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News Article

15 May 2008

ADCB launches MSCI Arabian Markets Index Fund

Abu Dhabi, 15 May 2008: As part of their ongoing endeavors to deliver innovative investment solutions, Abu Dhabi Commercial Bank today announced the launch of the ADCB MSCI Arabian Markets Index Fund, a first-of-its-kind fund designed to track the performance of a diversified basket of Arabian market stocks.

"As the regional GCC equity and capital markets continue to grow, so too has the demand for more diverse and innovative solutions to meet the growing sophistication of investors. With this in mind, Abu Dhabi Commercial Bank is leading the way on a wide range of funds initiatives in the UAE and the broader region" said Ahmed Barakat, Head of Wealth Management Group at ADCB. "A particular success for the bank is its mutual funds range whose increased appeal can be attributed to easy access to any market. Today as individuals become more affluent, professionally run products are central to preserving wealth and to growing it over time. Mutual funds offer that option while being cost effective, transparent, and regulated by renowned agencies".

“The ADCB MSCI Arabian Markets Index Fund provides an ideal entry point for investors seeking efficient, low cost, passive exposure to one of the most dynamic investment destinations in the world”, said Mark Friedenthal, Fund Manager, ADCB. “With an increasing level of sophistication and participation in middle eastern financial markets, active managers are finding it more and more difficult to generate outperformance as these markets become more efficient. This is where the benefits of passive management become obvious as a low cost source of ‘beta’ or vanilla market exposure. The Fund will track the MSCI Arabian Markets index which is a multi-country equity benchmark covering the UAE, Saudi Arabia, Oman, Qatar, Bahrain, Kuwait, Egypt, Morocco and Jordon. Quantitative optimization techniques designed to minimize tracking error and trading costs and maximize liquidity will be employed in the management of the Fund.”

The Fund, which is sponsored and managed by ADCB, commenced trading on 15 January 2008 at a price of USD 10, with ongoing subscriptions and redemptions on a daily basis at the prevailing NAV. The minimum amount of investment that can be made by an investor in the Fund is USD 25,000. There is no lock-in period for investments in the Fund.

“We are delighted to have licensed Abu Dhabi Commercial Bank for the creation of a passive fund on the MSCI Arabian Markets Index,” said Jim Leggate, Executive Director and Head of MSCI Barra's Middle East Business based in Dubai. "This is the second index we have licensed to ADCB as the basis for a fund, reflecting the continued growth of MSCI Barra’s business in the Middle East region,” he added.

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