Investor Monthly Newsletter
For the Month Ending 31st March 2013
Inside this issue: UAE Central Bank agreed on mortgage caps
Topic of the month – GCC Banking Sector Outlook
The UAE markets took a breather after a strong start to the year
TNI MENA UCITS increased by 1.1% in March
TNI MENA Special Sits increased its fixed income duration
IMPORTANT NOTICE
THIS “INVESTOR MONTHLY NEWSLETTER” IS CONFIDENTIAL TO THE ADDRESSEE AND SHOULD NOT BE DISCLOSED NOR DISTRIBUTED TO ANY THIRD PARTY WITHOUT THE PRIOR CONSENT OF THE NATIONAL INVESTOR (HEREINAFTER REFERRED TO AS “TNI”)
THIS NEWSLETTER IS FOR INFORMATION AND DOES NOT CONSTITUTE A PROSPECTUS OR OFFERING CIRCULAR OR AN OFFER OR INVITATION TO SUBSCRIBE FOR UNITS OR SHARES IN ANY OF TNI FUNDS. ALL TNI FUNDS (THE “FUNDS”) ARE AVAILABLE FOR SUBSCRIPTION ONLY ON THE BASIS OF THE RELEVANT PRIVATE PLACEMENT MEMORANDUM, SUBSCRIPTION AGREEMENT AND APPLICATION FORM WHICH ARE AVAILABLE ONLY TO INVESTORS THAT SATISFY THE APPLICABLE ELIGIBILITY CRITERIA FOR INVESTMENT.
TNI FUNDS INCLUDED IN THIS NEWSLETTER ARE UNREGULATED FUNDS FOR THE PURPOSES OF THE UNITED KINGDOM FINANCIAL SERVICES AND MARKETS ACT 2000 (“FSMA”), THE PROMOTION OF WHICH IN THE UNITED KINGDOM IS RESTRICTED BY SECTIONS 21 AND 238 OF FSMA. ACCORDINGLY, NO TNI FUNDS’ SHARES OR UNITS MAY BE OFFERED OR SOLD IN THE UK OTHER THAN (I) BY A PERSON AUTHORIZED BY THE UK FINANCIAL SERVICES AUTHORITY (THE “FSA”) (AN “AUTHORIZED PERSON”) IN ACCORDANCE WITH THE FINANCIAL SERVICES AND MARKETS ACT 2000 (PROMOTION OF COLLECTIVE INVESTMENT SCHEMES - EXEMPTIONS) ORDER 2001 OR THE FSA CONDUCT OF BUSINESS RULES; OR (II) BY A PERSON OTHER THAN AN AUTHORIZED PERSON IN ACCORDANCE WITH THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005. THE FUNDS ARE NOT REGULATED BY THE FSA AND INVESTORS WILL NOT HAVE THE BENEFIT OF THE FSA FINANCIAL SERVICES COMPENSATION SCHEME AND OTHER PROTECTIONS AFFORDED BY FSMA OR ITS RULES AND REGULATIONS.
8.1%
8.8%
8.9%
8.9%
9.5%
0.0% 2.0% 4.0% 6.0% 8.0% 10.0%
ENBD
NBAD
Emaar
FGB
Etisalat
`
48.2%
33.5%
7.8%
10.5%
Abu Dhabi
Dubai
DIFX
Cash
TNI UAE BLUE CHIP FUNDFact Sheet as of June 30, 2011
Fund Profile
Focus: Although the fund may participate in markets throughout the Gulf Cooperative
Countries (‘GCC’), its investments will be primarily focused on publicly traded equities of UAE
firms with large capitalization, which present a steady and recurrent track record of earnings
growth and have a potential for capital appreciation.
Management Style: The key investment criteria are the company’s financial strengths,
competitiveness, profitability, growth prospects and quality of management. The allocation
will be based on fundamental research and will incorporate a blend of top-down and a
bottom-up analytical approach.
Objective: The fund aims to provide long-term capital appreciation through investing in
equity securities publicly traded, primarily in the UAE, and, to a lesser extent, in other GCC
markets.
Suitability: Units of the Fund are speculative and involve a high degree of risk. The Fund is
therefore designed for sophisticated investors who are able to understand the risks involved
in emerging markets’ equity investments, particularly in the GCC equities.
Asset Allocation Top Holdings
Fund Performance since Inception
Fund Performance (%)
Monthly PerformanceWTD -0.9
MTD 0.9
YTD -1.3
Since Inception -61.3
Value Blend GrowthLarge
Medium
Small
Fund Profile
WTD -0.9
MTD 0.5
YTD -0.8
Since Inception -49.8
Fund Facts
Index comparison is used for illustrative purposes only.
% Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec YTD
2005 - - - - 2.7 6.9 -11.2 6.0 5.9 4.3 1.3 -4.1 12.2
2006 -5.4 -4.7 -3.4 -8.5 -5.7 -2.9 -2.4 5.2 2.2 -3.4 -8.4 0.3 -32.9
2007 -0.8 2.5 -5.1 3.7 18.8 -1.7 0.0 -3.8 1.6 18.9 4.4 9.1 54.9
2008 -3.7 7.2 -6.1 9.8 -0.5 -1.8 0.8 -15.0 -15.7 -22.4 -23.2 -12.1 -60.7
2009 -9.7 4.9 8.7 5.8 9.3 -1.8 5.0 4.2 13.2 -2.9 -4.8 -13.1 16.2
2010 -8.3 -3.4 16.7 -1.7 -9.1 -2.9 -1.8 -1.9 10.5 5.0 -4.0 -1.4 -5.1
2011 -0.9 -7.9 6.4 7.0 -5.1 0.5 -0.8
Inception Date May 01, 2005
Base Currency AED
Dealing Currencies AED - USD
Minimum Inv. AED 350,000
NAV / Unit AED 5.02
Net Assets AED 127.40m
Initial Fee 3% (max.)
Management Fee 1.5%
Custody/Admin Fee 0.45% (max.)
Performance Fee 10% subject to High Watermark
Hurdle Rate EIBOR (3M)
Redemption Fee 1% after 1 Year
NAV Weekly (No Lock-up)
Custodian Deutsche Bank
Administrator Deutsche Bank
Auditors KPMG
Lawyers Tamimi & Co
Fund Manager TNI
Domicile UAE
ListingDubai Financial Market –TNIUAEBCF
Reuters Lp65037579
Bloomberg TNIUAEF UH Since Inception %
TNI UAE Blue Chip Fund -49.8
S&P UAE Dom Capped -61.3
MSCI UAE Index -69.3
S&P UAE Dom Capped Index (%)
The National Investor
Headquarters
TNI Tower | Zayed 1st Street Khalidiya|
P.O. Box 47435 | Abu Dhabi | UAE
Phone: +971 2 619 2300
Fax: +971 2 619 2400
Email: [email protected]
www.tni.ae
0%
20%
40%
60%
80%
100%
120%
140%
160%
Apr-05 Apr-06 Apr-07 Apr-08 Apr-09 Apr-10 Apr-11
TNI BCF
MSCI UAE Index
S&P UAE Dom Capped Index
TNI ASSET MANAGEMENT Team Members Fund Management Walid Hayeck Managing Director +971 2 619 2321 [email protected] Sebastien Henin Senior Vice President +971 2 619 2337 [email protected] Ali Adou Senior Vice President +971 2 619 2327 [email protected]
Analyst +971 2 619 2322
Divye Arora
Business Development Kashif Zia Managing Director +971 2 619 2305 [email protected] Sani Tsuruta Senior Vice President +971 2 619 2356 [email protected]
Risk Management and Middle Office Imran Ladhani Senior Manager +971 2 619 2334 [email protected] Malik Al Zyadat Senior Manager +971 2 619 2425 [email protected] Ahmed Bakir Analyst +9712 619 2329 [email protected]
Legal & Compliance Ajith Mathew Senior Vice President, Compliance +971 2 619 2366 [email protected] Reine El Asfar Senior Associate, Legal +971 2 619 2318 [email protected]
Custody & Administration Deutsche Bank Mike Cowley +971 4 361 1700 [email protected]
Peter Hughes +144 1 292 2793
Apex Fund Services
[email protected] HSBC Fund Services Glyn D Gibbs +971 4 4236138 [email protected] Citibank John Dwyer +9714 604 4450 [email protected] Auditors Deloitte & Touche Gunshyam Kripa +971 2 408 2448 [email protected] Deloitte & Touche Alan Cuddihy +353 21 420 7824 [email protected]
0%
20%
40%
60%
80%
100%
120%
Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13
S&P Pan Arab CompositeLarge/MidCap Index
S&P GCC CompositePrice Index
PERFORMANCE REVIEW March 2013
Market Performance
March witnessed a quiet month in terms of volatility and liquidity. The S&P Pan Arab Composite remained flat during the period. The Saudi market, the biggest and most liquid one in the region slightly outperformed the index; the market gained 2.2%. The Egyptian market has been penalized amid the recent political events; the market lost 4.1% during the period. UAE markets took a breather after a very strong rally during the first two months of 2013. Year-to-date UAE is up 17.1%. Price of oil has lost some ground; the Brent quality closed the period at US$ 110.02 per bbl, down 1.2% over the period.
Manager’s Comments
TNI UAE Blue Chip Fund
The UAE markets took a breather in March as retail investors booked profits after a very strong start to the year. Valuations overall are still attractive backed by very strong economic macro picture, which makes the UAE one of the most attractive markets in the region. During March, the Fund Manager increased the cash allocation to 5.1% and maintained exposure to other GCC markets to 2.6%. TNI UAE Blue Chip Fund is up 19.4% year-to-date.
TNI MENA Special Situations Fund
The Fund increased by 1.1% in March. On the fixed income side we increased the portfolio’s duration and we added two names, the new DIB perpetual issue and the Iraqi Eurobond 28. We made some arbitrages on the equity side. We booked our profits in the UAE and we took some positions in Saudi Arabia.
S&P Pan Arab Composite- S&P GCC Composite Index
MENA UCITS Fund
TNI MENA UCITS Fund was up 1.1% in March, outperforming its benchmark S&P Pan Arab 5/10/40 Capped Index by 1.2%. The outperformance was driven by Industrial and Banking sectors. During the month of March, the Fund Manager reduced the cash position to 3.5%. On a country level, Saudi continued to be the most prefered country. The least preferred counties remained Kuwait and Bahrain.
Regional Performance
Other MENA Indices MTD% YTD%
Egypt -4.1 -6.2
Morocco 2.4 -2.2
Tunisia 2.8 4.2
Jordan -2.1 2.1
Lebanon -1.7 1.2
S&P GCC Indices MTD% YTD%
Saudi Arabia 2.2 0.9
UAE -1.2 17.1
Kuwait -1.3 1.1
Qatar 1.3 3.4
Oman 1.9 5.2
Bahrain -1.9 8.8
MTD performance is measured from 28th February 2013 to 28th March 2013
0.6
0.7
0.8
0.9
1.0
1.1
1.2
1.3
Apr-0
6
Dec-
06
Aug-
07
Apr-0
8
Dec-
08
Aug-
09
Apr-1
0
Dec-
10
Aug-
11
Apr-1
2
Dec-
12
200
250
300
350
400
450
Apr-12 Jun-12 Aug-12 Oct-12 Dec-12 Feb-13
MARKETS REVIEW
March 2013
The MENA Equity Markets The UAE Central Bank gave its initial approval to a proposal by banks to allow a loan-to-value ratio of 75% for expatriates and 80% for citizens for their first property. Loan-to-value ratio for second properties would be 60% for expatriates and 65% for citizens. Passenger traffic at Dubai's main airport surpassed 5 million in February, rising 11.4% YoY. Year-to-date traffic was up 13.0% to 10.6 million passengers.
Qatar is pressing ahead with its massive transport infrastructure programmes, with US$ 17billion worth of projects still to be offered. Qatar's Public Works Authority has lined up 30 highway projects in 2013. As of February, a total of US$ 1.88billion worth of projects have already been awarded.
The Kuwait government is taking necessary steps to reduce the number of expatriates in Kuwait by 100,000 every year. The country is looking to bring down the number of expatriates in Kuwait to 1 million in 10 years from about 2.6 million. Currently expats cosntitutes about 68% of the total population. Kuwait is taking these steps as part of effort to regulate the labor market.
