By Bernardo Vizcaino
June 25 (Reuters) - Madrid-based Allfunds Bank will expand its presence in Asia and the Middle East, widening the reach of its intermediation platform while adding more Islamic mutual funds to its product range, a company official said.
Allfunds, equally-owned by Banco Santander and Intesa Sanpaolo, plans to open an office in Singapore while growing business in countries such as Saudi Arabia, the Gulf region's largest mutual fund market.
Its Middle East business has $3.3 billion in assets under intermediation with 10 percent coming from Islamic funds, said regional manager David Pérez de Albeniz, who has been tasked with the firm's expansion in Asia.
Allfunds Middle East business has grown at an annual rate of 40 percent since 2009, the bulk coming from the United Arab Emirates, but the firm hopes to widen its geographical mix.
"We are continuously engaging with new fund managers in the region, the next ones featured will be (Islamic funds) coming from Saudi Arabia and Qatar."
Allfunds has hired Yunus Selant, previously with Skandia International, to replace Pérez de Albeniz who will relocate to Singapore.
In Asia the firm will initially focus on Singapore, with medium term plans to add markets including Hong Kong, Taiwan, Malaysia and Indonesia, where Islamic funds would also feature.
"The need for Islamic funds in that part of the world could be even greater," said Pérez de Albeniz.
Islamic fund managers screen their portfolios according to religious guidelines such as bans on tobacco, alcohol and gambling, in much the same way as socially responsible funds.
But unlike their ethical counterparts in Western markets, they still struggle with a lack of scale, partly due to the limited number of distribution channels available to them.
Created in 2000, Allfunds has more than $170 billion in assets under administration with funds from 450 fund managers. (Editing by Jacqueline Wong)