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ING to make Malaysia its regional hub for Islamic funds

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Points of Essence:

  • ING is keen to roll out its shariah compliant products in the Asia Pacific with Malaysia as its hub. The company plans to produce and manage the fund locally, and distribute and market it through its 13 offices in the Asia-Pacific. This will take place as early as next year once the approval from BNM is obtained.

KUALA LUMPUR: ING Funds Bhd aims to make Malaysia its hub for syariah-compliant products in the Asia-Pacific.

This is in line with the Malaysia International Islamic Financial Centre’s campaign to strengthen the nation’s position as an international Islamic financial centre.

Chief executive officer and director Steve Ong said the group expected to launch the next syariah-compliant fund overseas early next year once it had obtained Bank Negara approval.

“This fund will not only cater to domestic but also international investors from markets such as China, India, Japan, Hong Kong and the United Arab Emirates.

ING Funds Bhd chief executive officer and director Steve Ong (left) and Citigroup Global Markets Ltd head of structured products sales (ASEAN) and director Lee Shu Weng (right) during the launch of the ING Annual Income Climate Structured Fund in Kuala Lumpur on Wednesday. - Starpic by Azman Ghani

“We plan to produce and manage the fund locally, and distribute and market it through our 13 offices in the Asia-Pacific,” he said after launching ING Annual Income Climate Structured Fund (Climate) yesterday.

Climate is a syariah-based close-ended fund that offers 5% annual income distribution for three years plus potential capital gain with 100% capital preservation in Australian dollar-denominated underlying assets at maturity in 39 months.

Citigroup Global Markets Ltd is the guarantor of the 5% income and the capital invested.

Ong said ING Funds had developed Climate as a “safe” solution for investors following their concern over preserving assets under the current high inflation and uncertain market conditions.

Citigroup Global Markets head of structured products sales (Asean) Lee Shu Weng said Climate aimed to capitalise on companies that focused on alternative, efficient and renewable energy, fuel and transport development and technology.

This include nuclear power, battery, solar, biofuel and hybrid vehicles.

“Climate is based on Citi Climate Change Opportunities Index that contains 10 to 30 global stocks which are selected through stringent criteria.

“These stocks are quarterly rebalanced and must be rated ‘buy’ by Citi Investment Research,” she said, adding that the bulk of the stocks were from the US and European companies.

Next year, Ong said, ING Funds would introduce three or four products but that would depend on the results of its research and the needs of investors. There are no plans for other launches this year.

Currently, the group has RM2.6bil worth of funds under its management and it is on track to achieve its target of RM3bil this year.

Climate has an approved fund size of 500 million units and the entry price is 98.52 sen per unit.

Entry fee is 1.5% of the offer price per unit and the management fee is 1% per annum. The minimum initial investment is RM5,000.


Note: See related article here.


Written by Suapi Shaffaii

September 12, 2008 at 12:58 am

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