First global Ucits sukuk fund launch

A partnership between CIMB Group Holdings Berhad and Principal Financial Group has launched the first global sukuk Ucits fund in Ireland.

The partnership, CIMB-Principal Islamic Asset Management, said the fund aims to maximise total returns over the medium to long term through a combination of capital growth and income. Denominated in US dollars, it invests primarily in Islamic bonds (sukuk) issued by governments, corporates or supranational entities located globally.

The fund, managed by the firm in Malaysia, will appeal to those investors looking for ethical investments with stable returns in major currencies by accessing sukuk of leading issuers, mostly sovereign and sovereign-related credits in the Middle East said the firm.

 According to the firm, the fund offers an attractive option for fixed income investors who are looking for a viable way to invest more broadly in Middle East and North Africa fixed income and can appeal to Shariah-compliant and conventional investors.

“Global sukuk issuances have witnessed a rapid growth and we have seen increased interest from European investors in sukuk funds over the past few years and now, these investors can access a global sukuk fund with a diversified core portfolio of investment grade [US dollar] denominated securities,” said Nick Lyster, global head of wealth advisory services at Principal Global Investors.

The fund will be offered to investors for a minimum investment of $1,000 (€949). The Shariah adviser for the fund is CIMB Group Holdings Berhad.

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