Assets under management by Bahrain’s mutual funds industry surged by nearly 115 per cent to over $20 billion during the period from June 2007 to June 2008, according to the latest Central Bank of Bahrain statistics. The number of funds registered and authorised with the CBB rose to 2,636 at the end of June 2008. The net asset value of those funds totalled $20.14 billion.

In comparison, the number of registered funds as at June 2007 was 2,374, with assets under management totalling $9.37 billion.

Of the total assets of the fund industry, assets of foreign funds registered in Bahrain for sale rose 134 per cent to $13.34 billion in June 2008, compared with $5.69 billion in June 2007. The number of such funds totalled 2,502 in June 2008, compared with 2,266 in June 2007.

The investable assets of Bahrain-domiciled funds rose 84.5 per cent to $6.79 billion in June 2008, up from $3.67 billion in June 2007. The number of such funds was up to 134 in June 2008, from 108 in June 2007.

Mohammed Ayman Al Tajer, director of financial institutions supervision at the CBB, said: “We are observing a growing interest from regional specialised financial institutions that are actively involved in the structuring of mutual fund products in particular.  While many of which are focused on investments based in the region, they find an added value in utilising the Bahraini collective investment undertaking regulatory framework for the establishment of their CIU investment vehicles.  This is due to the fact that the Bahraini CIU domiciled vehicle has established a reasonably tested track record for its efficiency and suitability.”

In June 2007, the CBB revamped the CIU regulation, recognising at the time the importance of addressing key areas such as transparency.  This is an acknowledgement to the fact that investors are becoming more conscious of the necessity for CIU products to be transparent.

Meanwhile, the CBB continues to consult industry players on the development of the CIU regulation, as it intends in the near future to further impose a greater level of corporate governance.