Syariah products slowly growing popular

Dr Mark Mobius, executive chairman of Templeton Emerging Markets Group

SINGAPORE - Investment products that adhere to syariah or Islamic principles are slowly growing in popularity in Singapore.

Franklin Templeton has launched another three syariah-compliant funds, as the asset manager recognises the growth of Islamic finance.

The three funds are the Franklin Templeton Global Sukuk Fund, Templeton Shariah Global Equity Fund and Templeton Shariah Asian Growth Fund, and will be made available to retail investors.

A syariah-compliant product is one that operates in accordance with the religious beliefs of Islam. For example, syariah-compliant funds are not allowed to invest in businesses associated with activities barred by Islam, such as gambling or alcohol.

Conventional financial services are also excluded as they go against the religion's ban on interest.

To ensure compliance with syariah guidelines, Franklin Templeton scrutinises the business activities of every company that it picks at a granular level, and the three new funds have been independently reviewed and endorsed by the Amanie International Shariah Supervisory Board.

The Global Sukuk Fund focuses on fixed and floating rate syariah-compliant securities issued by government, government-related entities and corporates. Sukuk means Islamic bond.

For those who prefer equity investments, the Templeton Shariah Global Equity Fund will invest in the most undervalued opportunities globally.

The Templeton Shariah Asian Growth Fund will invest primarily in syariah-compliant equity and equity-related securities listed in the Asia region, excluding Australia, New Zealand and Japan.

Dr Mark Mobius, executive chairman of Templeton Emerging Markets Group, who will manage the Templeton Shariah Asian Growth Fund, said: "Syariah-compliant strategies are an important and growing market in many parts of the developing world, and Templeton is pleased to bring its emerging markets expertise to bear on this new offering for syariah investors globally."

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