Sukuk

DMO lists FG’s N100bn #Sukuk on NSE

The Nigerian Stock Exchange announced the listing of the N100bn, seven-year, Federal Government Ijarah Sukuk with a rental rate of 16.47%. Director General of the Debt Management Office Ms. Patience Oniha said that the FGN Ijarah Sukuk was designed to finance critical road infrastructure across the country. She added that the proceeds would be used to further support the construction and rehabilitation of 25 roads across the six geopolitical zones of the country. According to Oscar Onyema, CEO of the Nigerian Stock Exchange, the listing has strong implications for emerging and frontier markets, which continually seek to unlock dormant pools of capital needed for economic growth and development.

#UAE's Sharjah Islamic Bank gives initial price guidance for dollar #sukuk

Sharjah Islamic Bank has given initial price guidance in the 160 basis points over mid-swaps range for a planned five-year dollar sukuk issue that has been capped at $500 million. The bank is expected to price the Islamic bonds later on Wednesday. The bank has appointed HSBC and Standard Chartered Bank as global coordinators and Bank ABC, Dubai Islamic Bank, Emirates NBD Capital, First Abu Dhabi Bank, HSBC, Noor Bank, and Standard Chartered Bank as joint lead managers and bookrunners for the issue.

Al Baraka Turk to exercise call option on $200m #sukuk

Albaraka Türk Participation Bank has sent a notice of redemption to its certificate holders on 06 April 2018 for its US$200,000,000 outstanding sukuk. Albaraka General Manager Meliksah Utku said the early redemption of the sukuk before its maturity in 2023 reflects the bank's partnership-centric approach to sukuk investors. The redemption date of the sukuk will be 07 May 2018 and will be redeemed at the aggregate of the outstanding face amount plus accrued but unpaid periodic distribution. Issued in May 2013 as a Tier 2 subordinated and USD-denominated sukuk al murabaha, the certificates were rated CCC+ by S&P and carried a coupon of 7.75% per annum.

#Sukuk proceeds being well utilised, says DMO DG

The proceeds of N100 billion Sukuk are being applied to infrastructure development across Nigeria. Director General of Debt Management Office (DMO) Ms. Patience Oniha said that the proceeds were designated for the financing of 25 road projects across the six geopolitical zones of the country. An inspector team visited Abuja-Abaji-Lokoja Road, Obajana-Okene Road, Suleja-Minna Road and Kaduna Eastern Bypass Road. During the inspection, the team assessed progress on the work that had been done as well as ongoing rehabilitation and construction works on the roads. Of particular significance is the fact that the funds from the Sukuk had made it possible to construct the Okene Bypass, which reduces congestion on the roads within the town.

As #Sukuk Disputes Simmer, Islamic Scholars Ponder Legal Risks

Senior scholars in Islamic finance are exploring ways to prevent legal disputes with new rules aiming to clarify responsibilities. The discussions are part of the annual sharia conference of the Bahrain-based Accounting and Auditing Organisation for Islamic Financial Institutions (AAOIFI). AAOIFI has developed a comprehensive sharia standard for sukuk that is being finalised, with work underway on three accounting standards and a governance standard. According to Said Bouheraoua, director of the Malaysia-based International Sharia Research Academy for Islamic finance, Dana Gas and other cases highlight the potential need to legislate work of scholars and penalties for breaches. At present, only the central bank of Malaysia has stipulated such fines, although this requires proving breaches occurred in 'bad faith' making penalties difficult to apply.

#Bangladesh Bank suggests regulator encourage Islamic Shariah compliant investment certificate in capital market

The central bank of Bangladesh has suggested encouraging Islamic Shariah compliant investment certificate Sukuk in the capital market. Capital market regulator BSEC pointed out that other Muslim majority countries such as Malaysia, Indonesia, KSA, UAE as well as non-Muslim majority countries like the UK and Singapore have Sukuk in their capital market. It also pointed out that Bangladesh needs to undertake measures to expand capital market for financing productive investments and infrastructural projects. Finance Minister Ama Muhith has recently expressed his plan to pave the way for the long-term financing of the capital market.