Egypt's foreign currency reserves did not decline significantly in March from US$ 13.5billion at end of February. However, the current reserves are not enough to cover even three months of imports. The country is plagued by repeated power cuts as it does not have money to buy enough fuel. Egypt is also seeking payment facilities from American and European wheat suppliers.
UAE banks are taking advantage of falling CDS spreads and increasing liquidity to raise money through Sukuks and bonds for repaying the government debt which they received to enhance balance sheet liquidity in the aftermath of financial crisis. Emirates NBD priced a US$ 750million subordinated bond at 4.88%, tighter than initial guidance. Dubai Islamic Bank issued US$ 1billion Tier 1 hybrid perpeptual Sukuk at a profit rate of 6.25% which was substantially tighter than the initial price talk of 7%.
Chart 1: Dubai government 5 Year CDS spread
Chart 2: Relative MENA PE to MSCI World
Source: Bloomberg
Source: Bloomberg
0.0%
9.0%
18.0%
27.0%
36.0%
45.0%
Jan-12 Mar-12 May-12 Jul-12 Sep-12 Nov-12
Saudi UAE Qatar Kuwait Oman
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Mar-13
Saudi UAE Qatar Kuwait Oman Bahrain
13.8%
16.3% 17.3%18.8%
21.6%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
Oman Kuwait Saudi Qatar UAE
1.4%
2.2%
3.1%
6.5%
5.7%
1.4%1.8%
2.9%
5.5%
6.7%
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
Qatar Saudi Oman Kuwait UAE
TOPIC OF THE MONTH March 2013
GCC Banking Sector Outlook The gradual re-acceleration of economic activity in US, China and other emerging markets is positive for the oil demand and would help oil exporting GCC countries to maintain their fiscal surpluses and strong GDP growth, and keep up with increasing infrastructure spending. Based on IMF data we estimate region’s GDP to grow annually at average 4% during 2013-2015 compared to global GDP growth of 3.4% during the same period. Infrastructure and construction project pipeline across GCC stands at US$ 581billion, up 18% over the last six months, based on Meed projects database, with Saudi being the top project market accounting for 39.6% of the total pipeline. This growing project pipeline will create increasing credit and project financing demand from both corporate and government entities. In 2013, while banks in Qatar, Saudi and Oman would continue to benefit from strong government spending, Kuwait and UAE banks would witness decreasing incremental non-performing loan (NPL) formation after facing significant asset quality issues and managing their balance sheets over the last four years.
Saudi banking index year-to-date is up only 2.9% and has underperformed Tadawul index by 2.4% as investor sentiment turned cautious on the banks post spike in provisioning costs during 3Q2012 tied to financial difficulties at a few major corporate houses. Increasing competition also caused sector net interest margins (NIMs) to contract by 16bps in 2012. Although we expect NIMs to remain under pressure, earning would still witness a moderate growth as provisioning costs should normalize on account of overall corporate profitability remaining healthy, and loan growth momentum would continue owing to accelerating corporate loan growth and retail lending remaining strong. Asset quality indicators continue to improve with incremental NPL formation slowing after a spike in 2009, and average NPL coverage reaching to a comfortable level of 145% for the sector. Valuations are at undemanding level after a strong de-rating as Saudi banks currently trade at lowest trailing PB of 1.8x over the last eight years. Saudi banks valuation premium to GCC banks has also contracted significantly to 12% compared to last eight-year median of 30%
Most of the UAE banks distributed solid cash dividends during 2012 with average payout ratio of about 50%, and dividend yield of above 6%. A greater willingness to distribute profits signals towards declining asset quality concerns and banks reaching closer to the desired provisioning levels. UAE banks are the best capitalised in the region with average capital adequacy ratio (CAR) of 21.5%. Loan growth in UAE would remain well below most of the other GCC countries. However, we expect Dubai banks to witness a better loan growth than Abu Dhabi banks in 2013 owing to a strong recovery in Dubai economy and real estate sector. Dubai banks would also benefit from normalisation in provisioning costs. Although Abu Dhabi has earmarked US$ 90billion to be spent on development projects over the next five years, we expect Abu Dhabi banks to benefit from this spending mainly from next year.
Qatar banking sector is witnessing the highest loan growth (26% YoY in 2012) in the region mainly driven by significant public sector spending on infrastructure, but persistent pressure on NIMs and fees poses a challenge. We expect QNB to continue to benefit from this strong loan growth as its loan book is highly levered to the public sector and it has the excess capital (expected CAR of 16.5% post NSGB acquisition) and adequate capital generation capacity to sustain such a lending growth. Doha Bank and CBQ are looking to raise further capital which would be ROE and EPS dilutive in the near term. They will benefit from pickup in private sector loan demand linked mainly to FIFA World Cup projects. However, we expect this project activity to gain momentum only in 2014.
Kuwait banking sector loan growth remained subdued in 2012, up 5% YoY mainly driven by retail loan growth of 12%, due to a lack of investment activity as hardly any of the projects included in US$ 107billion investment program materialised. The newly elected more pro-government parliament might expedite government spending, however, it will be overly optimistic to expect a double digit lending growth in 2013 due to the poor project implementation track record and bureaucracy issues. Blue chip names such as NBK could benefit from some pickup in the corporate demand, decline in NPL formation and stimulation of the market from government equity funds. Burgan Bank offers the strongest loan growth momentum supported by its Turkish subsidiary, expanding domestic market share and liquidity inflow from its captive client base (KIPCO Group subsidiaries)
Loan growth outlook for Oman banking sector remains optimistic driven by corporate demand and government infrastructure spending. However, loan growth would be lower than 2012 (14.4% YoY) as some of the banks will see constrained growth due to new retail regulations capping personal lending to 50% of total loans and reducing interest rate ceiling to 7% per annum. Bank Muscat is relatively comfortable in this respect, with 56% of its loan book being geared to the corporate sector. Conventional banks also run a risk of market share erosion and margin compression due to the expected competition from two newly launched Islamic banks.
Chart 1: YoY loan growth
Source: Respective central bank data
Chart 2: Trailing PB
Source: Bloomberg
Chart 3: Capital adequacy ratio
Source: Respective bank’s financials
Chart 4: NPL ratio (2011-12)
Source: Respective bank’s financials
0.0%
9.0%
18.0%
27.0%
36.0%
45.0%
Jan-12 Mar-12 May-12 Jul-12 Sep-12 Nov-12
Saudi UAE Qatar Kuwait Oman
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Mar-13
Saudi UAE Qatar Kuwait Oman Bahrain
13.8%
16.3% 17.3%18.8%
21.6%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
Oman Kuwait Saudi Qatar UAE
1.4%
2.2%
3.1%
6.5%
5.7%
1.4%1.8%
2.9%
5.5%
6.7%
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
Qatar Saudi Oman Kuwait UAE
TOPIC OF THE MONTH March 2013
GCC Banking Sector Outlook The gradual re-acceleration of economic activity in US, China and other emerging markets is positive for the oil demand and would help oil exporting GCC countries to maintain their fiscal surpluses and strong GDP growth, and keep up with increasing infrastructure spending. Based on IMF data we estimate region’s GDP to grow annually at average 4% during 2013-2015 compared to global GDP growth of 3.4% during the same period. Infrastructure and construction project pipeline across GCC stands at US$ 581billion, up 18% over the last six months, based on Meed projects database, with Saudi being the top project market accounting for 39.6% of the total pipeline. This growing project pipeline will create increasing credit and project financing demand from both corporate and government entities. In 2013, while banks in Qatar, Saudi and Oman would continue to benefit from strong government spending, Kuwait and UAE banks would witness decreasing incremental non-performing loan (NPL) formation after facing significant asset quality issues and managing their balance sheets over the last four years.
Saudi banking index year-to-date is up only 2.9% and has underperformed Tadawul index by 2.4% as investor sentiment turned cautious on the banks post spike in provisioning costs during 3Q2012 tied to financial difficulties at a few major corporate houses. Increasing competition also caused sector net interest margins (NIMs) to contract by 16bps in 2012. Although we expect NIMs to remain under pressure, earning would still witness a moderate growth as provisioning costs should normalize on account of overall corporate profitability remaining healthy, and loan growth momentum would continue owing to accelerating corporate loan growth and retail lending remaining strong. Asset quality indicators continue to improve with incremental NPL formation slowing after a spike in 2009, and average NPL coverage reaching to a comfortable level of 145% for the sector. Valuations are at undemanding level after a strong de-rating as Saudi banks currently trade at lowest trailing PB of 1.8x over the last eight years. Saudi banks valuation premium to GCC banks has also contracted significantly to 12% compared to last eight-year median of 30%
Most of the UAE banks distributed solid cash dividends during 2012 with average payout ratio of about 50%, and dividend yield of above 6%. A greater willingness to distribute profits signals towards declining asset quality concerns and banks reaching closer to the desired provisioning levels. UAE banks are the best capitalised in the region with average capital adequacy ratio (CAR) of 21.5%. Loan growth in UAE would remain well below most of the other GCC countries. However, we expect Dubai banks to witness a better loan growth than Abu Dhabi banks in 2013 owing to a strong recovery in Dubai economy and real estate sector. Dubai banks would also benefit from normalisation in provisioning costs. Although Abu Dhabi has earmarked US$ 90billion to be spent on development projects over the next five years, we expect Abu Dhabi banks to benefit from this spending mainly from next year.
Qatar banking sector is witnessing the highest loan growth (26% YoY in 2012) in the region mainly driven by significant public sector spending on infrastructure, but persistent pressure on NIMs and fees poses a challenge. We expect QNB to continue to benefit from this strong loan growth as its loan book is highly levered to the public sector and it has the excess capital (expected CAR of 16.5% post NSGB acquisition) and adequate capital generation capacity to sustain such a lending growth. Doha Bank and CBQ are looking to raise further capital which would be ROE and EPS dilutive in the near term. They will benefit from pickup in private sector loan demand linked mainly to FIFA World Cup projects. However, we expect this project activity to gain momentum only in 2014.
Kuwait banking sector loan growth remained subdued in 2012, up 5% YoY mainly driven by retail loan growth of 12%, due to a lack of investment activity as hardly any of the projects included in US$ 107billion investment program materialised. The newly elected more pro-government parliament might expedite government spending, however, it will be overly optimistic to expect a double digit lending growth in 2013 due to the poor project implementation track record and bureaucracy issues. Blue chip names such as NBK could benefit from some pickup in the corporate demand, decline in NPL formation and stimulation of the market from government equity funds. Burgan Bank offers the strongest loan growth momentum supported by its Turkish subsidiary, expanding domestic market share and liquidity inflow from its captive client base (KIPCO Group subsidiaries)
Loan growth outlook for Oman banking sector remains optimistic driven by corporate demand and government infrastructure spending. However, loan growth would be lower than 2012 (14.4% YoY) as some of the banks will see constrained growth due to new retail regulations capping personal lending to 50% of total loans and reducing interest rate ceiling to 7% per annum. Bank Muscat is relatively comfortable in this respect, with 56% of its loan book being geared to the corporate sector. Conventional banks also run a risk of market share erosion and margin compression due to the expected competition from two newly launched Islamic banks.
Chart 1: YoY loan growth
Source: Respective central bank data
Chart 2: Trailing PB
Source: Bloomberg
Chart 3: Capital adequacy ratio
Source: Respective bank’s financials
Chart 4: NPL ratio (2011-12)
Source: Respective bank’s financials
0.0%
9.0%
18.0%
27.0%
36.0%
45.0%
Jan-12 Mar-12 May-12 Jul-12 Sep-12 Nov-12
Saudi UAE Qatar Kuwait Oman
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Mar-13
Saudi UAE Qatar Kuwait Oman Bahrain
13.8%
16.3% 17.3%18.8%
21.6%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
Oman Kuwait Saudi Qatar UAE
1.4%
2.2%
3.1%
6.5%
5.7%
1.4%1.8%
2.9%
5.5%
6.7%
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
Qatar Saudi Oman Kuwait UAE
TOPIC OF THE MONTH March 2013
GCC Banking Sector Outlook The gradual re-acceleration of economic activity in US, China and other emerging markets is positive for the oil demand and would help oil exporting GCC countries to maintain their fiscal surpluses and strong GDP growth, and keep up with increasing infrastructure spending. Based on IMF data we estimate region’s GDP to grow annually at average 4% during 2013-2015 compared to global GDP growth of 3.4% during the same period. Infrastructure and construction project pipeline across GCC stands at US$ 581billion, up 18% over the last six months, based on Meed projects database, with Saudi being the top project market accounting for 39.6% of the total pipeline. This growing project pipeline will create increasing credit and project financing demand from both corporate and government entities. In 2013, while banks in Qatar, Saudi and Oman would continue to benefit from strong government spending, Kuwait and UAE banks would witness decreasing incremental non-performing loan (NPL) formation after facing significant asset quality issues and managing their balance sheets over the last four years.
