Q. Would you like to introduce yourself to Urdu Times readers?
I was born in Uttar Pardesh (UP), India. When i was six years old my family moved to Canada where we grew up in Barrie Ontario, a small town in 1975. In mid 80's we moved to Toronto as my father had the desire to start a Halal fried chicken store. I think we were one of the early ones, even prior to Popeyes coming to Canada, to have started the Halal chicken store.
I studied economic and political science from University of Toronto. I started my finance career at CIBC Wood Gundy. In 1998 I moved over to Nova Bankcorp group. That's where I launched the first Islamic fund, which was in those days called the Navigator SAMI fund, later known as Strategic Nova SAMI. SEMI fund was sold to Dynamic mutual funds back in 2002. In 2003，I started this company, FrontierAlt Capital Corporation.
Q. Why did you choose finance?
I always had interest in capital markets and economics and I have a lot of interest in human behavior. When there is movement in the market, it is really the human behavior that's doing it. I wasn't the type of person that could sit behind the desk. Financial services offered the opportunity to excel. There is no limitation and at the same time you are connected to the world. I started FrontierAlt to do corporate finance and investment banking. My vision was to get involved in Islamic finance in Canada.
Q. how did this idea come to you of starting Islamic financing.
Back in 96/97，I was part of a committee to study Islamic banking viability in Canada that presented a white-paper to the ministry of Ottawa. From that, I decided that there was some thing more to it. There was a demand in the Muslim community for the Shari'a compliant financial products. Certainly, I felt that I was in a position to do something and take on a challenge.
We wanted to bring professionalism around Islamic financing. Doing it in a way, where we have a prospectus offer that's available on a professional basis and is regulated, we are trying to bring credibility to the product. It's certainly very expensive to do. But we are hoping that Muslim community will see that there is viability to this and start considering the fund and Islamic products as the way of the future.
Q. When was the FrontierAlt Oasis (the Shari'a compliant fund) launched?
We started to work on the FrontierAlt Oasis fund in 2006 and because when you are filing for prospectus, you have to get clearance from all the major securities commissions across the country. Ontario wasn't that challenging but when you start to go to Western provinces and get the regulators to understand what Shari'a means and what Shari'a scholar means and getting them to have comfort with certain Islamic terminology was challenging and it took a long time to get clearance. By the time we really got going, it was early part of 2007.
Q. What does it mean for an investment fund to be Shari'a compliant? What should a Muslim understand when it is said that a fund is Shari'a compliant?
Shari’a, when you look at that term it means 'the way of doing something'. And for a Muslim, it is the way of having Halal in your life. What does it mean by Shari'a compliance in financial markets? There are certain rules and regulations that have been put together by Shari'a scholars or Fiqh scholars. They have come up with certain parameters or benchmarks dealing with finance. For example, Islamic funds are not allowed to invest in the companies that are involved in getting their income from alcohol, pork related food distribution, manufacturing of arms, entertainment, hotel chains and financial services such as banks, insurance or credit cards. Then you look at what kind of income is coming in. If a lot of the income is coming in through interest in a business, you want to avoid investing in such company. So, you have your primary and secondary screening. Primary screening is to avoid certain industries and then you have your secondary financial screening.
Q. These rules and regulations are great that have been put together by the scholars. But is there an oversight in terms of whether FrontierAlt Oasis fund is adhering to the rules?
That's a good question. Offering a fund through a prospectus puts a lot of onus on the company. Every thing that's in the prospectus in terms of rules that we have to follow to invest the investor's money is watched very closely by the regulators. When we do our annual filings, regulators come to our offices and look at our portfolio to see if it's being managed properly.
We have partnered with Dow Jones Islamic market index and we use the Dow Jones global index (Canada index). These are several hundred pre screened stocks. When you put the portfolio manager in that box then he's actively managing these pre screened companies. As an overlay strategy, we have Shari'a advisers from Dow Jones that work with us to make sure that portfolio is being managed according to the rules and there is no non-screened or non-Shari'a compliant company that comes into that portfolio. Our holdings are checked by Dow Jones as well because Dow Jones being a global index provider wants to make sure that we are adhering to the index.
At the same time, portfolio managers have their own responsibility to make sure that they are staying within the mandate. Our chief investment officer, Mr. Shah, has experience running close to a billion dollar portfolio in the Gulf and that experience counts for something. There are number of systems and checks to make sure that we don't go outside the defined parameters.
Q. How big is the FrontierAlt Oasis fund at this point?
At this point, it's roughly about 5 Million dollars of portfolio. One of the things that we are trying to do is increase the assets and the performance. Canada fund performance is stellar and in fact we are getting interest from non-Islamic community. In order for this fund to be successful, certainly the Muslim community is there but we would like to market it across the board and market the track record of the fund across the mainstream.
Q. This is the Oasis fund. What are the total assets of the FrontierAlt?
At last check, we were at 243 million dollars in assets. We also have conventional funds. We do a lot of work in corporate finance and investment banking and M&A. As a result of our partnership in the GCC (in the Gulf region), FrontierAlt is seen as a conduit for opportunities in the Gulf region. We have a lot of companies that come to us that would like to raise financing for themselves for primarily oil, gas and mining and we are introducing them to the major institutions in the Gulf. Having ONIC out of Oman as a strategic partner has been a big win for us. With ONIC, the gateway is opened for us for whole Dubai region.
