The funds will invest in companies that operate according to Jewish law.
Israel Discount Bank (TASE: DSCT) subsidiary Mercantile Discount Bank is set to launch "kosher" mutual funds which will invest in companies that operate according to Jewish law (Halacha). The fund's halachic arbitrator will be Rabbi Arieh Dvir, who heads an institute specializing in economic research and halacha. Mercantile Discount CEO Jacob Tenenbaum confirmed the report and said that the move represented part of the bank's strategy of becoming the leading banking institution in the haredi (ultra orthodox) sector.
Mercantile Discount currently manages funds worth a total of NIS 439 million. As a small bank, it is entitled, under the provisions of the Bachar capital market reform, to retain ownership of its funds through 2014 and it will not have to sell them like the other bans. "We prefer to grow and develop the funds, rather than selling them," said Tenenbaum. At present, Hilat Shoham is the only investment house operating in accordance with halachic law. The company, which is managed by Jacob Moreshet, currently contracts out the management of its funds to B. Gaon Holdings Ltd. (TASE: GAON) and is also set to manage funds through DS Securities & Investments ltd. (TASE:DSIN).
Mercantile Discount views the haredi sector as a strategic growth target, a policy that is in line with its parent's overall strategy of turning Mercantile into a niche specialist.
Published by Globes [online], Israel business news - www.globes.co.il - on July 17, 2007
© Copyright of Globes Publisher Itonut (1983) Ltd. 2007