Saudi banking index year-to-date is up only 2.9% and has underperformed Tadawul index by 2.4% as investor sentiment turned cautious on the banks post spike in provisioning costs during 3Q2012 tied to financial difficulties at a few major corporate houses. Increasing competition also caused sector net interest margins (NIMs) to contract by 16bps in 2012. Although we expect NIMs to remain under pressure, earning would still witness a moderate growth as provisioning costs should normalize on account of overall corporate profitability remaining healthy, and loan growth momentum would continue owing to accelerating corporate loan growth and retail lending remaining strong. Asset quality indicators continue to improve with incremental NPL formation slowing after a spike in 2009, and average NPL coverage reaching to a comfortable level of 145% for the sector. Valuations are at undemanding level after a strong de-rating as Saudi banks currently trade at lowest trailing PB of 1.8x over the last eight years. Saudi banks valuation premium to GCC banks has also contracted significantly to 12% compared to last eight-year median of 30%
Most of the UAE banks distributed solid cash dividends during 2012 with average payout ratio of about 50%, and dividend yield of above 6%. A greater willingness to distribute profits signals towards declining asset quality concerns and banks reaching closer to the desired provisioning levels. UAE banks are the best capitalised in the region with average capital adequacy ratio (CAR) of 21.5%. Loan growth in UAE would remain well below most of the other GCC countries. However, we expect Dubai banks to witness a better loan growth than Abu Dhabi banks in 2013 owing to a strong recovery in Dubai economy and real estate sector. Dubai banks would also benefit from normalisation in provisioning costs. Although Abu Dhabi has earmarked US$ 90billion to be spent on development projects over the next five years, we expect Abu Dhabi banks to benefit from this spending mainly from next year.
Qatar banking sector is witnessing the highest loan growth (26% YoY in 2012) in the region mainly driven by significant public sector spending on infrastructure, but persistent pressure on NIMs and fees poses a challenge. We expect QNB to continue to benefit from this strong loan growth as its loan book is highly levered to the public sector and it has the excess capital (expected CAR of 16.5% post NSGB acquisition) and adequate capital generation capacity to sustain such a lending growth. Doha Bank and CBQ are looking to raise further capital which would be ROE and EPS dilutive in the near term. They will benefit from pickup in private sector loan demand linked mainly to FIFA World Cup projects. However, we expect this project activity to gain momentum only in 2014.
Kuwait banking sector loan growth remained subdued in 2012, up 5% YoY mainly driven by retail loan growth of 12%, due to a lack of investment activity as hardly any of the projects included in US$ 107billion investment program materialised. The newly elected more pro-government parliament might expedite government spending, however, it will be overly optimistic to expect a double digit lending growth in 2013 due to the poor project implementation track record and bureaucracy issues. Blue chip names such as NBK could benefit from some pickup in the corporate demand, decline in NPL formation and stimulation of the market from government equity funds. Burgan Bank offers the strongest loan growth momentum supported by its Turkish subsidiary, expanding domestic market share and liquidity inflow from its captive client base (KIPCO Group subsidiaries)
Loan growth outlook for Oman banking sector remains optimistic driven by corporate demand and government infrastructure spending. However, loan growth would be lower than 2012 (14.4% YoY) as some of the banks will see constrained growth due to new retail regulations capping personal lending to 50% of total loans and reducing interest rate ceiling to 7% per annum. Bank Muscat is relatively comfortable in this respect, with 56% of its loan book being geared to the corporate sector. Conventional banks also run a risk of market share erosion and margin compression due to the expected competition from two newly launched Islamic banks.
Chart 1: YoY loan growth
Source: Respective central bank data
Chart 2: Trailing PB
Source: Bloomberg
Chart 3: Capital adequacy ratio
Source: Respective bank’s financials
Chart 4: NPL ratio (2011-12)
Source: Respective bank’s financials
Monthly Performance
%
Jan
Feb
Mar
Apr
May
June
July
Aug
Sept
Oct
Nov
Dec
YTD
2005 - - - - 2.7 6.9 -11.2 6.0 5.9 4.3 1.3 -4.1 12.2
2006 -5.4 -4.7 -3.4 -8.5 -5.7 -2.9 -2.4 5.2 2.2 -3.4 -8.4 0.3 -32.9
2007 -0.8 2.5 -5.1 3.7 18.8 -1.7 0.0 -3.8 1.6 18.9 4.4 9.1 54.9
2008 -3.7 7.2 -6.1 9.8 -0.5 -1.8 0.8 -15.0 -15.7 -22.4 -23.2 -12.1 -60.7
2009 -9.7 4.9 8.7 5.8 9.3 -1.8 5.0 4.2 13.2 -2.9 -4.8 -13.1 16.2
2010 -8.3 -3.4 16.7 -1.7 -9.1 -2.9 -1.8 -1.9 10.5 5.0 -4.0 -1.4 -5.1
2011 -0.9 -7.9 6.4 7.0 -5.1 0.5 -1.2 -2.3 -4.9 -2.4 -3.0 -0.8 -14.5
2012 1.6 9.7 3.1 -0.3 -5.7 -0.6 2.2 4.2 14.3
7.5%
8.7%
8.8%
9.0%
9.0%
0.0% 2.0% 4.0% 6.0% 8.0% 10.0%
ENBD
NBAD
Emaar
FGB
Etisalat
`
51.9%
36.3%
6.5%3.3%
2.0%
Abu Dhabi
Dubai
Nasdaq DubaiCash
GCC
0%
20%
40%
60%
80%
100%
120%
140%
160%
Apr-05 Nov-05 Jun-06 Jan-07 Aug-07 Mar-08 Oct-08 May-09 Dec-09 Jul-10 Feb-11 Sep-11 Apr-12
TNI BCF
MSCI UAE Index
S&P UAE Dom Capped Index
TNI UAE BLUE CHIP FUND Fact Sheet as of August 30, 2012
Fund Profile
Focus: Although the fund may participate in markets throughout the Gulf Cooperative Countries (‘GCC’), its investments will be primarily focused on publicly traded equities of UAE firms with large capitalization, which present a steady and recurrent track record of earnings growth and have a potential for capital appreciation.
Management Style: The key investment criteria are the company’s financial strengths, competitiveness, profitability, growth prospects and quality of management. The allocation will be based on fundamental research and will incorporate a blend of top-down and a bottom-up analytical approach.
Objective: The fund aims to provide long-term capital appreciation through investing in equity securities publicly traded, primarily in the UAE, and, to a lesser extent, in other GCC markets.
Suitability: Units of the Fund are speculative and involve a high degree of risk. The Fund is therefore designed for sophisticated investors who are able to understand the risks involved in emerging markets’ equity investments, particularly in the GCC equities.
Asset Allocation Top Holdings
Fund Performance (%)
Fund Performance since Inception
WTD -2.1
MTD 4.1
YTD 12.5
Since Inception -62.5
Value Blend Growth Large
Medium
Small
Fund Profile
WTD -1.9
MTD 4.2
YTD 14.3
Since Inception -50.6
Fund Facts
Index comparison is used for illustrative purposes only.
Since Inception %
TNI UAE Blue Chip Fund -50.6
S&P UAE Dom Capped -62.5
MSCI UAE Index -69.8
S&P UAE Dom Capped Index (%)
The National Investor
Headquarters
TNI Tower | Zayed 1st Street Khalidia|
P.O. Box 47435 | Abu Dhabi | UAE
Phone: +971 2 619 2300
Fax: +971 2 619 2331
Email: [email protected]
www.tni.ae
Inception Date May 01, 2005
Base Currency AED
Dealing Currencies AED - USD
Minimum Inv. AED 350,000
NAV / Unit AED 4.94
Net Assets AED 131.48 M
Initial Fee 3% (max.)
Management Fee 1.5% Custody/Admin Fee 0.45% (max.)
Performance Fee 10% subject to High Watermark
Hurdle Rate EIBOR (3M)
Redemption Fee 1% after 1 Year
NAV Weekly (No Lock-up)
Custodian Deutsche Bank
Administrator Deutsche Bank
Auditors KPMG
Lawyers Tamimi & Co
Fund Manager TNI
Domicile UAE
Listing Dubai Financial Market –TNIUAEBCF
Reuters Lp65037579
Bloomberg TNIUAEF UH
Monthly Performance
%
Jan
Feb
Mar
Apr
May
June
July
Aug
Sept
Oct
Nov
Dec
YTD
2005 - - - - 2.7 6.9 -11.2 6.0 5.9 4.3 1.3 -4.1 12.2
2006 -5.4 -4.7 -3.4 -8.5 -5.7 -2.9 -2.4 5.2 2.2 -3.4 -8.4 0.3 -32.9
2007 -0.8 2.5 -5.1 3.7 18.8 -1.7 0.0 -3.8 1.6 18.9 4.4 9.1 54.9
2008 -3.7 7.2 -6.1 9.8 -0.5 -1.8 0.8 -15.0 -15.7 -22.4 -23.2 -12.1 -60.7
2009 -9.7 4.9 8.7 5.8 9.3 -1.8 5.0 4.2 13.2 -2.9 -4.8 -13.1 16.2
2010 -8.3 -3.4 16.7 -1.7 -9.1 -2.9 -1.8 -1.9 10.5 5.0 -4.0 -1.4 -5.1
2011 -0.9 -7.9 6.4 7.0 -5.1 0.5 -1.2 -2.3 -4.9 -2.4 -3.0 -0.8 -14.5
2012 1.6 9.7 3.1 -0.3 -5.7 -0.6 2.2 4.2 1.7 2.8 -0.5 -0.6 18.2
2013 13.4 3.4 1.9 19.4
0%
20%
40%
60%
80%
100%
120%
140%
160%
Apr-05 May-06 Jun-07 Jul-08 Aug-09 Sep-10 Oct-11 Nov-12
TNI BCF
MSCI UAE Index
S&P UAE Dom Capped Index
7.5%
7.6%
7.7%
8.1%
8.7%
0.0% 2.0% 4.0% 6.0% 8.0% 10.0%
ENBD
Emaar
ADCB
Etisalat
NBAD
`
52.9%
32.0%
7.4%2.6%
5.1%
Abu Dhabi
Dubai
Nasdaq DubaiGCC
Cash
TNI UAE BLUE CHIP FUND Fact Sheet as of March 28, 2013
Fund Profile
Focus: Although the fund may participate in markets throughout the Gulf Cooperative Countries (‘GCC’), its investments will be primarily focused on publicly traded equities of UAE firms with large capitalization, which present a steady and recurrent track record of earnings growth and have a potential for capital appreciation.
Management Style: The key investment criteria are the company’s financial strengths, competitiveness, profitability, growth prospects and quality of management. The allocation will be based on fundamental research and will incorporate a blend of top-down and a bottom-up analytical approach.
Objective: The fund aims to provide long-term capital appreciation through investing in equity securities publicly traded, primarily in the UAE, and, to a lesser extent, in other GCC markets.
Suitability: Units of the Fund are speculative and involve a high degree of risk. The Fund is therefore designed for sophisticated investors who are able to understand the risks involved in emerging markets’ equity investments, particularly in the GCC equities.
Asset Allocation Top Holdings
Fund Performance (%)
Fund Performance since Inception
WTD -1.4
MTD -1.2
YTD 17.1
Since Inception -53.6
Value Blend Growth Large
Medium
Small
Fund Profile
WTD -0.3
MTD 1.9
YTD 19.4
Since Inception -38.6
Fund Facts
Index comparison is used for illustrative purposes only.
Since Inception %
TNI UAE Blue Chip Fund -38.6
S&P UAE Dom Capped -53.6
MSCI UAE Index -60.6
S&P UAE Dom Capped Index (%)
The National Investor
Headquarters
TNI Tower | Zayed 1st Street Khalidia|
P.O. Box 47435 | Abu Dhabi | UAE
Phone: +971 2 619 2300
Fax: +971 2 619 2331
Email: [email protected]
www.tni.ae
Inception Date May 01, 2005
Base Currency AED
Dealing Currencies AED - USD
Minimum Inv. AED 350,000
NAV / Unit AED 6.14
Net Assets AED 115.51 M
Initial Fee 3% (max.)
