Unicorn unaffected by global credit crunch

Dubai: Even as financial institutions across the world are tumbling like ninepins and companies are being forced to postpone product launches, Bahrain-based Unicorn Investment Bank (UIB) hopes to mop up $50-$70 million (Dh183-Dh257 million) with its new mutual fund targeted at investors in the Middle East and North Africa (Mena) and Turkey that will be launched this year.

The confidence stems from the fact that UIB is an Islamic investment bank with almost of all its operations Sharia-compliant.

"The biggest financial institutions crashed because of a small department within them that dealt with derivatives. Since we are a Sharia-compliant company, we are not allowed to deal with derivatives or to hedge.

"That keeps us protected even in these times of worldwide large-scale crashes," Najeeb Fayyad, Managing Director (asset management) of UIB, said.

UIB is also looking at inorganic growth through partnerships in several Eastern European countries such as Poland, Romania and Bulgaria. It has its eyes set on the Spanish market, too.

UIB is planning to launch a real estate private equity fund in Europe whose size will be about $200-$250 million. The company is also planning to float a strategic equity fund in Turkey that is expected to be worth $100 million.

"Interestingly, India offers plenty of opportunity for us. It has a wide variety of products in several growing sectors. It is also growing at close to nine per cent. That makes it attractive," Fayyad said.

"We have been talking to local private equity players. Hopefully we will be able to enter the market soon."

Founded in 2004, Bah-rain-headquartered UIB has a presence in the US, Malaysia, the UAE, Turkey and Pakistan.

Fayyad feels that as of now the world has seen only the tip of the subprime iceberg. He believes almost all of 2009 will remain overcast under the credit crunch cloud.

The confidence stems from the fact that UIB is an Islamic investment bank with almost of all its operations Sharia-compliant.