The most popular and the fastest growing Fund of the UBL is ‘Al-Ameen’ which has grown by around 414 per cent, while total Islamic funds in the country grew by 147 per cent from November 2012 to November 2015, said UBL Fund Chief Executive Officer Mir Muhammad Ali in an exclusive interview with Pakistan Today.
“The mutual fund industry is growing very slowly in Pakistan because of lack of awareness among the investors. Therefore, our total industry size stands at Rs 500 billion out of which Rs 65 billion is held in UBL Fund. Of the total investment in UBL Fund, 40 per cent belongs to Islamic funds,” the Fund’s CEO said.
“Every year, we initiate two to three year plans for the investors and despite the volatile industry, UBL Assets Management Company had so far paid up to 30-60 per cent profits/dividends on its all Funds on maturity,” he said, and added, “We have young investors in UBL Funds and we invest this entire amount in a pool investment so we distribute profits of our investments among all our investors equally. The investors cannot get this kind of high return from any other side. Our industry is good for the small investors as well as the industries.”
There are a total of 200,000 investors in total in the Assets Management Industry. Of these around 30,000 investors are with UBL, Ali said, adding that in the last 12 years, the industry only received 12,000 new investors. Additionally, the total number of active investors of the local bourses is not more than 50,000 to 60,000, he said.
He said that the lower interest rates in the banking industry had benefitted the Assets Management Industry. He said that the next four to five years were crucial for this industry and awareness had to be created among the educated people regarding the assets management companies.
In the past two years alone, UBL Funds has outpaced private sector assets management industry growth by 47 per cent (Nov 30, 2013 to Nov 30, 2015), industry growth by 29 per cent and UBL Funds’ growth by 76 per cent, Ali said.
“Zoom out to three years – Nov 30, 2012 to Nov 30, 2015 – and UBL Funds grew by 36 per cent, whereas the Industry on the whole grew by 3 per cent. During this same three-year period, the Islamic category of UBL Funds – Al-Ameen Funds – grew by 414 per cent, and was the major contributor to UBL Funds growth,” Ali said.
“UBL Fund Managers is an Assets Management Company entrusted to manage money by investing on behalf of our clients, who range from large institutions to individuals who hail from all walks of life,” the CEO of the Fund said.
“UBL Fund is a subsidiary organization of the UBL Bank and was established in 2001. UBL Funds is an industry leader in the private sector, a wholly-owned subsidiary of United Bank Limited, and the only Pakistani asset manager with international presence in the UAE and Qatar.”
“Our promise is to always place investor interest at the forefront of what we do. We provide investment solutions through mutual funds and direct investment advisory to help our clients plan for a better financial future,” Ali said and added that the demand for the Islamic funds had increased over the last few years in Pakistan as investors wanted to invest in Islamic mode of financing to avoid Sood or interest based system. He said that UBL was the only fund manager who cared about where the investors wanted to invest.
In this connection, he said, the UBL had introduced a number of Islamic products and these Funds were very popular among investors in the country as well as those in the UK and in Arab countries.
Ali said that UBL Fund did not invest the investors money in schemes like T-bills of the State Bank of Pakistan (SBP) or any other ‘non-Islamic’ products.
He said that many investors were coming through London offices of the UBL Funds including the Islamic Funds. The Fund also received investment from the US through its London office as they were unable to open a branch in New York or any other city of the US because of strict regulations of the US government on mutual funds industry.
He said that the UBL had 22 different funds with an investment of Rs 65 billion and had become the largest private funds manager in Pakistan, behind the government backed National Investment Trust (NIT).
He said that local stock markets had been under-performing for the last year or so and investments in any company were considered a risky option. “But our managers and analysts have performed well even during this period and the growth of the Funds is on the rise. Karachi Stock Market declined around 4,000 points in the last one year,” he said.
“Our efforts have been recognized in the form of a number of accolades, including the prestigious Corporate Excellence Award bestowed upon us by the Management Association of Pakistan in December 2014.”
“Our commitment to excellence is further reflected in our rating of AM2+ awarded in December 2014, signifying high management quality. This is the highest rating currently awarded to any assets manager in Pakistan,” he said, and added, “We are the recipient of two Pakistan Software House Association’s (P@SHA) ICT Awards – for Best in Service Innovation in recognition of our first-of-its-kind smartphone app: the UBL Funds Smart Savings App, and CIO of the Year 2015 awarded to our CTO, Rehan Qadri, making us the first AMC in Pakistan to win these awards. Thomson Reuter’s Lipper Awards 2015 named two of our funds winners of four categories under the Global Islamic head in recognition of the Funds’ superior performances during the period under consideration. Moreover, we have received IPO Market Development Awards 2015 in two categories, Maximum Mutual Fund IPOs and Islamic Instrument Initial Public Offerings (IPOs).”
“We are passionate about performing at the highest level, and this commitment grows stronger with every milestone that we achieve. It is our mission to provide superior investment services and make a positive and uplifting difference in the lives of our clients.”
He said that the company strove to retain and enhance its market share in Islamic Funds by delivering superior fund performance in existing funds and by introducing new funds that cater to investor needs which are yet to be fulfilled. UBL Funds has been a pioneer in Islamic CPPI-based Funds, which has promoted the culture of stock market investing in Pakistan by delivering competitive returns through investment in stocks based on an internationally-renowned strategy. He said that the introduction and performance of these funds had played an important role in strengthening and enhancing the image and market share of Islamic mutual funds throughout the industry.