Management Fee 1.5% Custody/Admin Fee 0.45% (max.)
Performance Fee 10% subject to High Watermark
Hurdle Rate EIBOR (3M)
Redemption Fee 1% after 1 Year
NAV Weekly (No Lock-up)
Custodian Deutsche Bank
Administrator Deutsche Bank
Auditors Deloitte
Lawyers Tamimi & Co
Fund Manager TNI
Domicile UAE
Listing Dubai Financial Market –TNIUAEBCF
Reuters Lp65037579
Bloomberg TNIUAEF UH
Monthly Performance
%
Jan
Feb
Mar
Apr
May
June
July
Aug
Sept
Oct
Nov
Dec
YTD
2005 - - - - 2.7 6.9 -11.2 6.0 5.9 4.3 1.3 -4.1 12.2
2006 -5.4 -4.7 -3.4 -8.5 -5.7 -2.9 -2.4 5.2 2.2 -3.4 -8.4 0.3 -32.9
2007 -0.8 2.5 -5.1 3.7 18.8 -1.7 0.0 -3.8 1.6 18.9 4.4 9.1 54.9
2008 -3.7 7.2 -6.1 9.8 -0.5 -1.8 0.8 -15.0 -15.7 -22.4 -23.2 -12.1 -60.7
2009 -9.7 4.9 8.7 5.8 9.3 -1.8 5.0 4.2 13.2 -2.9 -4.8 -13.1 16.2
2010 -8.3 -3.4 16.7 -1.7 -9.1 -2.9 -1.8 -1.9 10.5 5.0 -4.0 -1.4 -5.1
2011 -0.9 -7.9 6.4 7.0 -5.1 0.5 -1.2 -2.3 -4.9 -2.4 -3.0 -0.8 -14.5
2012 1.6 9.7 3.1 -0.3 -5.7 -0.6 2.2 4.2 1.7 2.8 -0.5 -0.6 18.2
2013 13.4 3.4 1.9 19.4
0%
20%
40%
60%
80%
100%
120%
140%
160%
Apr-05 May-06 Jun-07 Jul-08 Aug-09 Sep-10 Oct-11 Nov-12
TNI BCF
MSCI UAE Index
S&P UAE Dom Capped Index
7.5%
7.6%
7.7%
8.1%
8.7%
0.0% 2.0% 4.0% 6.0% 8.0% 10.0%
ENBD
Emaar
ADCB
Etisalat
NBAD
`
52.9%
32.0%
7.4%2.6%
5.1%
Abu Dhabi
Dubai
Nasdaq DubaiGCC
Cash
TNI UAE BLUE CHIP FUND Fact Sheet as of March 28, 2013
Fund Profile
Focus: Although the fund may participate in markets throughout the Gulf Cooperative Countries (‘GCC’), its investments will be primarily focused on publicly traded equities of UAE firms with large capitalization, which present a steady and recurrent track record of earnings growth and have a potential for capital appreciation.
Management Style: The key investment criteria are the company’s financial strengths, competitiveness, profitability, growth prospects and quality of management. The allocation will be based on fundamental research and will incorporate a blend of top-down and a bottom-up analytical approach.
Objective: The fund aims to provide long-term capital appreciation through investing in equity securities publicly traded, primarily in the UAE, and, to a lesser extent, in other GCC markets.
Suitability: Units of the Fund are speculative and involve a high degree of risk. The Fund is therefore designed for sophisticated investors who are able to understand the risks involved in emerging markets’ equity investments, particularly in the GCC equities.
Asset Allocation Top Holdings
Fund Performance (%)
Fund Performance since Inception
WTD -1.4
MTD -1.2
YTD 17.1
Since Inception -53.6
Value Blend Growth Large
Medium
Small
Fund Profile
WTD -0.3
MTD 1.9
YTD 19.4
Since Inception -38.6
Fund Facts
Index comparison is used for illustrative purposes only.
Since Inception %
TNI UAE Blue Chip Fund -38.6
S&P UAE Dom Capped -53.6
MSCI UAE Index -60.6
S&P UAE Dom Capped Index (%)
The National Investor
Headquarters
TNI Tower | Zayed 1st Street Khalidia|
P.O. Box 47435 | Abu Dhabi | UAE
Phone: +971 2 619 2300
Fax: +971 2 619 2331
Email: [email protected]
www.tni.ae
Inception Date May 01, 2005
Base Currency AED
Dealing Currencies AED - USD
Minimum Inv. AED 350,000
NAV / Unit AED 6.14
Net Assets AED 115.51 M
Initial Fee 3% (max.)
Management Fee 1.5% Custody/Admin Fee 0.45% (max.)
Performance Fee 10% subject to High Watermark
Hurdle Rate EIBOR (3M)
Redemption Fee 1% after 1 Year
NAV Weekly (No Lock-up)
Custodian Deutsche Bank
Administrator Deutsche Bank
Auditors Deloitte
Lawyers Tamimi & Co
Fund Manager TNI
Domicile UAE
Listing Dubai Financial Market –TNIUAEBCF
Reuters Lp65037579
Bloomberg TNIUAEF UH
8.1%
8.8%
8.9%
8.9%
9.5%
0.0% 2.0% 4.0% 6.0% 8.0% 10.0%
ENBD
NBAD
Emaar
FGB
Etisalat
`
48.2%
33.5%
7.8%
10.5%
Abu Dhabi
Dubai
DIFX
Cash
TNI UAE BLUE CHIP FUNDFact Sheet as of June 30, 2011
Fund Profile
Focus: Although the fund may participate in markets throughout the Gulf Cooperative
Countries (‘GCC’), its investments will be primarily focused on publicly traded equities of UAE
firms with large capitalization, which present a steady and recurrent track record of earnings
growth and have a potential for capital appreciation.
Management Style: The key investment criteria are the company’s financial strengths,
competitiveness, profitability, growth prospects and quality of management. The allocation
will be based on fundamental research and will incorporate a blend of top-down and a
bottom-up analytical approach.
Objective: The fund aims to provide long-term capital appreciation through investing in
equity securities publicly traded, primarily in the UAE, and, to a lesser extent, in other GCC
markets.
Suitability: Units of the Fund are speculative and involve a high degree of risk. The Fund is
therefore designed for sophisticated investors who are able to understand the risks involved
in emerging markets’ equity investments, particularly in the GCC equities.
Asset Allocation Top Holdings
Fund Performance since Inception
Fund Performance (%)
Monthly PerformanceWTD -0.9
MTD 0.9
YTD -1.3
Since Inception -61.3
Value Blend GrowthLarge
Medium
Small
Fund Profile
WTD -0.9
MTD 0.5
YTD -0.8
Since Inception -49.8
Fund Facts
Index comparison is used for illustrative purposes only.
% Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec YTD
2005 - - - - 2.7 6.9 -11.2 6.0 5.9 4.3 1.3 -4.1 12.2
2006 -5.4 -4.7 -3.4 -8.5 -5.7 -2.9 -2.4 5.2 2.2 -3.4 -8.4 0.3 -32.9
2007 -0.8 2.5 -5.1 3.7 18.8 -1.7 0.0 -3.8 1.6 18.9 4.4 9.1 54.9
2008 -3.7 7.2 -6.1 9.8 -0.5 -1.8 0.8 -15.0 -15.7 -22.4 -23.2 -12.1 -60.7
2009 -9.7 4.9 8.7 5.8 9.3 -1.8 5.0 4.2 13.2 -2.9 -4.8 -13.1 16.2
2010 -8.3 -3.4 16.7 -1.7 -9.1 -2.9 -1.8 -1.9 10.5 5.0 -4.0 -1.4 -5.1
2011 -0.9 -7.9 6.4 7.0 -5.1 0.5 -0.8
Inception Date May 01, 2005
Base Currency AED
Dealing Currencies AED - USD
Minimum Inv. AED 350,000
NAV / Unit AED 5.02
Net Assets AED 127.40m
Initial Fee 3% (max.)
Management Fee 1.5%
Custody/Admin Fee 0.45% (max.)
Performance Fee 10% subject to High Watermark
Hurdle Rate EIBOR (3M)
Redemption Fee 1% after 1 Year
NAV Weekly (No Lock-up)
Custodian Deutsche Bank
Administrator Deutsche Bank
Auditors KPMG
Lawyers Tamimi & Co
Fund Manager TNI
Domicile UAE
ListingDubai Financial Market –TNIUAEBCF
Reuters Lp65037579
Bloomberg TNIUAEF UH Since Inception %
TNI UAE Blue Chip Fund -49.8
S&P UAE Dom Capped -61.3
MSCI UAE Index -69.3
S&P UAE Dom Capped Index (%)
The National Investor
Headquarters
TNI Tower | Zayed 1st Street Khalidiya|
P.O. Box 47435 | Abu Dhabi | UAE
Phone: +971 2 619 2300
Fax: +971 2 619 2400
Email: [email protected]
www.tni.ae
0%
20%
40%
60%
80%
100%
120%
140%
160%
Apr-05 Apr-06 Apr-07 Apr-08 Apr-09 Apr-10 Apr-11
TNI BCF
MSCI UAE Index
S&P UAE Dom Capped Index
Monthly Performance
%
Jan
Feb
Mar
Apr
May
June
July
Aug
Sept
Oct
Nov
Dec
YTD
2005 - - - - 2.7 6.9 -11.2 6.0 5.9 4.3 1.3 -4.1 12.2
2006 -5.4 -4.7 -3.4 -8.5 -5.7 -2.9 -2.4 5.2 2.2 -3.4 -8.4 0.3 -32.9
2007 -0.8 2.5 -5.1 3.7 18.8 -1.7 0.0 -3.8 1.6 18.9 4.4 9.1 54.9
2008 -3.7 7.2 -6.1 9.8 -0.5 -1.8 0.8 -15.0 -15.7 -22.4 -23.2 -12.1 -60.7
2009 -9.7 4.9 8.7 5.8 9.3 -1.8 5.0 4.2 13.2 -2.9 -4.8 -13.1 16.2
2010 -8.3 -3.4 16.7 -1.7 -9.1 -2.9 -1.8 -1.9 10.5 5.0 -4.0 -1.4 -5.1
2011 -0.9 -7.9 6.4 7.0 -5.1 0.5 -1.2 -2.3 -4.9 -2.4 -3.0 -0.8 -14.5
2012 1.6 9.7 3.1 -0.3 -5.7 -0.6 2.2 4.2 1.7 2.8 -0.5 -0.6 18.2
2013 13.4 3.4 1.9 19.4
0%
20%
40%
60%
80%
100%
120%
140%
160%
Apr-05 May-06 Jun-07 Jul-08 Aug-09 Sep-10 Oct-11 Nov-12
TNI BCF
MSCI UAE Index
S&P UAE Dom Capped Index
7.5%
7.6%
7.7%
8.1%
8.7%
0.0% 2.0% 4.0% 6.0% 8.0% 10.0%
ENBD
Emaar
ADCB
Etisalat
NBAD
`
52.9%
32.0%
7.4%2.6%
5.1%
Abu Dhabi
Dubai
Nasdaq DubaiGCC
Cash
TNI UAE BLUE CHIP FUND Fact Sheet as of March 28, 2013
Fund Profile
Focus: Although the fund may participate in markets throughout the Gulf Cooperative Countries (‘GCC’), its investments will be primarily focused on publicly traded equities of UAE firms with large capitalization, which present a steady and recurrent track record of earnings growth and have a potential for capital appreciation.
Management Style: The key investment criteria are the company’s financial strengths, competitiveness, profitability, growth prospects and quality of management. The allocation will be based on fundamental research and will incorporate a blend of top-down and a bottom-up analytical approach.
Objective: The fund aims to provide long-term capital appreciation through investing in equity securities publicly traded, primarily in the UAE, and, to a lesser extent, in other GCC markets.
Suitability: Units of the Fund are speculative and involve a high degree of risk. The Fund is therefore designed for sophisticated investors who are able to understand the risks involved in emerging markets’ equity investments, particularly in the GCC equities.
