Unlocking Opportunities in Islamic Asset Management: RHBIIAM Insights

On this episode of Biztech’s Investor Conversations we feature Mohd Farid Bin Kamarudin, Chief Executive Officer of RHB Islamic International Asset Management who sheds light on the company’s position in the asset management market, their unique offerings, and future strategies.

Key takeaways :

Diverse Asset Management Group:

Mohd Farid highlighted that RHB Islamic International Asset Management Berhad operates within the RHBs Banking Group, consisting of three entities: originally Asset Management Malaysia, RHB Islamic International Asset Management Malaysia, and RHB Asset Management Pte Ltd in Singapore. Together, they form a leading asset management group providing innovative financial solutions covering both conventional and Islamic asset classes in multiple countries.

Emphasis on Product Differentiation:

In a competitive landscape, RHB Asset Management focuses on product differentiation to stand out from traditional players and fintech disruptors. Mohd Farid expressed that their launch of the first Sharia-compliant global equity fund in Malaysia exemplifies their commitment to innovative product development.

Success of Sharia-Compliant Sustainable Technology Fund:

The company launched the Sharia-compliant RHB i-Global Sustainable Disruptors Fund in 2021, gaining traction despite challenging market conditions during the COVID-19 pandemic. The fund achieved a significant Assets Under Management (AUM) of around 700 million ringgit, indicating strong demand from both institutional and retail investors.

Asset Under Management (AUM) Breakdown:

RHB Asset Management’s total AUM stands at approximately 50 billion ringgit, with Islamic assets representing around 20% of the portfolio. The company sees immense potential in the Islamic sector and aims to close the gap with conventional products by expanding their offerings.

Focus on Retail Business:

Mohd Farid envisions a strong focus on the retail business segment, as it promises higher margins. However, the market backdrop and investor sentiment may impact demand, and the company remains flexible to adapt to changing dynamics, including catering to institutional and corporate demands.

Expansion in ESG and Sustainability:

RHB Asset Management aims to capitalize on the growing interest in Environmental, Social, and Governance (ESG) investments. Mohd Farid shared that they currently lead the market in Malaysia with nine ESG products, and they plan to introduce more diverse ESG product options in 2023 and 2024.

Future Growth and Talent Retention:

Mohd Farid anticipates a better market in the coming years and hopes to launch additional products to cater to growing demand. He also highlights the importance of attracting new talent to the asset management industry, recognizing the need for a sustainable and talented workforce.