GIB Capital offers GIB Murabaha Fund units

Logo of GIB Capital

GIB Capital offered the units of the Shariah-compliant GIB Murabaha Fund, an open-ended money market fund with a low-ticket size, on Jan. 26, 2023.

The offering period is 45 days.

The fund will be active upon raising the minimum subscription limit amounting to SAR 5 million before the offering completion. However, if undersubscribed, the offering period may be extended for 15 business days after obtaining the Capital Market Authority's (CMA) approval.

The fund will be active on March 29, 2023, with a minimum subscription of nearly SAR 100 million for class A and SAR 5,000 for class B.

Qualified and institutional investors, retail clients from the public or private sectors, either local or foreign investors, natural or legal persons, are eligible to subscribe to the offering.

The SAR-denominated fund aims to generate return on low-risk investments via investing in Murabaha and sukuk deposits, in cooperation with globally and locally renowned financial institutions and in line with Shariah.

The fund aims to maintain high-liquidity level, which will enable investors to retain investments in a short span. The fund, as per the prospectus, is considered an ideal tool to manage cash.

The fund's investments in Murabaha represent 70% minimum of its net asset value. This is carried out through cooperation with local and regional financial institutions that have a strong financial position.

 The fund manager has the right to invest up to 30% maximum of the net asset value in sukuk. The focus will be placed on the sukuk issued in Saudi Arabia, and the fund manager can invest in the sukuk issued by government agencies and companies outside the Kingdom (GCC).

Further, the fund manager can invest up to 10% of the fund's net asset value in the funds that invest in low-risk Murabaha transactions, provided that they are compatible with the fund's Shariah standards, licensed by the CMA and offered for public in Saudi Arabia by the fund manager or any other manager or both.

In January, the CMA issued a resolution approving GIB Capital Co.’s initial public offering (IPO), according to data available with Argaam.