Asset Allocation Top Holdings
Fund Performance (%)
Fund Performance since Inception
WTD -1.4
MTD -1.2
YTD 17.1
Since Inception -53.6
Value Blend Growth Large
Medium
Small
Fund Profile
WTD -0.3
MTD 1.9
YTD 19.4
Since Inception -38.6
Fund Facts
Index comparison is used for illustrative purposes only.
Since Inception %
TNI UAE Blue Chip Fund -38.6
S&P UAE Dom Capped -53.6
MSCI UAE Index -60.6
S&P UAE Dom Capped Index (%)
The National Investor
Headquarters
TNI Tower | Zayed 1st Street Khalidia|
P.O. Box 47435 | Abu Dhabi | UAE
Phone: +971 2 619 2300
Fax: +971 2 619 2331
Email: [email protected]
www.tni.ae
Inception Date May 01, 2005
Base Currency AED
Dealing Currencies AED - USD
Minimum Inv. AED 350,000
NAV / Unit AED 6.14
Net Assets AED 115.51 M
Initial Fee 3% (max.)
Management Fee 1.5% Custody/Admin Fee 0.45% (max.)
Performance Fee 10% subject to High Watermark
Hurdle Rate EIBOR (3M)
Redemption Fee 1% after 1 Year
NAV Weekly (No Lock-up)
Custodian Deutsche Bank
Administrator Deutsche Bank
Auditors Deloitte
Lawyers Tamimi & Co
Fund Manager TNI
Domicile UAE
Listing Dubai Financial Market –TNIUAEBCF
Reuters Lp65037579
Bloomberg TNIUAEF UH
Fund
Ret
urn
(%)
Benchmark Return (%)
0%
5%
10%
15%
20%
25%
Apr-06 Jul-07 Oct-08 Jan-10 Apr-11 Jul-12
``
TNI UAE BLUE CHIP FUND Fund Analytics as of March 28, 2013
Regression Analysis
TNI UAE Blue Chip Fund Vs MSCI UAE Index
Asset allocation by Sector (%) Deviation by Sector (%)
Asset allocation by Exchange (%) Deviation by Exchange (%)
Returns
(%)
TNI
BCF
S&P
Cap
MSCI UAE
1M 1.9 -1.2 -0.5
3M 19.4 17.1 23.1
6M 22.2 20.8 27.4
1Y 23.7 20.1 29.9
3Y 11.4 6.6 7.1
Inc -38.6 -53.6 -61.9
PE PB ROE
%
MCap
(AED B)
TNI BCF 10.9 1.1 10.4 23.3
S&P UAE
Capped 12.1 1.2 11.3 24.5
MSCI
UAE 12.1 1.3 10.8 24.0
1Y 2Y 3Y Since Inception
Relative Alpha 3.5 1.0 1.5 3.3 Ann. Return 23.7 11.8 3.7 -6.0
Volatility 15.2 15.4 16.7 26.1
Tracking Error 4.1 3.7 3.9 10.7
Info. Ratio 0.9 0.3 0.4 0.3
Annualised based on monthly data
Evolution of Yearly Tracking Error
Total Bull Bear
Beta 0.7 0.7 0.7
Info Ratio 0.2 -2.0 1.7
Sortino 0.1 -1.6 0.8
Correl 0.9 0.8 0.8
0.0
1.8
3.6
3.9
4.3
5.1
6.2
10.8
16.1
48.2
-20 0 20 40 60
Materials
Investments
Transport
Services
Utilities
Cash
Marine
Telecoms
Real Estate
Banking
- 0.7
- 1.5
- 0.3
0.0
0.3
5.1
- 0.2
- 1.4
- 2.3
0.8
-8 -6 -4 -2 0 2 4 6 8
2.6
5.1
7.4
32.0
52.8
-20 0 20 40 60
GCC
Cash
Nasdaq
Dubai
Abu Dhabi
2.6
5.1
1.1
- 2.7
- 6.1
-10 -5 0 5 10
Fund
Ret
urn
(%)
Benchmark Return (%)
0%
5%
10%
15%
20%
25%
Apr-06 Jul-07 Oct-08 Jan-10 Apr-11 Jul-12
``
TNI UAE BLUE CHIP FUND Fund Analytics as of March 28, 2013
Regression Analysis
TNI UAE Blue Chip Fund Vs MSCI UAE Index
Asset allocation by Sector (%) Deviation by Sector (%)
Asset allocation by Exchange (%) Deviation by Exchange (%)
Returns
(%)
TNI
BCF
S&P
Cap
MSCI UAE
1M 1.9 -1.2 -0.5
3M 19.4 17.1 23.1
6M 22.2 20.8 27.4
1Y 23.7 20.1 29.9
3Y 11.4 6.6 7.1
Inc -38.6 -53.6 -61.9
PE PB ROE
%
MCap
(AED B)
TNI BCF 10.9 1.1 10.4 23.3
S&P UAE
Capped 12.1 1.2 11.3 24.5
MSCI
UAE 12.1 1.3 10.8 24.0
1Y 2Y 3Y Since Inception
Relative Alpha 3.5 1.0 1.5 3.3 Ann. Return 23.7 11.8 3.7 -6.0
Volatility 15.2 15.4 16.7 26.1
Tracking Error 4.1 3.7 3.9 10.7
Info. Ratio 0.9 0.3 0.4 0.3
Annualised based on monthly data
Evolution of Yearly Tracking Error
Total Bull Bear
Beta 0.7 0.7 0.7
Info Ratio 0.2 -2.0 1.7
Sortino 0.1 -1.6 0.8
Correl 0.9 0.8 0.8
0.0
1.8
3.6
3.9
4.3
5.1
6.2
10.8
16.1
48.2
-20 0 20 40 60
Materials
Investments
Transport
Services
Utilities
Cash
Marine
Telecoms
Real Estate
Banking
- 0.7
- 1.5
- 0.3
0.0
0.3
5.1
- 0.2
- 1.4
- 2.3
0.8
-8 -6 -4 -2 0 2 4 6 8
2.6
5.1
7.4
32.0
52.8
-20 0 20 40 60
GCC
Cash
Nasdaq
Dubai
Abu Dhabi
2.6
5.1
1.1
- 2.7
- 6.1
-10 -5 0 5 10
Fund Performance since inception
Asset Allocation
3.3%
3.6%
3.9%
4.3%
6.4%
SABIC P Note
QNB
Zain
NBK
Al Rajhi P Note
TNI MENA UCITS FUND Fact Sheet as of January 31, 2013
Fund Profile
Focus: Fund investments will be primarily focused on publicly traded equities in the Middle East and North Africa (MENA) region with large capitalization, which present a steady and recurrent track record of earnings growth and have a potential for capital appreciation.
Management Style: The key investment criteria are the company’s financial strengths, competitiveness, profitability, growth prospects and quality of management. The allocation will be based on fundamental research and will incorporate a blend of top-down and a bottom-up analytical approach. Allocation of the fund will follow UCITS-3 guidelines.
Fund Objective: The Fund shall provide long-term capital appreciation through investing in equity securities publicly traded, in the Middle East and North Africa (MENA) region. The fund aims to outperform the S&P Pan Arab Large-Mid 5/10/40 Index on a risk-adjusted return basis.
Suitability: Shares of in the sub-Fund are speculative and involve a high degree of risk. The Fund is therefore designed for sophisticated investors who are able to understand the risks involved in emerging markets’ equity investments, particularly in the MENA equities.
Since Inception %
TNI MENA UCITS Fund 7.5
S&P Pan Arab Large-Mid 5/10/40 Index 3.2
S&P Pan Arab 3.5
%
Jan
Feb
Mar
Apr
May
June
July
Aug
Sept
Oct
Nov
Dec
YTD
2010 - - - - - 0.4 1.6 -0.8 5.8 0.4 0.3 3.7 9.9
2011 -1.6 -6.5 2.2 3.2 -2.6 -2.4 -1.3 -4.4 -1.6 0.8 -3.2 1.2 -15.5
2012 0.9 7.4 7.2 -1.7 -5.7 -2.8 1.5 4.3 0.3 -0.1 -2.4 2.8 11.3
2013 4.1 4.1
Value Blend Growth Large
Medium
Small
Fund Profile
WTD 1.2
MTD 4.1
YTD 4.1
Since Inception 7.5
Fund Facts
Inception Date June 17, 2010
Base Currency USD
Minimum Inv. USD 100,000
NAV / Unit USD 1,075.16
Net Assets USD 28.8 M
Initial Fee 3% (max.)
Management Fee 1.4%
Custody / Admin Fee 0.45% (max.)
Performance Fee 10% subject to High Watermark
Redemption fee 0% after 1 year
NAV Weekly (No lock-up)
Custodian Citibank (Dublin)
Administrator Apex Fund Services
Auditors Deloitte
Lawyers Mason, Hayes & Curran
Fund manager TNI(Dubai) LTD
Domicile Dublin
Listing Irish Stock Exchange
ISIN IE00B5TKJM01
Reuters LP68056061
Bloomberg TNIMENA
S&P Pan Arab 5/10/40 Index (%)
WTD 0.7
MTD 3.6
YTD 3.6
Since Inception 3.2
The National Investor
Headquarters
TNI Tower | Zayed 1st Street Khalidiya|
P.O. Box 47435 | Abu Dhabi | UAE
Phone: +971 2 619 2300
Fax: +971 2 619 2331
Email: [email protected]
www.tni.ae
Top Holdings
Fund Performance (%)
Monthly Performance (%)
Index comparison is used for illustrative purposes only.
39.8%
15.6%
10.7%
8.7%
8.1%
5.8%5.5%
2.7%
2.4%
0.7%
0.0%
KSA
Kuwait
UAE
Egypt
Qatar
CashMorocco
Oman
Jordan
Bahrain
Lebanon
85%
90%
95%
100%
105%
110%
115%
120%
Jun-10 Aug-10 Oct-10 Dec-10 Feb-11 Apr-11 Jun-11 Aug-11 Oct-11 Dec-11 Feb-12 Apr-12 Jun-12 Aug-12 Oct-12 Dec-12
MENA UCITS S&P Pan Arab 5/10/40 Capped S&P Pan Arab
Fund Performance since inception
Asset Allocation
TNI MENA UCITS FUND Fact Sheet as of March 28, 2013
Fund Profile
Focus: Fund investments will be primarily focused on publicly traded equities in the Middle East and North Africa (MENA) region with large capitalization, which present a steady and recurrent track record of earnings growth and have a potential for capital appreciation.
Management Style: The key investment criteria are the company’s financial strengths, competitiveness, profitability, growth prospects and quality of management. The allocation will be based on fundamental research and will incorporate a blend of top-down and a bottom-up analytical approach. Allocation of the fund will follow UCITS-3 guidelines.
Fund Objective: The Fund shall provide long-term capital appreciation through investing in equity securities publicly traded, in the Middle East and North Africa (MENA) region. The fund aims to outperform the S&P Pan Arab Large-Mid 5/10/40 Index on a risk-adjusted return basis.
Suitability: Shares of in the sub-Fund are speculative and involve a high degree of risk. The Fund is therefore designed for sophisticated investors who are able to understand the risks involved in emerging markets’ equity investments, particularly in the MENA equities.
Since Inception %
TNI MENA UCITS Fund 7.9
S&P Pan Arab Large-Mid 5/10/40 Index 2.3
S&P Pan Arab 3.1
%
Jan
Feb
Mar
Apr
May
June
July
Aug
Sept
Oct
Nov
Dec YTD
2010 - - - - - 0.4 1.6 -0.8 5.8 0.4 0.3 3.7 9.9
2011 -1.6 -6.5 2.2 3.2 -2.6 -2.4 -1.3 -4.4 -1.6 0.8 -3.2 1.2 -15.5
2012 0.9 7.4 7.2 -1.7 -5.7 -2.8 1.5 4.3 0.3 -0.1 -2.4 2.8 11.3
2013 4.1 -0.7 1.1 4.5
Value Blend Growth Large
Medium
Small
Fund Profile
WTD 0.6
MTD 1.1
YTD 4.5
Since Inception 7.9
Fund Facts
Inception Date June 17, 2010
Base Currency USD
Minimum Inv. USD 100,000
NAV / Unit USD 1,079.16
Net Assets USD 28.9M
Initial Fee 3% (max.)
Management Fee 1.4%
Custody / Admin Fee 0.45% (max.)
