BNP Paribas Investment Partners has launched an Islamic umbrella fund. The Shariah compliant private placement fund aims to outperform US dollar 3 Month Libor by 100 basis points by investing in high quality sukuks - Shariah compliant fixed income instruments- and murabaha - contracts based on immediate sales of assets at a price which includes an agreed cost price and mark-up.

The sukuk and murabaha structures will be mainly issued in Gulf Cooperation Council countries by corporations and governments. The management of this new fund is delegated to Fischer Francis Trees & Watts, the global fixed income specialist of BNPP IP.  

"We are convinced that Islamic investors, although they continue to focus on equities, will benefit from diversification and will turn to other strategies, such as the ones used in this fund. We are keen to develop our Islamic offering and to expand our distribution of these products globally, especially in the Middle East and in South East Asia where we have already seen strong interest," said Tariq Al-Samahiji, chief executive of BNPP in the Middle East. 

Supported by its own Shariah supervisory board, BNP Paribas Najmah was created in Bahrain in 2003 to consolidate the Group’s global offering of Islamic investment solutions in GCC countries. BNP Paribas Investment Partners’ commitment to Islamic investments was further strengthened with the inception of BNP Paribas Islamic Asset Management in Malaysia and the joint venture in the Kingdom of Saudi Arabia with SAIB BNP Paribas Asset Management.

"By using the combined effort of our asset management capabilities in South East Asia and in the Middle East, we will continue to launch new Islamic products to complement our existing strategies, such as the BNP Paribas Islamic Equity Optimiser Funds and EasyETF DJ Islamic Market Titans 100,” said Vincent Camerlynck, global head of business development at BNPP IP.

At 31 December, BNPP IP had assets under management of €305 billion ($395.4 billion).