Business

National Bonds record robust investor growth

Holders increase by 9% as cumulative returns rise to 26.45%

  • By Aya Lowe, Staff Reporter
  • Published: 00:00 January 31, 2011
  • Gulf News

Dubai: National Bonds Corporation, a UAE-based Sharia-compliant savings scheme, has achieved a 9 per cent increase in bondholders, bringing the number up to 610,775.

By a rough estimate, this could be equivalent to nearly 10 per cent of the UAE's total population, or about 40 per cent of Dubai's.

This positive growth was reflected across various segments of the population — the number of women bondholders increased by 11 per cent, men by 12 per cent and expats by 11 per cent.

Future funds

"If you compare it with the banks, National Bonds have a better annual rate of profit," said Mahmoud Al Twissi, a holder of National Bonds in a previous Gulf News interview. The father of two daughters and a son plans to open an account in his wife's name. "The savings in the bonds could very well serve as future educational funds for my children," he said.

The companies investing in National Bonds through the National Bonds Employee Saving Scheme increased 23 per cent.

National Bonds also stated that it distributed a 3.78 per cent profit last year, a year-on-year growth of 6.3 per cent. With this year's results, the cumulative returns since inception reached 26.45 per cent. The Profit Bonds for 2010 will be issued effective January 1, 2011. The attractive rates have led to an increase of 77 per cent of repeat purchases. Long-term bond-holders of more than a year is now at 86 per cent, an increase from 79 per cent in 2009.

Market trends

"While the market slowly recovered from the effects of the financial downturn in 2010, National Bonds surged ahead to achieve growth in its performance and once again provide one of the best returns in comparison to all other savings schemes in the UAE.

"Our investment team was able to identify market trends ahead of time, thereby allowing us to maximise our returns by securing the best rates. We were also able to ensure that our portfolio has the flexibility to allow us to grab opportunities the market presented," said Mohammed Qasim Al Ali, chief executive officer of National Bonds Corporation.

  • 11% rise in women bondholders
  • 86% have been bondholders for over one year

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