Performance Fee 10% subject to High Watermark
Redemption fee 0% after 1 year
NAV Weekly (No lock-up)
Custodian Citibank (Dublin)
Administrator Apex Fund Services
Auditors Deloitte
Lawyers Mason, Hayes & Curran
Fund manager TNI(Dubai) LTD
Domicile Dublin
Listing Irish Stock Exchange
ISIN IE00B5TKJM01
Reuters LP68056061
Bloomberg TNIMENA
S&P Pan Arab 5/10/40 Index (%) WTD 0.1
MTD -0.1
YTD 2.7
Since Inception 2.3
The National Investor
Headquarters
TNI Tower | Zayed 1st Street Khalidiya|
P.O. Box 47435 | Abu Dhabi | UAE
Phone: +971 2 619 2300
Fax: +971 2 619 2331
Email: [email protected]
www.tni.ae
Top Holdings
Fund Performance (%)
Monthly Performance (%)
Index comparison is used for illustrative purposes only.
46.5%
14.2%
10.4%
8.0%
5.9%
3.6%3.5%
2.9%
2.5%
1.8%
0.7%
KSA
Kuwait
UAE
Qatar
Egypt
MoroccoCash
Jordan
Lebanon
Oman
Bahrain
2.9%
3.0%
3.7%
4.7%
4.7%
DAAR P Note
NIC P Note
UNB
NBK
Al Rajhi P Note
85%
90%
95%
100%
105%
110%
115%
120%
Jun-10 Oct-10 Feb-11 Jun-11 Oct-11 Feb-12 Jun-12 Oct-12 Feb-13
MENA UCITS S&P Pan Arab 5/10/40 Capped S&P Pan Arab
Fund Performance since inception
Asset Allocation
TNI MENA UCITS FUND Fact Sheet as of March 28, 2013
Fund Profile
Focus: Fund investments will be primarily focused on publicly traded equities in the Middle East and North Africa (MENA) region with large capitalization, which present a steady and recurrent track record of earnings growth and have a potential for capital appreciation.
Management Style: The key investment criteria are the company’s financial strengths, competitiveness, profitability, growth prospects and quality of management. The allocation will be based on fundamental research and will incorporate a blend of top-down and a bottom-up analytical approach. Allocation of the fund will follow UCITS-3 guidelines.
Fund Objective: The Fund shall provide long-term capital appreciation through investing in equity securities publicly traded, in the Middle East and North Africa (MENA) region. The fund aims to outperform the S&P Pan Arab Large-Mid 5/10/40 Index on a risk-adjusted return basis.
Suitability: Shares of in the sub-Fund are speculative and involve a high degree of risk. The Fund is therefore designed for sophisticated investors who are able to understand the risks involved in emerging markets’ equity investments, particularly in the MENA equities.
Since Inception %
TNI MENA UCITS Fund 7.9
S&P Pan Arab Large-Mid 5/10/40 Index 2.3
S&P Pan Arab 3.1
%
Jan
Feb
Mar
Apr
May
June
July
Aug
Sept
Oct
Nov
Dec YTD
2010 - - - - - 0.4 1.6 -0.8 5.8 0.4 0.3 3.7 9.9
2011 -1.6 -6.5 2.2 3.2 -2.6 -2.4 -1.3 -4.4 -1.6 0.8 -3.2 1.2 -15.5
2012 0.9 7.4 7.2 -1.7 -5.7 -2.8 1.5 4.3 0.3 -0.1 -2.4 2.8 11.3
2013 4.1 -0.7 1.1 4.5
Value Blend Growth Large
Medium
Small
Fund Profile
WTD 0.6
MTD 1.1
YTD 4.5
Since Inception 7.9
Fund Facts
Inception Date June 17, 2010
Base Currency USD
Minimum Inv. USD 100,000
NAV / Unit USD 1,079.16
Net Assets USD 28.9M
Initial Fee 3% (max.)
Management Fee 1.4%
Custody / Admin Fee 0.45% (max.)
Performance Fee 10% subject to High Watermark
Redemption fee 0% after 1 year
NAV Weekly (No lock-up)
Custodian Citibank (Dublin)
Administrator Apex Fund Services
Auditors Deloitte
Lawyers Mason, Hayes & Curran
Fund manager TNI(Dubai) LTD
Domicile Dublin
Listing Irish Stock Exchange
ISIN IE00B5TKJM01
Reuters LP68056061
Bloomberg TNIMENA
S&P Pan Arab 5/10/40 Index (%) WTD 0.1
MTD -0.1
YTD 2.7
Since Inception 2.3
The National Investor
Headquarters
TNI Tower | Zayed 1st Street Khalidiya|
P.O. Box 47435 | Abu Dhabi | UAE
Phone: +971 2 619 2300
Fax: +971 2 619 2331
Email: [email protected]
www.tni.ae
Top Holdings
Fund Performance (%)
Monthly Performance (%)
Index comparison is used for illustrative purposes only.
46.5%
14.2%
10.4%
8.0%
5.9%
3.6%3.5%
2.9%
2.5%
1.8%
0.7%
KSA
Kuwait
UAE
Qatar
Egypt
MoroccoCash
Jordan
Lebanon
Oman
Bahrain
2.9%
3.0%
3.7%
4.7%
4.7%
DAAR P Note
NIC P Note
UNB
NBK
Al Rajhi P Note
85%
90%
95%
100%
105%
110%
115%
120%
Jun-10 Oct-10 Feb-11 Jun-11 Oct-11 Feb-12 Jun-12 Oct-12 Feb-13
MENA UCITS S&P Pan Arab 5/10/40 Capped S&P Pan Arab
8.1%
8.8%
8.9%
8.9%
9.5%
0.0% 2.0% 4.0% 6.0% 8.0% 10.0%
ENBD
NBAD
Emaar
FGB
Etisalat
`
48.2%
33.5%
7.8%
10.5%
Abu Dhabi
Dubai
DIFX
Cash
TNI UAE BLUE CHIP FUNDFact Sheet as of June 30, 2011
Fund Profile
Focus: Although the fund may participate in markets throughout the Gulf Cooperative
Countries (‘GCC’), its investments will be primarily focused on publicly traded equities of UAE
firms with large capitalization, which present a steady and recurrent track record of earnings
growth and have a potential for capital appreciation.
Management Style: The key investment criteria are the company’s financial strengths,
competitiveness, profitability, growth prospects and quality of management. The allocation
will be based on fundamental research and will incorporate a blend of top-down and a
bottom-up analytical approach.
Objective: The fund aims to provide long-term capital appreciation through investing in
equity securities publicly traded, primarily in the UAE, and, to a lesser extent, in other GCC
markets.
Suitability: Units of the Fund are speculative and involve a high degree of risk. The Fund is
therefore designed for sophisticated investors who are able to understand the risks involved
in emerging markets’ equity investments, particularly in the GCC equities.
Asset Allocation Top Holdings
Fund Performance since Inception
Fund Performance (%)
Monthly PerformanceWTD -0.9
MTD 0.9
YTD -1.3
Since Inception -61.3
Value Blend GrowthLarge
Medium
Small
Fund Profile
WTD -0.9
MTD 0.5
YTD -0.8
Since Inception -49.8
Fund Facts
Index comparison is used for illustrative purposes only.
% Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec YTD
2005 - - - - 2.7 6.9 -11.2 6.0 5.9 4.3 1.3 -4.1 12.2
2006 -5.4 -4.7 -3.4 -8.5 -5.7 -2.9 -2.4 5.2 2.2 -3.4 -8.4 0.3 -32.9
2007 -0.8 2.5 -5.1 3.7 18.8 -1.7 0.0 -3.8 1.6 18.9 4.4 9.1 54.9
2008 -3.7 7.2 -6.1 9.8 -0.5 -1.8 0.8 -15.0 -15.7 -22.4 -23.2 -12.1 -60.7
2009 -9.7 4.9 8.7 5.8 9.3 -1.8 5.0 4.2 13.2 -2.9 -4.8 -13.1 16.2
2010 -8.3 -3.4 16.7 -1.7 -9.1 -2.9 -1.8 -1.9 10.5 5.0 -4.0 -1.4 -5.1
2011 -0.9 -7.9 6.4 7.0 -5.1 0.5 -0.8
Inception Date May 01, 2005
Base Currency AED
Dealing Currencies AED - USD
Minimum Inv. AED 350,000
NAV / Unit AED 5.02
Net Assets AED 127.40m
Initial Fee 3% (max.)
Management Fee 1.5%
Custody/Admin Fee 0.45% (max.)
Performance Fee 10% subject to High Watermark
Hurdle Rate EIBOR (3M)
Redemption Fee 1% after 1 Year
NAV Weekly (No Lock-up)
Custodian Deutsche Bank
Administrator Deutsche Bank
Auditors KPMG
Lawyers Tamimi & Co
Fund Manager TNI
Domicile UAE
ListingDubai Financial Market –TNIUAEBCF
Reuters Lp65037579
Bloomberg TNIUAEF UH Since Inception %
TNI UAE Blue Chip Fund -49.8
S&P UAE Dom Capped -61.3
MSCI UAE Index -69.3
S&P UAE Dom Capped Index (%)
The National Investor
Headquarters
TNI Tower | Zayed 1st Street Khalidiya|
P.O. Box 47435 | Abu Dhabi | UAE
Phone: +971 2 619 2300
Fax: +971 2 619 2400
Email: [email protected]
www.tni.ae
0%
20%
40%
60%
80%
100%
120%
140%
160%
Apr-05 Apr-06 Apr-07 Apr-08 Apr-09 Apr-10 Apr-11
TNI BCF
MSCI UAE Index
S&P UAE Dom Capped Index
-4
-3
-2
-1
0
1
2
3
4
-4 -3 -2 -1 0 1 2 3 4 5
Benchmark Return (%)
2.2%
2.4%
2.6%
2.8%
3.0%
Mar-12 May-12 Jul-12 Sep-12 Nov-12 Jan-13
TNI MENA UCITS FUND Fund Analytics as of March 28, 2013
Regression Analysis TNI MENA UCITS Fund Vs S&P Pan Arab Large Mid Cap Index
Asset allocation by Geography (%) Deviation by Geography (%)
Asset allocation by Sector (%) Deviation by Sector (%)
Fund
Ret
urn
(%) Returns
(%)
MENA
UCITS
S&P Pan
Arab
Capped
S&P
Pan
Arab
1W 0.6 0.1 0.3
1M 1.1 -0.1 0.5
3M 4.5 2.7 3.0
YTD 4.5 2.7 3.0
Inc 7.9 2.3 3.1
W.Avg. PE
W.Avg. P/B
W. Avg.
ROE%
Mkt Cap
(US$B) MENA UCITS 12.4 1.8 13.2 10.1
S&P PAN Arab
Capped 10.5 1.6 10.9 10.7
S&P Pan Arab 13.7 1.6 16.1 9.9
W.Avg. PE
W.Avg. P/B
W. Avg. ROE%
Banking 13.6 1.8 13.8
Real Estate 12.3 1.6 12.6
Industry 12.0 1.8 14.8
Telecoms 13.9 2.7 18.9
Services 12.8 3.6 6.9
Total Bull Bear
Beta 0.9 1.1 0.9
Info Ratio -0.6 -1.1 0.6
Sortino -0.4 -1.1 0.4
Correl 0.8 0.7 1.0
Evolution of Yearly Tracking Error
3.5
8.1
12.5
12.7
18.9
44.2
-15 -5 5 15 25 35 45 55
Cash
Services
Real Estate
Telecoms
Industry
Banking
3.5
0.4
- 0.5
- 1.1
0.0
- 2.4
-10 -5 0 5 10
0.0 0.7 1.8 2.5 2.9 3.6 3.6
5.9 8.0
10.4 14.2
46.5
-20 -10 0 10 20 30 40 50 60 Tunisia
Bahrain Oman
Lebanon Jordan
Cash Morocco
Egypt Qatar
UAE Kuwait
Saudi Arabia
- 0.9 - 1.2 - 1.3
0.2 - 0.7
3.6 - 1.3 - 0.8
- 2.1 - 0.7
- 4.8 10.1
-12 -7 -2 3 8 13
-4
-3
-2
-1
0
1
2
3
4
-4 -3 -2 -1 0 1 2 3 4 5
Benchmark Return (%)
2.2%
2.4%
2.6%
2.8%
3.0%
Mar-12 May-12 Jul-12 Sep-12 Nov-12 Jan-13
TNI MENA UCITS FUND Fund Analytics as of March 28, 2013
Regression Analysis TNI MENA UCITS Fund Vs S&P Pan Arab Large Mid Cap Index
Asset allocation by Geography (%) Deviation by Geography (%)
Asset allocation by Sector (%) Deviation by Sector (%)
Fund
Ret
urn
(%) Returns
(%)
