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GCC asset managers expect more inflows amid growing ESG, Islamic investments – Moody’s

GCC asset managers expect more inflows amid growing ESG, Islamic investments – Moody’s
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Mubasher: The asset management segment across the Gulf region is expected to witness increased inflows over the coming 12 months in line with the growing demand for Islamic and environmental, social, and governance (ESG)-compliant investments, Moody's said on Monday.

About 50% of the respondents to a Moody’s survey predicted to see a double-digit growth in net inflows, while 33% expected a high single-digit increase.

"Improved investment results and stronger fees, already comparatively high in the GCC region, will further support revenue growth," VP-Senior Credit Officer at Moody's, Vanessa Robert, said.

The 2021 survey of chief investment officers (CIOs), which covered eight leading GCC fund firms, found that 38% of respondents foresaw a significant growth in demand for ESG-compliant investment products.

Meanwhile, 50% of respondents expected sales of Islamic products to surge more rapidly than sales of conventional investments in 2022.

Also about 50% of respondents said they were open to merger and acquisition (M&A) activity over the coming two years.

“Respondents' optimism was tempered by worries over geopolitical tensions, the economic impact of the pandemic, and volatile oil prices,” according to Moody’s.