Moody’s forecasts ‘steady growth’ for GCC asset management

Gulf_Cooperation_CouncilThe GCC’s asset management industry is set for a decade of steady growth thanks to increased foreign investment and economic diversification. This is the finding of a report from rating agency Moody’s which cites initiatives such as Saudi Arabia’s Vision 2030 programme as a means to stimulate private investment, attract more international investors and ultimately spur more growth in the asset management industry. But the report’s author, senior credit officer Vanessa Robert, also notes that the growth will create other challenges for asset managers “as increased asset flows test their capacity constraints, and as a more sophisticated client base demands a broader range of products and lower fees”. Moody’s estimates the GCC market has $260 billion of assets under management with Saudi Arabia accounting for nearly half that total. The majority ($200 billion) is invested via managed accounts with collective investment vehicles accounting for the remainder. Capacity constraints may be exacerbated by the sector’s concentration on traditional asset classes in local markets, states Moody’s. Consequently, the larger GCC firms that have diversified their offerings to take in alternative and multi-asset investments will have a competitive advantage. The report also notes that while the regulatory environment is improving, there needs to be more rigorous supervision if certain jurisdictions are to compete with Western markets. ©2019 funds global mena

Sponsored Profiles

There’s no doubt that Africa has been seen increasingly as an attractive prospect for inbound investment in recent years, with investors seeing real potential in the continent, particularly in the private equity, infrastructure and real estate asset classes, as it experiences strong economic growth.

Plausible explanations exist for why low-volatility stocks perform better than their high-volatility counterparts.

Aberdeen Asset Management has set up its first Middle East office in the newly established Abu Dhabi Global Market. Andrew Paul, senior executive officer, explains why.

A recent sovereign bond issue from Saudi Arabia underlines the appeal of emerging market investing. What must investors consider when allocating to this asset class? Firas Mallah of BMO Global Asset Management shares his views.

Executive Interviews

INTERVIEW: ‘Financing is the blood of Iran’s economy’

Amid a fresh wave of American sanctions, Romil Patel spoke to Meysam Hamedi, director of financial markets and instruments at Iran’s Securities & Exchange Organization (SEO).

INTERVIEW: Totally mega

In 2016, global consulting firm PWC forecast the emergence of five global ‘megatrends’ in the next two decades. Stephen Anderson, its Middle East clients and markets leader, talks about their...

INTERVIEW: Protecting the investment

Rasmala’s trade finance fund recently passed $100 million in assets. Doug Bitcon, head of credit strategies, explains why he has to be hands-on.

EXECUTIVE INTERVIEW: A natural interest in the topic

Since 2016, Guillermo Ortiz has been a chairman of Latin America’s BTG Pactual. The former central banker of Mexico talks to Nick Fitzpatrick.


Middle East Investor Roundtable 2020: Dimensions of diversification

Investors in the Middle East consider the tools that will be needed to navigate the Covid-19 crisis, the continued appetite for dividend and why it’s all about tech. Chaired by Romil Patel.

South Africa asset management roundtable: Global rebound on ice

Experts discuss the investment implications of the coronavirus pandemic, a delayed rebound in global growth and dealing with South Africa’s energy issues head on. Chaired by Romil Patel in Cape Town.

South African roundtable: Taking the bull by the horns

Our panel discusses Chinese investment in Africa, financial institutions’ contribution to economic sustainability and regulatory concerns. Chaired by Romil Patel in Cape Town.

ROUNDTABLE: Hooked to the global caravan

With the MENA region at a tipping point, our panellists talk about economic diversification, the impact of regulation and the delayed Saudi Aramco listing. Chaired by Romil Patel in Dubai.