IslamicFinance.de

Companies will need to pay more to borrow money through sukuk even as Malaysia, the global driver of Islamic finance, faces jitters amid a harsher economic environment and heightened political risk. Higher premiums would be necessary to attract investors and to provide investors with reasonable buffers against higher interest rates in the event US hikes its interest rates by year-end, said Meor Amri Meor Ayob, CEO of Bond Pricing Agency Malaysia. Aside from some domestic-specific uncertainties, the factors that are said to be affecting the Malaysian sukuk market — low oil prices, slower exports growth — are also similarly affecting other emerging markets and oil exporting countries.