The National Bank of Abu Dhabi (NBAD), the Number One Bank in the UAE, delivered 9.26% returns for its fixed income unconstrained institutional clients in 2011, despite tough conditions in financial markets.
NBAD achieved this high return by astutely investing in UAE and GCC bond markets, a selection based on internal research and investment process. The returns have been delivered in a very low risk fashion with portfolios displaying lower volatility than even 3 – 5 year US Treasuries.
2011 has been an incredibly difficult year for financial markets and investors had to studiously monitor the market to stay ahead of the game,” said Mark Watts, the Head of Fixed Income at NBAD's Asset Management Group. “2011 opened with a positive tone but things soon changed with the onset of what commentators have dubbed ‘the Arab Spring.’ During the summer, markets were further rocked by the US credit rating downgrade and the start of the debt problems in Europe, which have remained a dominant theme throughout the rest of 2011. We are pleased to have returned over 9% for our unconstrained portfolios in this environment.
NBAD’s Asset Management Group is one of the largest asset managers in the region. In 2011, Global Investor magazine, published by Euromoney, named NBAD’s Asset Management Group the UAE Best Asset Manager of the Year Award.
The Group launched the GCC’s first exchange-traded fund in 2010, the NBAD OneShare Dow Jones UAE 25 ETF, which was named the Best Investment Product in the prestigious Banker Middle East Products Award 2011 by Banker Middle East magazine.
NBAD’s Asset Management Group has greatly enhanced the diversity of financial products in the UAE market by introducing a number of innovative financial products that expanded investors’ options especially in realm of fixed income.
Recently, AMG launched 100% capital-protected commodity basket investment, a highly innovative product that allows investment in five commodities and offers investors the potential for attractive returns. The NBAD 100% Capital protected 5-in-1 Commodity basket investment offers investors the unique opportunity to capture upside in the highly exciting commodity markets without exposing themselves to downside risk if held to maturity.
Looking forward to 2012, Mr. Watts believes that Europe will remain a key focus for markets and the onus is on EU governments to agree on sufficient measures to remove the risk of a Euro break up.
“Europe is set to enter into a recession in the coming months and this is not a positive backdrop for global growth. There are some positive signs from the US to balance this but with China decelerating, the outlook for financial markets remains finely balanced. We are forecasting decent returns in 2012 from regional bond markets, which will remain partially insulated from global events and will benefit from oil prices that remain above fiscal breakeven.”
Alan Durrant, NBAD's Group Chief Investment Officer and General Manager of Asset Management Group, said the robust returns the Group achieved reflects the quality of resources it can utilise.
“I am proud of the results my team of highly skilled professionals has accomplished. The Group’s investment strategy is backed by the most sophisticated and capable research capabilities,” Mr. Durrant said.