IslamicFinance.de

According to Moody’s Investors Service, the Islamic Corporation for the Development of the Private Sector’s credit strengths lie within its robust liquidity buffer and high quality treasury portfolio. While ICD remained lossmaking in 2019, the size of the losses narrowed significantly, and capital adequacy was supported by ongoing payments from shareholders under the second general capital increase. Moody’s analyst Thaddeus Best expects that the ICD will temper its balance sheet expansion in order to preserve capital. It is anticipated that the bank’s increased focus on term lending operations will help ease credit risk over the coming years.

Credit rating agency Moody’s Investors Service expects Indonesia’s sukuk issuance to increase to US$27 billion this year from $16 billion last year. Lead analyst Thaddeus Best said on Tuesday that he expected Indonesia’s sukuk issuance to increase by about 68.75% as the government unveiled a Rp 695.2 trillion (US$47.3 billion) stimulus package to fight the pandemic. To help fund the package, the government is planning to raise Rp 900.4 trillion in the second half of this year to cover for a widening budget deficit of 6.34% of gross domestic product (GDP) this year. The option-adjusted spread of Indonesia’s US dollar-denominated government sukuk had fallen to almost 150 basis points (bps) as of July compared to its highest spread of 400 bps in March.