Turkish lender Albaraka Turk has secured a $213 million murabaha-based loan syndication, up from the $150 million it initially sought. The bank said the profit margin for the 370-day sharia-compliant facility was 125 basis points over three-month LIBOR. The lender had appointed ABC Islamic Bank, Dubai Islamic Bank, Emirates NBD Capital Ltd, Qatar Islamic Bank and Standard Chartered Bank to arrange the transaction. The bank is a unit of the Al Baraka Banking Group, which is also planing to issue dollar-denominated sukuk.
Turkish Islamic bank Albaraka Turk has received initial pricing feedback in the 10 % area for a potential U.S. dollar-denominated sukuk issue which would bolster its supplementary or Tier 2 capital, sources familiar with the matter told Reuters on Thursday.
The lender has received indications of interest totalling over $250 million, including those from joint lead managers, for the ten-year non-call five sukuk, the sources said. A potential deal is expected early next week subject to market conditions, they said.
Albaraka Turk, a unit of Bahrain-based Al Baraka Banking Group, has chosen Barwa Bank, Dubai Islamic Bank, Emirates NBD, Nomura, Noor Bank, Standard Chartered and QInvest to arrange the sukuk issue.
Turkish Islamic bank Albaraka Turk has reportedly picked seven arrangers for a potential dollar-denominated sukuk to bolster its supplementary or Tier 2 capital. The lender is expected to raise around $250 million, and the sukuk issue is planned before the end of the year. Albaraka Turk has chosen Barwa Bank, Dubai Islamic Bank, Emirates NBD, Nomura, Noor Bank, Standard Chartered and QInvest to arrange the sukuk issue. The bank, a unit of Bahrain-based Al Baraka Banking Group , didn't immediately respond to a request for comment.
Turkish Islamic bank Albaraka Turk has secured a $450 million dual-tranche murabaha loan, the proceeds of which will be used to expand its financing activities in the country. The bank closed a $278-million portion and a 154.5 million- euro ($174.7 million) tranche in the 367-days and 733-days tenures paying profit margins of 1.1 and 1.25 percentage points over the London interbank offered rate/Euro interbank offered rate respectively. Sixteen investors participated in providing the murabaha facility from Europe and the Middle East and North Africa region. Due to the oversubscription, Albaraka Turk decided to increase the facility size to $450 million instead of $400 million as originally planned.
Turkish Islamic lenders Turkiye Finans Katilim Bankasi and Albaraka Turk have applied separately to issue Islamic bonds, according to Turkey's Capital Markets Board. Turkiye Finans has applied to raise up to 1.5 billion lira ($513.2 million) through its wholly-owned unit, TF Varlik Kiralama. No tenor or details of underlying assets were given for the deal, which could be sold as a public offering or to qualified investors. Albaraka Turk, a unit of Bahrain-based Al Baraka Banking Group, has also applied to raise up to 1 billion lira through its asset-leasing company, Bereket Varlik Kiralama. The bulk of sukuk issuance in Turkey has come from the government and the country's Islamic banks, although corporate issuance is also growing.
Albaraka Turk takes up sukuk baton after Turkiye Finans. Albaraka Turk has picked arrangers as it aims to follow participation bank peer Turkiye Finans's recent return to the dollar sukuk market. But one investor warned that Albaraka may find its deal more challenging. Albaraka Turk is looking to issue up to $500m of five year paper and has asked BNP Paribas, Emirates NBD, QInvest and Standard Chartered to manage the sale. Albaraka filed to the Istanbul Bourse, but leads could not confirm the mandate or say if a roadshow will follow.
Albaraka Turk mandated four banks to secure a $200 million subordinated loan from international sukuk markets. Albaraka Turk is the Turkish subsidiary of Bahraini lender Al Baraka Bank.
Turkey with a population nearing 70 million is an untapped market for participation investment funds especially equities, exchange-traded funds (ETFs), exchange traded commodities (ETCs) and index-linked equity funds. These funds of course are not only aimed at Muslim investors but also at those interested in alternative ethical and socially-responsible investment products.
Following the introduction of the Banking Act 2007, the country’s four participation (Islamic) banks — Albaraka Turk, Kuveyt Turk, Turkiye Finans and Asya Finans Participation Banks — were brought under the same provisions of the above act, which meant that the regulatory regime was exactly the same as for the conventional banks.
According to Sungurlu, the Kuveyt Turk GoldPlus ETF is a major step by participation banks in the Islamic investment space.
The funds collected at participation banks were up 13 percent and reached 30.4 billion TL (21.1 billion USD).
The number of participation bank branches was up 6 percent to 595 and the banks employed 12,404 people in the mentioned period.
The Participation Banks Association of Turkey has currently four members, including Albaraka Turk, Bank Asya, Kuveyt Turk, and Turkiye Finans.