Ex-Barclays Team Plans London-Based Islamic Asset Firm

A group of former Barclays executives are launching a London-based asset management firm that combines socially responsible and Islamic investment principles, seeking to build crossover appeal among both investor segments.

The firm, named Arabesque, is due to open to investors in the first quarter of 2014 with a team led by 20-year veteran Omar Selim, Barclays’ former head of global markets for institutional clients in Europe, the Middle East, Africa and eastern Europe.

It will focus on value-based investment strategies, which buy shares deemed to be trading at a discount to their fundamental worth. Its methodology will use environmental, social and corporate governance (ESG) criteria.

“Implementing ESG is not meant to patronise anyone, quite the contrary – it is for performance, and extensive academic research supports this,” said the Egyptian-born Selim.

“Our objective is to make sustainable investment attractive and available to all investors regardless of the economic and cultural background.”

The firm is applying for authorisation and regulation by Britain’s Financial Conduct Authority; it is establishing funds in Luxembourg and the Cayman Islands and plans to offer managed accounts as well.

“We will start with three globally diversified equity funds and later expand to other asset classes such as fixed income and real estate,” said Andreas Feiner, former head of distribution for Barclays Saudi Arabia.

An office in Frankfurt will handle research, advisory activities and distribution while the firm plans to open an office in the Gulf for additional research and client coverage.

The team includes Dominic Selwood, previously global head of Islamic products at Barclays, as well as Alexander Kuppler, former head of trading at DWS Investments, Deutsche Bank’s retail fund management arm, and Tarek Selim, who headed the structured solutions team in Germany and Austria for UBS. The firm aims to add a head of quantitative research.

Arabesque will follow rules set by the Bahrain-based Accounting and Auditing Organisation for Islamic Financial Institutions as well as United Nations principles for responsible investment, Selim said.