MBC-backed Al Arabia profit jumps 63% on stronger customer base

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Total assets of Saudi investment funds fell by SR23.2 billion ($6.2 billion) in the second quarter of 2022, according to data from the Central Bank of Saudi Arabia, also known as SAMA.

The drop marked the biggest fall the Kingdom has seen since the second quarter of 2006, when the decline in total fund assets amounted to SR30 billion.

While the slowdown in 2006 was primarily due to the SR28.8 billion decline in the country’s domestic stocks, this year’s fall was due to a more general decline in a range of asset types.

Foreign money market instruments saw the largest drop of SR 8.7 billion in the second quarter of this year.

Domestic stocks and other domestic assets decreased by SR6.4 billion and SR4.5 billion respectively in the second quarter.

In addition, domestic money market instruments and domestic sukuk and bonds fell by SR 4.1 billion and SR 1.3 billion respectively, according to SAMA data.

Investment fund assets have been on a downward trend since the third quarter of 2021.

Total assets fell by 1% from SR 1.8 billion in the third quarter of 2021, reaching SR 240 billion.

Total assets fell 5% in the fourth quarter of 2021 to SR227 billion, and another 5% in the first quarter of 2022 to SR216 billion quarter-on-quarter, according to SAMA data.

The latest data showed a staggering drop of 11% in the second quarter of this year, totaling SR 193 billion. The Kingdom’s investment funds in the second quarter included SR143 billion in domestic assets and SR50 billion in foreign assets, the data showed.

Domestic assets have fallen twice in the past year; they fell by SR 7.7 billion in the fourth quarter of 2021, then by SR 15.4 billion a year later.

However, these assets saw a jump of SR 10.4 billion in the previous quarter of this year, as well as a moderate increase of SR 138 million in the third quarter of 2021.

Foreign assets have declined over the past four quarters; they fell by SR 2.0 billion, SR 5.0 billion, SR 21.9 billion and SR 7.7 billion in each quarter during this period, the data showed.

QUICKFACTS

While the slowdown in 2006 was primarily due to the SR28.8 billion decline in the country’s domestic stocks, this year’s fall was due to a more general decline in a range of asset types.

Foreign money market instruments saw the biggest drop of SR 8.7 billion in the second quarter of this year. Domestic stocks and other domestic assets decreased by SR 6.4 billion and SR 4.5 billion respectively in the second quarter.

At the end of the second quarter of this year, there were 254 operating funds and about 666,000 subscribers for the country’s investment fund.

The number of open-ended investment fund assets in the second quarter was SR 160 billion, down SR 25 billion from the previous quarter.

Closed assets, on the other hand, recorded an increase of SR 1.9 billion during this quarter, reaching a total of SR 32.7 billion. Domestic money market instruments held the largest share of total investment fund assets, accounting for 34% of the total.

Foreign money market instruments rank second with 22% of total assets, while other foreign assets rank third with 15%.

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