Saudi’s Itqan Capital To Boost Islamic Finance Business

Islamic investment firm Itqan Capital, based in the Saudi Arabian city of Jeddah, plans to expand its investment and advisory activities in the Kingdom after it received regulatory approval to boost its capital, its chief executive told Reuters.

Local investment firms are poised to see an uptick in activity as the Saudi stock exchange, the Arab world’s biggest, opens to direct investment by foreign institutions early next year.

The firm will increase its capital by SAR100 million ($26.6 million) to SAR173.4 million by the end of October, said Adil Dahlawi, managing director and chief executive of Itqan Capital, part of the Al Baraka Banking Group.

Last month, Itqan signed its first mandate with Saudi Arabian Airlines, advising on treasury and cash management of the government-owned airline.

Itqan currently manages four sharia-compliant funds: a money market fund and three real estate funds.

“New product launches are scheduled this year with two funds in the pipeline, the first of which is a private equity fund investing in the Saudi education market,” Dahlawi said.

About half of all assets under management in Saudi Arabia follow Islamic investment principles, and the market could see a range of new products from local and regional fund managers to cater to such investors, he added.

The capital increase will see Al Baraka Banking Group become the majority shareholder in Itqan with a stake of around 58 per cent, while Al Baraka Islamic Bank will hold an additional 25 per cent, said Dahlawi.