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Saturday, 7 May 2016

Islamic Development Bank to return to ringgit sukuk market

SARAJEVO May 5 The Islamic Development Bank (IDB) plans to sell local currency Islamic bonds (sukuk) in the Malaysian market this year after a three-year hiatus, the head of the Jeddah-based multilateral lender told Reuters.

The deal would be the fourth ringgit-denominated sukuk from the AAA-rated IDB, one of the largest issuers of sukuk alongside the governments of Malaysia, Indonesia and Qatar.

"It could be both, private and public placement," IDB president Ahmad Mohamed Ali said on the sidelines of an industry conference in Sarajevo, adding that specific size and timing of the deal would depend on market conditions.
"We have a very active cooperation and relationship with Malaysia and sometimes we need to have ringgit and we will act according to the needs and issue sukuk in ringgit."

The IDB board has approved the issuance of up to 400 million ringgit ($99.9 million) in sukuk this year, from a 1 billion ringgit programme listed on Bursa Malaysia in 2008.

It has raised a total of 700 million ringgit via three sukuk transactions since then, the latter a 5-year 300 million ringgit sukuk in July of 2013.

Last year, the IDB increased the ceiling of its flagship London-listed sukuk programme to $25 billion from $10 billion, aiming to expand its financing activities.

The bank, which operates to promote economic development in Muslim countries and communities, has 56 member countries and counts Saudi Arabia, Libya and Iran as its largest shareholders.

(Reuters / 04 May 2016)
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