Barclays Capital is currently gearing up to launch an Islamic structured note programme in the near future with a focus on growing its liquidity management and risk management businesses as the Islamic bond market continues to struggle amid global economic worries.
A Barclays Capital spokesperson declined to comment further but confirmed recent comments from its head of Islamic products, Dominic Selwood, to Reuters.
According to Selwood, the eurozone debt crisis and a lacklustre economic outlook in the United States have created more risk aversion among clients, creating opportunities to expand liquidity and risk management offerings: "In this year and the coming 12 months, I think it's about shining torches on places where people haven't been looking but are truly critical, like liquidity management, risk management, like the hedging products," he said.
Selwood said Barclays will launch an Islamic structured notes programme in the near future although no exact time frame for the offering has been set up.
"It will be a significant milestone for Barclays," he said. "It's been a while since the market has had a structured note programme. It will be more up-to-date in terms of shariah aims and shariha technology."
Selwood said sukuk pricing remained difficult in the current environment, causing many potential issuers to sit on the sidelines until there is more clarity or more benchmark issues come to market. He added that the market was unlikely to recover this year.
Selwood joined Barclays Capital in February, after Barclays' former head of global Islamic finance operations, Harris Irfan, stepped down in January.
Barclays obtained a licence to open an official Islamic branch at the Dubai International Financial Centre in September, allowing the bank to handle regional Islamic business from Dubai.