KUWAIT -- As many as 680 Islamic funds, 45 percent of which are concentrating in the GCC member states, are running assets in the neighborhood of USD 70 billion, according to a recent economic report.

There are 306 Islamic funds in the GCC member states alone, witnessing fast-track growth as a result of increasing wealth in the Arabian Gulf region thanks to edging oil prices, indicated the monthly report released by Kuwait-based Saba'ek Company.

There is a steady link between oil prices and the number of recently launched investment funds, which reflects the flow of capital into this industry, the report showed.

The size of GCC Islamic funds' investable assets edged up from USD 267 billion in 2007 to USD 736 billion in 2008, it cited the Ernst and Young as saying.

The base of Islamic funds' customers has largely expanded over the last decade to cover a large number of non-Muslim investors, the report indicated.

Such funds have developed in the field of wealth management in order to answer the needs of investors who are willing to join capital markets in line with Islamic Sharia' or law, it said, expecting the number of Islamic funds to skyrocket by over 700 this year.

Malaysia and Saudi Arabia are home to the largest number of Islamic funds thanks to their available incentives and deregulated Islamic finance, it said.

Malaysia has 194 Islamic funds, making up 26 percent of the total and running over USD 8.6 billion, while Saudi Arabia includes 147 funds, accounting for 19.6 percent and running USD 18 billion, it showed.

There are 55 funds running USD 5.5 billion in assets in the United Arab Emirates (UAE), followed by Kuwait which is home to 36 funds managing USD three billion, and then Bahrain with 20 funds investing less nearly USD one billion.

Such funds' revenues surged up by 16 percent last year, recording a strong jump compared to negative earnings in 2008 by 10 percent, the report added.

© KUNA (Kuwait News Agency) 2010