A 2015 report by The World Bank revealed that the Islamic finance industry has seen massive growth over the last decade, with its expansion happening at a growth rate of 10-12% annually- indeed, Sharia-compliant financial assets were valued at roughly US$2 trillion in 2015. Industry insiders also believe that Islamic financing has the potential to bride the gap in the funding of micro, small and medium enterprises (SMEs), and that its asset-backed and risk-sharing traits help promote entrepreneurship.
It is in this financial landscape that KBW Investments (KBW) has launched Crestmount Capital, an Islamic finance-focused investment firm that will deploy its funds exclusively in Sharia-compliant investments. In addition to the launch of the enterprise, KBW also announced that Crestmount Capital’s maiden Crestmount Fund I, a Sharia-compliant real estate investment fund, has managed to close subscription of its entire commitment worth AED267 million.
The Fund, with the guidance of Amanie Advisors, plans to deploy the said amount into five separate Australian Sharia-compliant projects at a local market value of AUD100 million. These include residential development projects developed by Australia’s PietyTHP Developments, a Sharia-compliant developer. According to a statement on the launch, KBW expects the fund to generate a high “risk-adjusted return” for its subscribers as the specified projects are already under development.
Commenting on the launch, KBW Chairman HRH Prince Khaled bin Alwaleed bin Talal said in a statement: “Crestmount Capital is KBW’s flagship entry into the Islamic finance segment. Having explored a variety of investment vehicles and types, the company’s interest has now increasingly turned to activating our existing strengths in finance to work for the advantage of the sophisticated Islamic investor.” While an in-house team will manage Crestmount Capital’s investments portfolio, the funds will be deployed with the guidance of an external Sharia Supervisory Board comprised of Islamic finance industry experts.