveness of the local stock exchange."
BBK Chief Executive Reyadh Yousif Sater said: "BBK has constantly been a main supporter of the Bahraini economy and our participation in the Bahrain Liquidity Fund is a yet another milestone that we have taken to cement our support to the local capital markets. We believe our collective efforts will enhance trading volumes, and provide a more accurate price discovery process for listed companies, in the future."
Chief Executive Officer of Mumtalakat Mahmood Hashim Alkooheji said: "We are pleased to be one of the seed investors in the Bahrain Liquidity Fund.
As part of our commitment to support initiatives which drive local economic growth, we have invested in this fund in an effort to enhance local capital markets. This fund will be one of the key pillars which will attract more investors to Bahrain's stock market, strengthen liquidity, and ultimately result in a positive impact on the Kingdom's economy."
NBB CEO and Director Abdulrazak Hassan Al Qassim said: "Bahrain's equity market suffers from low free float, and stocks are thinly traded on the exchange. This poses a challenge for investors. The launch of this fund is aimed at solving these issues by increasing liquidity, volumes traded and expanding the investor base. We are truly delighted to be part of this initiative in helping the Bahrain Bourse to grow, strengthening the financial sector and the economic future of the Kingdom."
The Bahrain Liquidity fund received subscription in cash and shares in kind from these four institutional investors, In addition to a seed investment by SICO as the fund manager. With assets in excess of $100 million, it has the scale to make a significant impact on market liquidity, improve valuations over the long term and enable it to increase gradually the free float for stocks traded on the Bourse.
The fund forms part of a series of initiatives and reforms by the Central Bank of Bahrain and the Bahrain Bourse, which are designed to deepen Bahrain's capital markets and make them more attractive to investors. They include the introduction of a Bahrain Islamic Index (the first in the GCC), the active trading of government bonds and sukuk, a minimum free float requirement for issuers, and a planned growth companies market which is expected later this year. At a time of tightening global liquidity, such measures will help diversify local funding sources.
© The Saudi Gazette 2016