Manfa’a #Sukuk: A Novel, Transparent Debt Instrument

Transparency can serve as a powerful disinfecting driver of development and accountable governance. It can also promote responsible practices that support a broad range of policy objectives. These include exposing government corruption, reducing the scope for government revenues to be siphoned offshore, increasing the collection of domestic tax revenues, increasing the accountability and effectiveness of government spending, and reducing dependency on foreign aid.

#UK injunction restricts Dana Gas dividends in $700 million #sukuk dispute

United Arab Emirates energy firm Dana Gas received a new injunction from the English High Court restricting its ability to pay dividends or increase its debt. Sukuk holders have been trying to force the company to redeem the sukuk since last year. Dana said in late March that it would seek shareholder approval on April 11 to pay a cash dividend for 2017. The dividend would be worth 5% of capital or about 349 million dirhams (67.4 million pounds). But the English High Court order blocked Dana from making dividend payments unless it also sets aside money to redeem the sukuk. It also prohibited Dana from increasing its debt by more than $25 million.

Dubai’s Damac said to hire Barclays, HSBC for possible #sukuk

Damac Properties Dubai hired banks for a possible sale of U.S. dollar-denominated sukuk. Hired banks include Barclays and HSBC and more banks will follow to arrange the debt sale, which may happen as soon as this month. Damac is the latest company in the Middle East looking to tap the bond market amid a busy start to a year for debt sales. Besides sovereigns like Saudi Arabia and Qatar, Sharjah Islamic Bank, Oman Telecommunications and Noor Bank are among those waiting to access capital in the next few weeks. Issuance from the Gulf Cooperation Council climbed to $22.8 billion so far this year, the second-best first quarter in at least 12 years.

QIIB to raise up to $500m via #sukuk; plans roadshows

QIIB plans to raise between $300m-$500m via Sukuk this year. CEO Dr Abdul Basit Ahmed Al Sheibi said the bank got shareholders' approval and will hold roadshows in selected Asian and European markets next month. QIIB’s $2bn Trust Certificate Issuance programme has already been approved by the the UK Financial Conduct Authority and is being admitted to the official list of the FCA and the London Stock Exchange. The Programme has been assigned a provisional rating of A2 by Moody’s Investors Service Cyprus.

Source: 

https://www.thepeninsulaqatar.com/article/27/03/2018/QIIB-to-raise-up-to-$500m-via-sukuk-plans-roadshows

#UAE's Dana Gas plans cash dividend despite $700 mln #sukuk dispute

Dana Gas plans to pay a dividend for 2017 despite its legal dispute with investors demanding that the company settles $700 million of sukuk bonds. International funds and local investors want Dana to direct its resources towards repaying that debt. Dana last year halted payments on its sukuk, saying the bond had become unlawful in the United Arab Emirates because of changes in Islamic finance. Dana has been in talks for months with creditors to restructure its sukuk. One of the proposals envisaged Dana redeeming 10% with cash and rolling over 90% under new terms. However, creditors want the company to redeem a higher proportion of the sukuk.

Turkiye Finans gets regulatory nod for $450 mln #sukuk

Turkish Islamic lender Turkiye Finans has been granted regulatory approval to raise $450 million via dollar-denominated sukuk. It previously issued dollar-denominated sukuk in 2013, a $500 million five-year deal that matures in May. The bank has been a frequent issuer of sukuk in the domestic market and has also tapped investors in Malaysia through ringgit-denominated deals.

Republic of #Indonesia’s $3 Billion Sovereign #Green #Sukuk Offering

Indonesia issued a 5-year US$1.25 billion green Wakala Sukuk as the first issuance under its recently established Green Bond and Green Sukuk Framework. Norton Rose Fulbright has advised Abu Dhabi Islamic Bank, Citigroup, CIMB, Dubai Islamic Bank and HSBC, acting as joint lead managers and joint bookrunners. The Republic intends to use the proceeds exclusively to finance green projects, including renewable energy, sustainable transport, waste management, climate-related projects and green buildings. Alongside the 5-year green Sukuk, Norton Rose Fulbright also acted for the joint lead managers and joint bookrunners in the Republic’s 10-year US$1.75 billion Wakala Sukuk issuance.

