GCC asset managers expect stronger inflows, demand for ESG and Islamic investing

Moody's survey shows half of respondents expect sales of Islamic products to grow

  
Image used for illustrative purpose.

Image used for illustrative purpose.

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Asset managers in Gulf Cooperation Council (GCC) countries expect increased inflows over the next 12 months amid growing demand for Islamic and environmental, social and governance (ESG)-compliant investments, according to Moody's 2021 survey of chief investment officers (CIOs) from eight leading GCC fund firms.

"Half of CIO respondents expect double-digit growth in net inflows, and another 33 percent foresee a high single-digit increase," Vanessa Robert, VP-Senior Credit Officer at Moody's Investors Service, said in a report on Monday.

"Improved investment results and stronger fees, already comparatively high in the GCC region, will further support revenue growth."

The survey found 38 percent of respondents expect a significant increase in demand for ESG-compliant investment products.

Half of respondents expect sales of Islamic products to grow more rapidly than sales of conventional investments in the next year. The rising demand reflects the GCC region's large Muslim population, and the industry's efforts to expand its range of Islamic investment options, the report said.

On the downside, respondents' optimism was tempered by worries over geopolitical tensions, the economic impact of the pandemic, and volatile oil prices.

(Writing by Brinda Darasha; editing by Seban Scaria)

brinda.darasha@refinitiv.com

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