Osool to manage Bahrain’s SIO’s financial assets

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Osool was incorporated pursuant to Law No. 3 of 2008, which stipulates the establishment of a company to manage assets transferred to it by the SIO, with the management process involving strategies and decisions to develop and invest the funds of the Pension Fund Commission and the General Organization for Social Insurance, which were merged to form the SIO.

Osool was planned and founded after an intensive study concluded that it is possible to improve the existing pension asset management practices through the creation of an independent entity to ensure the implementation and constant development of best, world-class practice, to secure the future of pensioners in the concerned sectors, including the private, public, and military sectors. The company is regulated by the Central Bank of Bahrain and the ministry of industry and commerce.

Osool chairman Rashid Al Meer said: “The Osool board is constantly working to achieve the best possible results that serve all funds under the company’s management. The board and its various committees held 29 meetings in 2012, in which administrative, financial, technical, investment, risk management, and internal audit regulations were passed. An investment strategy for the three pension funds were placed based on their financial positions that was advised on by AON Hewitt.

Investment diversification

Osool CEO Sheikh Abdullah bin Khalifa Al Khalifa said that the company will pursue an investment strategy based on the diversification of investments across an extensive portfolio in line with the laws of Bahrain’s central bank, with a view towards minimising risk and generating stable annual returns. He said the company aims to achieve an annual return in line with the requirements of the actuarial rate and will try to improve it. This will cover the funds’ expected annual needs, he said.

He explained that this objective will be achieved through a balanced investment portfolio that turns low-return investments into investments that meet the needs of the fund. He noted that much of the funds’ money is currently deposited in bank accounts that generate minimal profit, and said the aim will now be to upgrade the performance of this investment by diversifying to several projects with higher returns while always considering potential risks. The aim of this strategy, he said, is to create balance between the company’s responsibility toward the local economy and its responsibility for achieving financial security for those insured.

Efficient systems

The CEO said Osool has set up governance and investment systems and mechanisms on par with those used in the most efficient investment companies in the world. The company has also recruited the best talent with extensive work experience in major banks and investment companies.

SIO CEO Zakariya Al Abbasi said Osool’s launch is part of SIO’s objectives and efforts to develop social insurance benefits and services and enhance their sustainability. The company has a qualified team capable of making the right investment choice that fits with the company’s objectives, as well as close relations with organisations specialising in all aspects of asset management, which in turn makes Osool a fully-fledged asset management company, he added.

Al Abbasi said SIO, as Osool’s owner, will closely watch the company’s performance through its presence on the board. He said SIO will follow up and monitor all the company’s operations and investments to make sure they move on the right track, realise the objectives for which the company was established and preserve the wealth of the coming generations. He promised a high level of transparency and said that SIO’s board, in which all labour sectors, employees, and business owners in the public and private sectors are equally represented, will be fully informed of Osool’s performance, as the company will present its financial results to the board. He said the aim is to make sure that Osool’s performance and results will improve on the current situation so that the financial position of the pension funds will be improved.

Brigadier Khalid Mohammed Al Mannai, general manager of the Military Pension Fund, said: “The success of pension funds is basically linked to the success of their investment policies, their competence in managing deposits, and their ability to fulfill long-term obligations so that the insured and their families can feel safe after retirement. Assigning this vital mission to a specialised company like Osool is a cause for optimism.”

Source: BNA

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