On 30 October 2025, National Bonds announced the official launch its first EOSB Sub-Fund, the Capital-Protected Shariah-Compliant Fund, following the release of the updated Master Prospectus of its End-of-Service Benefits (EOSB) Umbrella Fund and the “Supplement” for this Sub-Fund.

This is the first time that detailed documentation about an EOSB Fund under the UAE EOSB Savings Scheme has been published and shared in the public domain.

Both documents were reportedly approved by the Securities and Commodities Authority (SCA) on 8 October 2024 and contain important information about how approved EOSB Fund Managers like National Bonds will manage subscriptions, contributions, investments, fees and redemptions under the scheme.

According to the published documents, the initial subscription of this Sub-Fund will open at a nominal price of AED 1.00 per unit for mandatory Employer Contributions, after which new units will be priced based on the weekly Net Asset Value (NAV). The published materials, however, do not specify the precise opening date and duration of the initial subscription window.

In this article, we list out the key points to note from both documents since the last release in August 2025.

What’s new in the Master Prospectus

The main update is that the fund’s administration and registrar duties will now be handled by Apex Fund Services Ltd., Abu Dhabi.

Key points from the Supplement

The Supplement of the Capital Protected Shariah Compliant Fund offers, for the first time, a detailed breakdown of the fund’s costs and operating expenses and provides more clarity on redemption procedures and frequency of NAV calculations.

Breakdown of fees for the Capital Protected Shariah Compliant Fund

• Management fee: 0.75% per annum of Assets under Management (AUM) calculated weekly is payable to National Bonds, as the Fund Manager. National Bonds also reserves the right to defer or reduce its management fee during periods when the fund’s NAV risks dropping below AED 1.00, or to apply a temporary charge (up to 1% per year) to offset operating costs during periods of negative returns.
• Operating expenses: The Sub-Fund shall bear all expenses incidental to its operations and business, including but not limited to the following:
  • Transactional costs: Such as brokerage, banking, sales and purchase commissions, etc.
  • Custody Fees: 0.035% per annum and scheme administration oversight fees at 0.025%, payable to Standard Chartered Bank, subject to a minimum annual fee of USD 45,000.
  • Fund Administration Fees: 0.38% of NAV per annum will be payable to Apex. This is a substantial portion, exactly half of the fund’s management fee. This suggests that the fee likely covers more than just classic fund administration and may likely also include technology-related and possibly scheme administration costs. Based on information available on National Bonds’ website, the technology platform supporting the scheme’s administration is powered by Aurem.
  • Audit and Shariah supervision: Annual auditor fee is AED 95,000, while Shariah advisory fees may reach AED 100,000 per year.
  • Legal expenses: Such as the fund registration, organizing meetings of Unitholders, fees of legal advisers, costs of winding down and liquidating the Sub-Fund, etc. at actuals.
• There are no performance fee, subscription fee or redemption fee for Units of this Sub-Fund.

If we separate the above costs into variable (linked to the fund’s AUM) and fixed (such as auditor, Shariah advisor, and custodian minimums), the total annual charges for the Capital Protected Shariah-Compliant Fund is estimated to fall between 1.2% and 1.4% of AUM.

As with most pooled funds, the effective cost will decrease as the fund grows in size, since many of these operational expenses are fixed. At lower AUM levels, however, these fixed costs weigh more heavily on total expenses, pushing the effective rate toward the higher end of the range.

Please also note that all the above fees are exclusive of Value Added Tax (VAT) at 5.0%.

Redemption process: More clarity for employers and employees

• Share Class A and B: is for Mandatory Employer Contributions for skilled and unskilled workers, respectively. Therefore, only Employers can subscribe or redeem these units. Redemption is subject to clearance from the Employer and upon the end of employment, these units will be redeemed and converted into Class C units if the employee wishes to keep their savings invested in the same Sub-Fund.
• Share Class C: is for Voluntary Contributions from either Employers or Employees, provided that the Employee is already subscribed under Class A or B. Share Class C has no restrictions on redemptions.

In other words, Employers have control over all mandatory contributions, while Employees have optional flexibility through Class C.

Frequency of NAV calculation

NAV calculations for this Sub-Fund will be weekly, calculated every Tuesday, or the next working day if Tuesday is a holiday. Subscriptions and redemptions will also follow this weekly schedule.

Our thoughts

With the recent release of the Sub-Fund Supplement, National Bonds remains the first approved EOSB Fund Manager to publicly share detailed documentation of its EOSB offering. This disclosure has provided much needed insight into how the UAE EOSB Savings Scheme will operate.

Of immediate importance is the level of approved charges, as this will directly impact the net performance of the Sub-Fund, i.e., the growth potential for employee savings. Based on the fees disclosed, charges for the Capital Protected Shariah Compliant Sub-Fund will likely range between 1.20%-1.40% of AUM, relatively consistent with charges of low risk funds such as the Mercer Cash Fund offered under DEWS, for example.

Returns, of course, depend on market conditions and the overall performance of the Sub-Fund’s investments. In a recent interview with the Labour Market magazine, Mohammad Qasim Al Ali, Group CEO of National Bonds indicated that returns for this Sub-Fund, are expected to range between 2% and 4% per year before fees, suggesting that employees could see modest, stable growth on their EOSB savings over the long term.

He also revealed that National Bonds has plans to expand its EOSB product range, whether by diversifying investment funds, or launching additional innovative financial tools to meet the needs of a wider segment of employees.

We at Pensions Monitor applaud the transparency shown by National Bonds and look forward to similar disclosures by other market participants in due course. Sign up for our free newsletter to receive all the latest updates on EOSB in the UAE.