Q. Would you say that ONIC is the largest investor in Frontier Alt?
Yes, ONIC is the largest investor and ONIC itself is a big financial holding company. Their owners and their partners are some of the biggest in the world. So for a small company in Canada, FrontierAlt, we have a global web through ONIC.
Q. For a common person in the Canadian Muslim community what kind of financial services do you offer?
For an individual in the Muslim community we offer the mutual funds. We are also working on number of other initiatives. We are talking to several partners to be able to offer Islamic insurance and Islamic mortgage. We are looking into building Sukuks. Sukuks are generally for the high net worth investors. In the Muslim community there are a lot of wealthy investors who want fixed income to protect their assets and want an Islamic way of doing that.
Q. If someone wanted to invest in Oasis funds, how would they go about doing it? 
One way is that they can contact us, email us or call us, we can help them facilitate that. If they have a financial planner or financial adviser, they can call them. We should be on the platform of the company that is in the service of providing financial advice. Their adviser can contact us and we can make sure that the fund is available on their platform.
Q. In terms of investing in the Oasis funds, could people in Canada purchase the fund for their registered retirement savings plan (RRSP)?
These are RRSP eligible. So if people have their RRSP account and they want to make a contribution to their RRSP account and want to buy the fund, that's not a problem. People who deal with financial adviser at the bank branch level, generally, only have available to them what the bank has to offer but if they are insistent enough, the adviser at the bank will find a solution. They can tell the bank that this is what I want and if you don't have it available, I'll go some where else.
Q. Which bank or which financial company a consumer could go to within Canada to invest in Oasis fund.
All major banks. Many people deal with financial planers who only deal with mutual funds. If people hear from their advisers that they don’t deal with FrontierAlt Oasis funds, then consumer can just call us and we will make sure that it's available. And lot of the time, we get calls from financial advisers saying that how come it's not available in my shop. So, we make sure that happens.
Q. On the financing side, if a company comes to you looking for financing how would that be Shari'a compliant?
One of the things that we offer to the Muslim community is that business owners can come to us and if they have a strong viable business that is growing business, we can help them with their financing. If it is a private company and they want to do a public offering, we can certainly look at those things. If they want to stay Shari'a compliant company, we can help them find Shari'a compliant solutions to grow their business.
With the Sukuk, If it's a company that has strong revenue stream, we can find them a partner. Sukuk is a good alternative to going to the bank and getting a loan or a line of credit. You can have a partner who comes in and does the profit sharing.
Q. What kind of companies or what level of business could contact you to get financing?
We look for companies that are mature and have at least a minimum of 3 to 5 years business experience. Have a positive growth potential. The economic value of their business should be at least 5 million dollars at a minimum for us to go and raise money for them. Any smaller than that is very challenging. It’s tough to come up with financing of 1 to 2 million dollars unless it’s in the business of oil, gas and mining. But any other business outside of resource section, their need should be at least a minimum of 5 to 10 million dollars.
Q. What is your advice to young Muslims about getting in to financial business?
We are starting to see more and more young Muslims coming on the Bay Street in investment and finance industry. Generally, they should study anything related to the securities and take securities course. They should be looking and adapting the CFA (Certified Financial Analyst) program. Those are good programs to get into the industry. When they are doing a job search, they should look at brokerage houses. These are great places to start a business because you learn a lot and lot about the markets environment. I think the most important experience that you can get in this is how the capital markets function.
The difference we find in the Muslim community is that we have to move away from the notion that I want to be a worker and work for somebody. We have to get into the mind set that I am going to build; I am going to do it. If someone’s going to build it then it might as well be me. You have to be prepared to take the risk. So you can lose everything or you can win a lot. No one’s going to fault you for saying you tried and it didn’t work out. I think we have to get away from the complex. A lot of things can go wrong that are beyond your control. But you wouldn't know until you try.
Q. Would you say that financial business is more difficult and there are more risks than other business, let's say running a fried chicken place?
I think the capital markets business is certainly more challenging because you are heavily regulated for one thing. At the same time, this is the business that Muslim community in Canada didn't grow up with. How many people from India, Pakistan or elsewhere come here and say that I was financial adviser back home and that's what I am going to do here. I was an investment banker there and that's what I am doing here.
Yes, it is tougher to get into financial industry and when you look around, ethnic community on Bay Street is still a minority. But you can't let that limit you. I am not naive to think that biases are not there. Certainly they are there. But if you don't break down the barriers, barriers will always be there. I have Islamic fund but I do traditional business too. I am involved in the capital markets so I am accepted on the Bay Street. We are educating Bay Street about Islamic financial products. So hopefully, we are opening the doors for people who can use us as an example. The success rate is not that high in first few years. You are poised to fail and you just have to fight that.
Q. Any message that you would like to convey to the community through Urdu Times?
We would love to get support from community and from the readers to pass the word on. Word of mouth is the best thing for us. We are a small company, we don't have the resources and the funds of the banks out there so we definitely need community support in promoting our financial products. We want to hear from them. There is an opportunity for us to go meet them and do seminars. In fact, we are trying to reach out to the Masjids in Canada. A lot of Masjids have their money in the banks sitting in cash accounts and we can professionally manage their money. We are just as protected as Banks and at the same time Masjids are able to get spare returns on the money that they have. And we understand what the requirements are.
Q. Can people who want to get in touch with you just call you or e-mail you?
Absolutely, one of the best ways to get a hold of me is through e-mail. It's always accessible as during traveling I have my Black Berry with me.
