IslamicFinance.de

Additional costs for issuing an Islamic bond no longer have to be paid - the "sukuk premium" is gone. As a senior executive at Deutsche Bank explained, this will result in a hige increase in sukuk issuance. At the same time, tenors will become longer. Until last year, the reasons of common premium payment were that issuers catered to a smaller investor base. Also, in comparison with conventional bonds, investors were little familiar with sukuk structurs. This is now not the case any more since a heavy investor demand for sukuk this year can be observed.

Islamic Development Bank, or IDB, gave out a $750 million five-year, benchmark sukuk with a price guidance of 35 basis points over mid-swaps.
One of the banks that is leading the sale told Dow Jones that BNP Paribas SA, Deutsche Bank AG, HSBC Holdings PLC and Standard Chartered Bank were joint bookrunners on the transaction.