Ofek and Credit Suisse have signed a cooperation agreement whereby they will offer shekel-based, Israeli-registered mutual funds that will be invested globally by Credit Suisse Asset Management. Ofek, established in 1963, handles assets totalling US$1.5 bn for more than 4,000 customers. Although Credit Suisse does not have a local presence in Israel, Ofek's chief executive officer Niza Rousso-Shtauber said that if this joint venture is successful, it is likely that Credit Suisse would look to expand its products and involvement in Israel.

Ms Rousso-Shtauber said the deal 'would allow Israelis to invest abroad easily, without having to worry about converting shekels or dealing with tax aspects.' The first fund will closely resemble the Morgan Stanley Capital International World Index. Future funds will be more focused on specific sectors but not overly specialized, according to Ms Rousso-Shtauber.

Although she could not estimate the potential or interest in the first fund, which the firms hope to offer to by mid-January 2001, Ms Rousso-Shtauber stressed the need for Israeli investors to diversify their holdings beyond the relatively small Israeli market: 'Investing part of one's assets outside the local market is known and common in most countries in the world, and this also applies to the Israeli investor,' she said. She added that individual investors and small to medium institutional investors would be the most likely to invest in the funds.