- Assets under management increased by 9% to AED 7.8 billion
- Regular savers funds grew by 13%
- Khalifa Al Daboos: Our prudent investment strategy pays off
- UAE’s saving culture unaffected much by world economic conditions
Despite some challenging global macro-economic conditions, National Bonds has continued to show resilience, with its assets and client size posting positive growth. National Bonds’ assets under management increased by 9% to AED 7.8 billion in 2019, according to the results published by the UAE-based financial and Sharia-compliant investment company.
The assets included mainly Wakala Deposits (38%), Real Estate – Yield Generating (27%) and Sukuk (25%), according to National Bonds, which is owned by the investment arm of the Dubai Government, the Investment Corporation of Dubai (ICD).
It also announced that, for those with holdings of AED1 million or above, earned an average return on investment (ROI) of 3.89%, one of the highest in the region. Meanwhile, the current market EIBOR rate for 1 year is 1.43% in the market.
Holdings that the range between AED 350,000 to AED 1,000,000 earned an average of 3.08%. The range between AED 150,000 to AED 350,000 earned an average ROI of 2.74%. The range between AED 100,000 to AED 150,000 earned an average ROI of 1.40%. The range between AED 50,000 to AED 100,000 earned an average ROI of 1.38%.
Holdings in the lower bracket, ranging between AED5,000-50,000, would get a 1.30% as an average ROI, which is still higher than what’s offered by other financial institutions.
The company attributed the positive results to its low-to-medium risk investment policy, which has shielded it from the negative repercussions of unfavorable economic and financial developments around the world.
National Bonds witnessed more customers opting to save in the fund of regular savers signing up between December 2018 and 2019 growing by 13%. Female and minor savers increased by 7% and 8%, respectively, during the same period, while the number of male savers grew by 12%. Also during the same period, the number of employers that have chosen National Bonds’ Employee Savings Programme has likewise increased by 29%.
All of these positive results are a testament to the fact that National Bonds’ strategy is working, and that its competitive rates have proven to be an attractive proposition for the local populace.
Since its inception, National Bonds has distributed 5.14 million prizes worth AED612 million, while 1.53 million prizes totaling AED212 million landed in the pockets of UAE nationals.
National Bonds always takes into consideration the macro-environment when it comes to managing and diversifying its investment portfolio, to preserve bondholder’s funds while ensuring positive returns for its investors
National Bonds’ Chairman, Khalifa Al Daboos, said he is proud of the results, especially since they were achieved while the world economy is going through some major challenges.
“This proves that our fiduciary low-to-medium-risk strategy is paying off,” he added.
“Besides, National Bonds always takes into consideration the macro-environment when it comes to managing and diversifying its investment portfolio, to preserve bondholder’s funds while ensuring positive returns for its investors.”
Despite changing world economic conditions, the UAE’s saving culture remained robust in 2019, compared to the year before, Al Daboos said.
“This means that the UAE society remains aware of the importance of saving money, as well as the country’s ability to weather any economic shocks,” he added.
Last year, the company focused on two main things: increasing the number of companies joining its saving and investment programs, such as “Employee Savings Programme”; and growing the number of its investors by launching attractive tailored programs, such as Booster, which provides regular income through competitive returns up to three years
For his part, National Bonds’ CEO, Mohammed Qasim Al Ali, said the company’s results underscore that its strategy is on the right track.
“Last year, the company focused on two main things: increasing the number of companies joining its saving and investment programs, such as “Employee Savings Programme”; and growing the number of its investors by launching attractive tailored programs, such as Booster, which provides regular income through competitive returns up to three years,” he added.
These programs, as well as the others that are tailored to customer needs, are on top of the company’s programs in the pipeline, Al Ali said.
The results, especially the increase in the number of female and minor savers, also showed that the UAE’s society is getting more and more aware of the importance of saving money to improve their financial wellbeing. Al Ali said.
“This awareness must be enhanced further because saving plays a key role in safeguarding individuals and families against emergencies and it enables them to reach their financial goals in life,” he added.
“While it aims to continue establishing itself as a household brand for savings in the industry, National Bonds will also continue to encourage more UAE nationals and expatriates to join in the savings drive, so that eventually, each and every single person in the country will become a saver.”