Saudi-based International Trade Finance Corporation (ITFC) will team up with US fund manager Federated Investors to launch a sharia-compliant trade finance fund.
The fund, which will launch later this year, is expected to raise $300 million on its first close and will be a private offering available to ITFC’s qualified investors.
ITFC, which is part of the Islamic Development Bank Group, will manage the fund. Federated Investors’ UK arm will provide “strategic input”.
The portfolio will focus on energy-related trade finance, structured trade, export/import finance, supply chain financing and project finance assets of sovereign entities across member countries of the Organisation of Islamic Cooperation, according to ITFC.
The two firms have worked together on Islamic trade finance transactions before but the planned fund launch is the first joint initiative of its kind and “paves the way to develop other business opportunities together”, said ITFC chief executive Hani Salem Sonbol.
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