MENA
UCITS
S&P Pan
Arab
Capped
S&P
Pan
Arab
1W 0.6 0.1 0.3
1M 1.1 -0.1 0.5
3M 4.5 2.7 3.0
YTD 4.5 2.7 3.0
Inc 7.9 2.3 3.1
W.Avg. PE
W.Avg. P/B
W. Avg.
ROE%
Mkt Cap
(US$B) MENA UCITS 12.4 1.8 13.2 10.1
S&P PAN Arab
Capped 10.5 1.6 10.9 10.7
S&P Pan Arab 13.7 1.6 16.1 9.9
W.Avg. PE
W.Avg. P/B
W. Avg. ROE%
Banking 13.6 1.8 13.8
Real Estate 12.3 1.6 12.6
Industry 12.0 1.8 14.8
Telecoms 13.9 2.7 18.9
Services 12.8 3.6 6.9
Total Bull Bear
Beta 0.9 1.1 0.9
Info Ratio -0.6 -1.1 0.6
Sortino -0.4 -1.1 0.4
Correl 0.8 0.7 1.0
Evolution of Yearly Tracking Error
3.5
8.1
12.5
12.7
18.9
44.2
-15 -5 5 15 25 35 45 55
Cash
Services
Real Estate
Telecoms
Industry
Banking
3.5
0.4
- 0.5
- 1.1
0.0
- 2.4
-10 -5 0 5 10
0.0 0.7 1.8 2.5 2.9 3.6 3.6
5.9 8.0
10.4 14.2
46.5
-20 -10 0 10 20 30 40 50 60 Tunisia
Bahrain Oman
Lebanon Jordan
Cash Morocco
Egypt Qatar
UAE Kuwait
Saudi Arabia
- 0.9 - 1.2 - 1.3
0.2 - 0.7
3.6 - 1.3 - 0.8
- 2.1 - 0.7
- 4.8 10.1
-12 -7 -2 3 8 13
40%
50%
60%
70%
80%
90%
100%
110%
120%
130%
Aug-08 May-09 Feb-10 Nov-10 Aug-11 May-12 Feb-13
TNI SSF S&P Composite
Cash 24 %
Iraq 12.7 %
KSA 21.9 %
Others 9.1 %
Kuwait 9.3 %
UAE 23 %
6.0%
6.7%
6.8%
9.3%
9.3%
ASTRA
Asiacell
SAMBA
DIB Sukuk 03/49
KIPCO Bond 10/16
TNI MENA SPECIAL SITUATIONS FUND Fact Sheet as of March 31, 2013
Fund Profile
Focus: Achieve absolute return by investing in special situations in the Middle East and North Africa (MENA) region, primarily focusing on corporate securities and instruments issued by regional firms.
Management Style: The allocation will be based on fundamental research and will incorporate a blend of top-down and a bottom-up analytical approach, with a focus on bottom-up approach. Portfolio construction will be diversified amongst asymmetric risk/reward investment ideas, with a major focus on capital preservation.
Objective: The Fund aims to generate long-term capital growth by investing primarily in special opportunities and situations in the Middle East and North Africa (MENA) region. Special situations/opportunities include investments in securities such as equities, convertibles, derivatives and debt instruments.
Suitability: Shares of the Fund are speculative and involve a high degree of risk. The Fund is therefore designed for sophisticated investors who are able to understand the risks involved in emerging markets’ securities investments, particularly in the MENA region.
Asset Allocation by Geography Top Holdings (ex. Money Market)
MTD 1.1
YTD 3.4
Since Inception 6.9
Fund Performance (%)
Fund Facts
S&P Composite Large Mid Cap (%)
%
Jan
Feb
Mar
Apr
May
June
July
Aug
Sept
Oct
Nov
Dec
YTD
2008 - - - - - - - - -0.2 -4.0 1.3 0.0 -2.9
2009 -1.0 -0.5 1.9 2.8 3.0 -0.3 3.7 1.8 5.0 1.5 -7.5 0.8 11.2
2010 1.1 1.6 3.7 1.7 -5.9 -1.1 2.1 -0.4 2.7 -1.5 -0.1 2.5 6.3
2011 -4.8 -2.4 -2.6 0.8 -1.9 -0.5 0.3 -0.7 -1.0 -0.9 -1.9 0.8 -14.0
2012 0.4 2.5 -0.0 0.1 -1.7 -0.6 2.9 1.3 0.4 0.5 -1.0 -0.2 4.7
2013 3.2 -0.8 1.1 3.4
Inception date Sept 01, 2008
Base Currency USD
Minimum Inv. USD 100,000
NAV / Unit USD 1068.84
Net Assets USD 7.9M
Initial Fee 3% (max.)
Management Fee 1.75%
Custody/Admin Fee 0.5% (max.)
Performance Fee 15% subject to High
Watermark
Hurdle Rate LIBOR (1M)
Redemption Fee 0% after 18 months
NAV Monthly (No lock-up)
Custodian HSBC
Administrator Apex fund services
Auditors Deloitte
Lawyers Appleby
Fund Manager TNI(Dubai)LTD
Domicile Bermuda
Reuters LP65135780
Bloomberg NIMESS BH
The National Investor
Headquarters
TNI Tower | Zayed 1st Street Khalidiya|
P.O. Box 47435 | Abu Dhabi | UAE
Phone: +971 2 619 2300
Fax: +971 2 619 2331
www.tni.ae
Since Inception %
TNI MENA SSF
6.9
MTD 0.0
YTD 3.1
Since Inception -35.4
*S&P Composite Large Mid-Caps comparison is used for illustrative purposes only as the MENA market is the Universe of the Fund.
RISK
RETU
RNH
IGH
MID
LOW
LOW MID HIGH
TNI SSFMSCI ARABIA
Fund Performance since Inception
Monthly Performance (%)
Fund Profile
40%
50%
60%
70%
80%
90%
100%
110%
120%
130%
Aug-08 May-09 Feb-10 Nov-10 Aug-11 May-12 Feb-13
TNI SSF S&P Composite
Cash 24 %
Iraq 12.7 %
KSA 21.9 %
Others 9.1 %
Kuwait 9.3 %
UAE 23 %
6.0%
6.7%
6.8%
9.3%
9.3%
ASTRA
Asiacell
SAMBA
DIB Sukuk 03/49
KIPCO Bond 10/16
TNI MENA SPECIAL SITUATIONS FUND Fact Sheet as of March 31, 2013
Fund Profile
Focus: Achieve absolute return by investing in special situations in the Middle East and North Africa (MENA) region, primarily focusing on corporate securities and instruments issued by regional firms.
Management Style: The allocation will be based on fundamental research and will incorporate a blend of top-down and a bottom-up analytical approach, with a focus on bottom-up approach. Portfolio construction will be diversified amongst asymmetric risk/reward investment ideas, with a major focus on capital preservation.
Objective: The Fund aims to generate long-term capital growth by investing primarily in special opportunities and situations in the Middle East and North Africa (MENA) region. Special situations/opportunities include investments in securities such as equities, convertibles, derivatives and debt instruments.
Suitability: Shares of the Fund are speculative and involve a high degree of risk. The Fund is therefore designed for sophisticated investors who are able to understand the risks involved in emerging markets’ securities investments, particularly in the MENA region.
Asset Allocation by Geography Top Holdings (ex. Money Market)
MTD 1.1
YTD 3.4
Since Inception 6.9
Fund Performance (%)
Fund Facts
S&P Composite Large Mid Cap (%)
%
Jan
Feb
Mar
Apr
May
June
July
Aug
Sept
Oct
Nov
Dec
YTD
2008 - - - - - - - - -0.2 -4.0 1.3 0.0 -2.9
2009 -1.0 -0.5 1.9 2.8 3.0 -0.3 3.7 1.8 5.0 1.5 -7.5 0.8 11.2
2010 1.1 1.6 3.7 1.7 -5.9 -1.1 2.1 -0.4 2.7 -1.5 -0.1 2.5 6.3
2011 -4.8 -2.4 -2.6 0.8 -1.9 -0.5 0.3 -0.7 -1.0 -0.9 -1.9 0.8 -14.0
2012 0.4 2.5 -0.0 0.1 -1.7 -0.6 2.9 1.3 0.4 0.5 -1.0 -0.2 4.7
2013 3.2 -0.8 1.1 3.4
Inception date Sept 01, 2008
Base Currency USD
Minimum Inv. USD 100,000
NAV / Unit USD 1068.84
Net Assets USD 7.9M
Initial Fee 3% (max.)
Management Fee 1.75%
Custody/Admin Fee 0.5% (max.)
Performance Fee 15% subject to High
Watermark
Hurdle Rate LIBOR (1M)
Redemption Fee 0% after 18 months
NAV Monthly (No lock-up)
Custodian HSBC
Administrator Apex fund services
Auditors Deloitte
Lawyers Appleby
Fund Manager TNI(Dubai)LTD
Domicile Bermuda
Reuters LP65135780
Bloomberg NIMESS BH
The National Investor
Headquarters
TNI Tower | Zayed 1st Street Khalidiya|
P.O. Box 47435 | Abu Dhabi | UAE
Phone: +971 2 619 2300
Fax: +971 2 619 2331
www.tni.ae
Since Inception %
TNI MENA SSF
6.9
MTD 0.0
YTD 3.1
Since Inception -35.4
*S&P Composite Large Mid-Caps comparison is used for illustrative purposes only as the MENA market is the Universe of the Fund.
RISK
RETU
RNH
IGH
MID
LOW
LOW MID HIGH
TNI SSFMSCI ARABIA
Fund Performance since Inception
Monthly Performance (%)
Fund Profile
40%
50%
60%
70%
80%
90%
100%
110%
120%
130%
Aug-08 May-09 Feb-10 Nov-10 Aug-11 May-12 Feb-13
TNI SSF S&P Composite
Cash 24 %
Iraq 12.7 %
KSA 21.9 %
Others 9.1 %
Kuwait 9.3 %
UAE 23 %
6.0%
6.7%
6.8%
9.3%
9.3%
ASTRA
Asiacell
SAMBA
DIB Sukuk 03/49
KIPCO Bond 10/16
TNI MENA SPECIAL SITUATIONS FUND Fact Sheet as of March 31, 2013
Fund Profile
Focus: Achieve absolute return by investing in special situations in the Middle East and North Africa (MENA) region, primarily focusing on corporate securities and instruments issued by regional firms.
Management Style: The allocation will be based on fundamental research and will incorporate a blend of top-down and a bottom-up analytical approach, with a focus on bottom-up approach. Portfolio construction will be diversified amongst asymmetric risk/reward investment ideas, with a major focus on capital preservation.
Objective: The Fund aims to generate long-term capital growth by investing primarily in special opportunities and situations in the Middle East and North Africa (MENA) region. Special situations/opportunities include investments in securities such as equities, convertibles, derivatives and debt instruments.
Suitability: Shares of the Fund are speculative and involve a high degree of risk. The Fund is therefore designed for sophisticated investors who are able to understand the risks involved in emerging markets’ securities investments, particularly in the MENA region.
Asset Allocation by Geography Top Holdings (ex. Money Market)
MTD 1.1
YTD 3.4
Since Inception 6.9
Fund Performance (%)
Fund Facts
S&P Composite Large Mid Cap (%)
%
Jan
Feb
Mar
Apr
May
June
July
Aug
Sept
Oct
Nov
Dec
YTD
2008 - - - - - - - - -0.2 -4.0 1.3 0.0 -2.9
2009 -1.0 -0.5 1.9 2.8 3.0 -0.3 3.7 1.8 5.0 1.5 -7.5 0.8 11.2
2010 1.1 1.6 3.7 1.7 -5.9 -1.1 2.1 -0.4 2.7 -1.5 -0.1 2.5 6.3
2011 -4.8 -2.4 -2.6 0.8 -1.9 -0.5 0.3 -0.7 -1.0 -0.9 -1.9 0.8 -14.0
2012 0.4 2.5 -0.0 0.1 -1.7 -0.6 2.9 1.3 0.4 0.5 -1.0 -0.2 4.7
2013 3.2 -0.8 1.1 3.4
Inception date Sept 01, 2008
Base Currency USD
Minimum Inv. USD 100,000
NAV / Unit USD 1068.84
Net Assets USD 7.9M
Initial Fee 3% (max.)
