NBK launches fund for Thahabi clients

National Bank of Kuwait (NBK) yesterday launched dollar-denominated "Thahabi Ijara Fund VI" to meet the needs of its Thahabi customers for low risk investments that generate a consistent monthly income and which satisfy the requirements of local and international Shariah boards.

The fund is expected to offer 6.5 per cent return per annum.

NBK's Assistant General Manager, Consumer Banking Group, Adel Al Jenaee, said the fund will invest all of its assets in the purchase of equipment or purchase portfolios of equipment, and lease this equipment to a variety of tenants. It will invest in high quality leases that deal mainly with the largest 1000 companies in the US and companies with high credit quality. The equipment portfolios of the fund in terms of type and tenants are diversified, thus reducing the risk rate. The entire portfolio is invested according to Islamic Shariah principles and under the supervision of the Shariah board.

The fund is limited to Thahabi customers and the fund's subscription period has stated on June 6, 2010 and lasts for four weeks. It is possible to close the subscription period before the end of term in depending on the demand.

Qualification for Thahabi package is subject to meeting the minimum deposit criteria of KD30,000 (Dh377,363) in any interest or non-interest bearing account, or a minimum continuous monthly salary transfer of KD1,500.

Meanwhile, the investment arm of NBK, NBK Capital, hopes to close two more private equity deals this year in Egypt and Saudi Arabia.

"We aim to close at least two more deals in our NBK Capital Equity Partners Fund during the second half of this year," Amjad Ahmad, Senior Managing Director of Alternative Investments at NBK Capital, said.

"Around $100 million is available for investment in this fund. We are also beginning to review another transaction in Turkey," he added.

NBK Capital has more than $200m available for deployment in its alternative investment business, explained Ahmad.

"We're targeting companies in the food sector [production and distribution], consumer infrastructure [health care and education]. We are also looking at oil and gas services," he said, adding that Kuwait, Egypt, Saudi Arabia and Turkey are the main target countries.

The firm last week acquired a 30 per cent equity stake in Dunya Goz Group, Turkey's largest ophthalmology hospital chain, through the NBK Capital Equity Partners Fund. It also bought a 37.5 per cent stake in Saudi Arabia's Nayifat Installment in November 2008 and a 40 per cent stake in Al Tala'a International Transportation in April 2008. NBK Capital acquired 100 per cent of Turkey's Yudum Foods in 2007.

The $250m fund managed by NBK Capital, is a regional private equity fund specialised in acquiring strategic stakes in companies in the Middle east and North Africa and Turkey. "We expect to fully deploy the existing fund by early next year and we will likely launch a new private equity fund shortly thereafter," said Ahmad. (With inputs from Zawya Dow Jones)

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