#Indonesia sells 8.44 trillion rupiah in retail #sukuk

The Indonesian government sold 8.44 trillion rupiah ($613.19 million) of sukuk bonds to local retail investors. The sales were slightly higher than the initially-allotted 8.11 trillion rupiah. The tradeable sukuk carry a fixed annual rate of 5.9%, similar to the average rate offered by Islamic banks for 12-month and longer time deposits. The sukuk was sold to a total of 17,922 Indonesians this year. Since the retail sukuk was first launched in 2009, the government has sold a total of 144.78 trillion rupiah of the debt to nearly 250,000 people.

GCC sovereigns, GREs to drive #sukuk supplies in 2018

Growth in global sukuk issuance is expected to remain muted this year although issuance volumes are likely stable. Moody’s Senior Analyst Nitish Bhojnagarwala expects sukuk issuances to remain broadly stable between $90-$100 billion in 2018, again driven largely by sovereigns. Although the financing needs of sovereigns, banks and corporates in the GCC have decreased in recent months due to higher oil prices, these issuers are expected to continue to support the industry. Sukuk market activity is also supported by specialised multilateral entities, such as quasi-sovereigns, central banks and supranational entities, including the Islamic Development Bank (IDB), the International Liquidity Management Corporation (IILM) and the Arab Petroleum Investments Corporation (APICORP). Moody’s estimate that total sovereign sukuk volumes will remain stable in 2018 although some of the large issuances in 2017 may not be repeated in 2018, driving a marginal decline in the overall value.

Sovereigns and new issuers underpin #sukuk issuances

According to Moody’s Investors Service, sukuk issuance grew 17% in 2017 to reach US$100 billion, underpinned by large sovereign transactions from the Gulf Cooperation Council (GCC) region. At the same time, new issuers came into the market last year, including some corporates from China and France. The sukuk market activity is also supported by specialized multilateral entities, such as quasi-sovereigns, central banks and supranationals, including the Islamic Development Bank, the International Liquidity Management Corporation and many others.

Bidaya Home Finance Issues Plans for Selling Islamic #Sukuk Bonds

Bidaya Home Finance revealed plans to sell Islamic sukuk bonds worth 500 million SAR. Bidaya Home Finance hired the services of Ashmore Investment Saudi Arabia to arrange the program.

Sharjah Govt issues $1b #sukuk

The Government of Sharjah has issued a $1 billion (Dh3.67 billion) dollar sukuk on a 10 year maturity. The lead arrangers for the issue were Sharjah Islamic Bank, Dubai Islamic Bank, HSBC and Standard Chartered. Walid Al Sayegh, Director-General of Sharjah Finance Department, pointed out that the timing behind the issuance makes this the first sovereign sukuk issued in 2018 in the region. It is also the largest sukuk issuance by the government of Sharjah, which previously carried out two issuances. Al Sayegh said that the revenue from these sukuk would be used for infrastructure projects, as well as urban and financial development of Sharjah.

#Kazakhstan eyes sovereign #Sukuk, central Sharia board

Kazakhstan plans to issue sukuk in the coming months as part of its efforts to develop Islamic finance in the country. Alibek Nurbekov, head of the Islamic finance at the Astana International Financial Center (AIFC), said the final legislative changes to allow issuance of sovereign sukuk were nearly complete. Issuance of sovereign sukuk is planned in the first half of 2018 in total up to $300 million dollars. The sale would follow sukuk issued by the Development Bank of Kazakhstan in 2012, a deal that raised 240 million ringgit ($61.51 million) via the Malaysian market. Nurbekov added that a central sharia board would be established in the first half of the year, while rules covering Islamic insurers and a fund for Islamic endowments are also planned.

Saudi Dar Al Arkan Real Estate hires banks ahead of 5-year dollar #sukuk deal

Dar Al Arkan Real Estate Development has mandated banks to arrange investor meetings ahead of a planned U.S. dollar five-year sukuk offering. If the deal goes ahead, Dar Al Arkan will be the first Saudi company to issue an international bond this year. The banks mandated are Alkhair Capital, Deutsche Bank, Dubai Islamic Bank, Emirates NBD Capital, Goldman Sachs International, Nomura, Noor Bank and Standard Chartered Bank, who will act as joint bookrunners of the deal.

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