Management Fee 1.75%
Custody/Admin Fee 0.5% (max.)
Performance Fee 15% subject to High
Watermark
Hurdle Rate LIBOR (1M)
Redemption Fee 0% after 18 months
NAV Monthly (No lock-up)
Custodian HSBC
Administrator Apex fund services
Auditors Deloitte
Lawyers Appleby
Fund Manager TNI(Dubai)LTD
Domicile Bermuda
Reuters LP65135780
Bloomberg NIMESS BH
The National Investor
Headquarters
TNI Tower | Zayed 1st Street Khalidiya|
P.O. Box 47435 | Abu Dhabi | UAE
Phone: +971 2 619 2300
Fax: +971 2 619 2331
www.tni.ae
Since Inception %
TNI MENA SSF
6.9
MTD 0.0
YTD 3.1
Since Inception -35.4
*S&P Composite Large Mid-Caps comparison is used for illustrative purposes only as the MENA market is the Universe of the Fund.
RISK
RETU
RNH
IGH
MID
LOW
LOW MID HIGH
TNI SSFMSCI ARABIA
Fund Performance since Inception
Monthly Performance (%)
Fund Profile
8.1%
8.8%
8.9%
8.9%
9.5%
0.0% 2.0% 4.0% 6.0% 8.0% 10.0%
ENBD
NBAD
Emaar
FGB
Etisalat
`
48.2%
33.5%
7.8%
10.5%
Abu Dhabi
Dubai
DIFX
Cash
TNI UAE BLUE CHIP FUNDFact Sheet as of June 30, 2011
Fund Profile
Focus: Although the fund may participate in markets throughout the Gulf Cooperative
Countries (‘GCC’), its investments will be primarily focused on publicly traded equities of UAE
firms with large capitalization, which present a steady and recurrent track record of earnings
growth and have a potential for capital appreciation.
Management Style: The key investment criteria are the company’s financial strengths,
competitiveness, profitability, growth prospects and quality of management. The allocation
will be based on fundamental research and will incorporate a blend of top-down and a
bottom-up analytical approach.
Objective: The fund aims to provide long-term capital appreciation through investing in
equity securities publicly traded, primarily in the UAE, and, to a lesser extent, in other GCC
markets.
Suitability: Units of the Fund are speculative and involve a high degree of risk. The Fund is
therefore designed for sophisticated investors who are able to understand the risks involved
in emerging markets’ equity investments, particularly in the GCC equities.
Asset Allocation Top Holdings
Fund Performance since Inception
Fund Performance (%)
Monthly PerformanceWTD -0.9
MTD 0.9
YTD -1.3
Since Inception -61.3
Value Blend GrowthLarge
Medium
Small
Fund Profile
WTD -0.9
MTD 0.5
YTD -0.8
Since Inception -49.8
Fund Facts
Index comparison is used for illustrative purposes only.
% Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec YTD
2005 - - - - 2.7 6.9 -11.2 6.0 5.9 4.3 1.3 -4.1 12.2
2006 -5.4 -4.7 -3.4 -8.5 -5.7 -2.9 -2.4 5.2 2.2 -3.4 -8.4 0.3 -32.9
2007 -0.8 2.5 -5.1 3.7 18.8 -1.7 0.0 -3.8 1.6 18.9 4.4 9.1 54.9
2008 -3.7 7.2 -6.1 9.8 -0.5 -1.8 0.8 -15.0 -15.7 -22.4 -23.2 -12.1 -60.7
2009 -9.7 4.9 8.7 5.8 9.3 -1.8 5.0 4.2 13.2 -2.9 -4.8 -13.1 16.2
2010 -8.3 -3.4 16.7 -1.7 -9.1 -2.9 -1.8 -1.9 10.5 5.0 -4.0 -1.4 -5.1
2011 -0.9 -7.9 6.4 7.0 -5.1 0.5 -0.8
Inception Date May 01, 2005
Base Currency AED
Dealing Currencies AED - USD
Minimum Inv. AED 350,000
NAV / Unit AED 5.02
Net Assets AED 127.40m
Initial Fee 3% (max.)
Management Fee 1.5%
Custody/Admin Fee 0.45% (max.)
Performance Fee 10% subject to High Watermark
Hurdle Rate EIBOR (3M)
Redemption Fee 1% after 1 Year
NAV Weekly (No Lock-up)
Custodian Deutsche Bank
Administrator Deutsche Bank
Auditors KPMG
Lawyers Tamimi & Co
Fund Manager TNI
Domicile UAE
ListingDubai Financial Market –TNIUAEBCF
Reuters Lp65037579
Bloomberg TNIUAEF UH Since Inception %
TNI UAE Blue Chip Fund -49.8
S&P UAE Dom Capped -61.3
MSCI UAE Index -69.3
S&P UAE Dom Capped Index (%)
The National Investor
Headquarters
TNI Tower | Zayed 1st Street Khalidiya|
P.O. Box 47435 | Abu Dhabi | UAE
Phone: +971 2 619 2300
Fax: +971 2 619 2400
Email: [email protected]
www.tni.ae
0%
20%
40%
60%
80%
100%
120%
140%
160%
Apr-05 Apr-06 Apr-07 Apr-08 Apr-09 Apr-10 Apr-11
TNI BCF
MSCI UAE Index
S&P UAE Dom Capped Index
-10 0 10 20 30 40 50
Shorts
Sukuks
Bonds
Cash
Equities
-5 0 5 10 15 20 25
Telecoms
Others
Financials
Holding
Cash
TNI MENA SPECIAL SITUATIONS FUND Fact Analytics as of March 31, 2013
Asset allocation by Strategy Asset allocation by Sector
Statistics since Fund inception
TNI SSF S&P Composite LIBOR (1M)
Monthly. Return 1.05% -0.04% 0.02%
YTD 2013 3.42% 3.06% 0.05%
Since Inception 6.88% -35.41% 2.65%
Ann. Return Inception 1.46% -9.10% 0.57%
Volatility 8.11% 21.19% 0.22%
Sharpe Ratio 0.08 NA NA
Correl. (vs. TNI SSF) 1 0.28 0.21
Maximum Drawdown -7.52% -22.95% NA
# of Months 55 55 55
% Positive Month 52.73% 49.09% 100%
Best Month 5.00% 13.84% 0.34%
Worst Month -7.52% -22.95% 0.02%
Returns % TNI SSF S&P Composite
1M 1.05 -0.04
3M 3.42 3.06
6M 2.69 2.76
1Y 5.22 -6.40
Since Inception 6.88 -35.41
Returns % TNI SSF LIBOR (1M)
1M 1.05 0.02
3M 3.42 0.05
6M 2.69 0.10
1Y 5.22 0.22
Since Inception 6.88 2.65
-10 0 10 20 30 40 50
Shorts
Sukuks
Bonds
Cash
Equities
-5 0 5 10 15 20 25
Telecoms
Others
Financials
Holding
Cash
TNI MENA SPECIAL SITUATIONS FUND Fact Analytics as of March 31, 2013
Asset allocation by Strategy Asset allocation by Sector
Statistics since Fund inception
TNI SSF S&P Composite LIBOR (1M)
Monthly. Return 1.05% -0.04% 0.02%
YTD 2013 3.42% 3.06% 0.05%
Since Inception 6.88% -35.41% 2.65%
Ann. Return Inception 1.46% -9.10% 0.57%
Volatility 8.11% 21.19% 0.22%
Sharpe Ratio 0.08 NA NA
Correl. (vs. TNI SSF) 1 0.28 0.21
Maximum Drawdown -7.52% -22.95% NA
# of Months 55 55 55
% Positive Month 52.73% 49.09% 100%
Best Month 5.00% 13.84% 0.34%
Worst Month -7.52% -22.95% 0.02%
Returns % TNI SSF S&P Composite
1M 1.05 -0.04
3M 3.42 3.06
6M 2.69 2.76
1Y 5.22 -6.40
Since Inception 6.88 -35.41
Returns % TNI SSF LIBOR (1M)
1M 1.05 0.02
3M 3.42 0.05
6M 2.69 0.10
1Y 5.22 0.22
Since Inception 6.88 2.65
The National Investor
For More Information
+97126192300
www.tni.ae
8.1%
8.8%
8.9%
8.9%
9.5%
0.0% 2.0% 4.0% 6.0% 8.0% 10.0%
ENBD
NBAD
Emaar
FGB
Etisalat
`
48.2%
33.5%
7.8%
10.5%
Abu Dhabi
Dubai
DIFX
Cash
TNI UAE BLUE CHIP FUNDFact Sheet as of June 30, 2011
Fund Profile
Focus: Although the fund may participate in markets throughout the Gulf Cooperative
Countries (‘GCC’), its investments will be primarily focused on publicly traded equities of UAE
firms with large capitalization, which present a steady and recurrent track record of earnings
growth and have a potential for capital appreciation.
Management Style: The key investment criteria are the company’s financial strengths,
competitiveness, profitability, growth prospects and quality of management. The allocation
will be based on fundamental research and will incorporate a blend of top-down and a
bottom-up analytical approach.
Objective: The fund aims to provide long-term capital appreciation through investing in
equity securities publicly traded, primarily in the UAE, and, to a lesser extent, in other GCC
markets.
Suitability: Units of the Fund are speculative and involve a high degree of risk. The Fund is
therefore designed for sophisticated investors who are able to understand the risks involved
in emerging markets’ equity investments, particularly in the GCC equities.
Asset Allocation Top Holdings
Fund Performance since Inception
Fund Performance (%)
Monthly PerformanceWTD -0.9
MTD 0.9
YTD -1.3
Since Inception -61.3
Value Blend GrowthLarge
Medium
Small
Fund Profile
WTD -0.9
MTD 0.5
YTD -0.8
Since Inception -49.8
Fund Facts
Index comparison is used for illustrative purposes only.
% Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec YTD
2005 - - - - 2.7 6.9 -11.2 6.0 5.9 4.3 1.3 -4.1 12.2
2006 -5.4 -4.7 -3.4 -8.5 -5.7 -2.9 -2.4 5.2 2.2 -3.4 -8.4 0.3 -32.9
2007 -0.8 2.5 -5.1 3.7 18.8 -1.7 0.0 -3.8 1.6 18.9 4.4 9.1 54.9
2008 -3.7 7.2 -6.1 9.8 -0.5 -1.8 0.8 -15.0 -15.7 -22.4 -23.2 -12.1 -60.7
2009 -9.7 4.9 8.7 5.8 9.3 -1.8 5.0 4.2 13.2 -2.9 -4.8 -13.1 16.2
2010 -8.3 -3.4 16.7 -1.7 -9.1 -2.9 -1.8 -1.9 10.5 5.0 -4.0 -1.4 -5.1
2011 -0.9 -7.9 6.4 7.0 -5.1 0.5 -0.8
Inception Date May 01, 2005
Base Currency AED
Dealing Currencies AED - USD
Minimum Inv. AED 350,000
NAV / Unit AED 5.02
Net Assets AED 127.40m
Initial Fee 3% (max.)
Management Fee 1.5%
Custody/Admin Fee 0.45% (max.)
Performance Fee 10% subject to High Watermark
Hurdle Rate EIBOR (3M)
Redemption Fee 1% after 1 Year
NAV Weekly (No Lock-up)
Custodian Deutsche Bank
Administrator Deutsche Bank
Auditors KPMG
Lawyers Tamimi & Co
Fund Manager TNI
Domicile UAE
ListingDubai Financial Market –TNIUAEBCF
Reuters Lp65037579
Bloomberg TNIUAEF UH Since Inception %
TNI UAE Blue Chip Fund -49.8
S&P UAE Dom Capped -61.3
MSCI UAE Index -69.3
S&P UAE Dom Capped Index (%)
The National Investor
Headquarters
TNI Tower | Zayed 1st Street Khalidiya|
P.O. Box 47435 | Abu Dhabi | UAE
Phone: +971 2 619 2300
Fax: +971 2 619 2400
Email: [email protected]
www.tni.ae
0%
20%
40%
60%
80%
100%
120%
140%
160%
Apr-05 Apr-06 Apr-07 Apr-08 Apr-09 Apr-10 Apr-11
TNI BCF
MSCI UAE Index
S&P UAE Dom Capped Index
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