The Ministry of Human Resources and Emiratisation (MOHRE) has officially approved First Abu Dhabi Bank (FAB) as a new provider for the alternative End-of-Service Benefits (EOSB) Savings scheme based on MOHRE's website listing sited on 17 October 2024. This approval marks FAB as the fourth approved provider since the scheme’s introduction vide Cabinet Resolution 96/2023 less than a year ago, and notably the first banking group to join the panel of approved providers.
According to information published on MOHRE’s website, FAB’s EOSB Savings plan will be managed by FAB Asset Management Division boasting over two decades of regional expertise and managing approximately USD 5 billion in assets as of October 2024. FAB Asset Management reportedly caters to a diverse clientele, including sovereign wealth funds, pension funds, foundations, financial institutions, family offices, as well as individual investors.
At present, the custodian, scheme administrator and IT provider for FAB’s EOSB Savings plan have not been disclosed.
In terms of EOSB funds, the new provider has announced two capital protection options for now: the FAB End of Service Benefit Fund with Capital Protection and the FAB Islamic End of Service Benefit Fund with Capital Protection. According to information available on Bloomberg, these funds will primarily invest in money market instruments, including fixed income securities, commercial paper, treasury bills, deposits, and Islamic commercial paper, which will require approval from the internal Shari'ah Supervision Committee in the case of the Shari’ah compliant fund. It is important to note that these two funds are currently awaiting approval from the Securities and Commodities Authority (SCA).
The FAB EOSB Savings plan brochure is available for download below. Further details on the asset allocation, expected yield, average maturity, capital protection mechanism and fees will be disclosed in an upcoming article.
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