In a region struggling from the effects of a prolonged low oil price, Bahrain’s sovereign investment fund posted stable annual results to buck the gloomy trend.
Mumtalakat, the investment arm of the small Gulf kingdom, says its profits in the year ending on December 31 rose 1% compared with the previous year while the value of its assets was stable at $10.6 billion.
The steady performance compares favourably with other sovereign investment funds in the region such as the Saudi Arabian Monetary Agency (SAMA), which reported just under $600 billion of assets in its monthly results for March, a decline of 15% compared with the corresponding period in 2015.
“Despite challenging global economic conditions, 2015 was a year of continued growth and achievements for Mumtalakat,” says Mahmood Hashim Al Kooheji, chief executive.
The fund’s relatively strong performance may reflect the difference in its model compared with other Gulf sovereign funds. Unlike SAMA, which invests across a wide range of asset classes, Mumtalakat is structured like a private equity fund, buying and holding stakes in industrial companies.
Mumtalakat’s holdings include Gulf Air, Bahrain’s national carrier, which saw its losses fall by more than half last year, contributing to the fund’s rise in profits.
In an interview last year, Al Kooheji predicted that Mumtalakat’s structure would help to protect it from the effects of a continued low oil price.
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