GLOBAL: Last week’s vibrant Islamic debt capital markets activity continues on this week as we see exciting deals being announced amid several pioneering Islamic financing endeavors by industry players.
Indonesia’s Robert Pakpahan of the Ministry of Finance confirmed this week that Dubai’s Noor Bank will be investing over US$500 million in Indonesia’s sovereign Sukuk program as part of the Islamic bank’s strategy of expanding its asset base in emerging markets. To be executed via a privately placed facility, the announcement follows the Republic’s most recent successful IDR2.5 trillion (US$176 million) Shariah securities sale earlier this week which garnered over IDR6.3 trillion (US$444.08 million) in bids.
It is also learned that the World Bank’s International Finance Corp (IFC) would be raising US$100 million from the Sukuk market to purchase a portfolio of Shariah compliant receivables and assets. The US dollar paper, which has been assigned a preliminary ‘AAA’ rating from S&P, will be IFC’s third Sukuk sale.
On the Islamic financing side, Africa Finance Corporation made its initial foray into the sphere by securing a US$50 million Shariah compliant credit line from the IDB to fund development projects in IDB member countries. Meanwhile, Kuwait International Bank closed its maiden Islamic syndicated facility which received overwhelming response; initially launched at US$100 million, the Murabahah paper was upsized to US$320 million to accommodate demand from regional and international banks.
Another segment of the Islamic finance industry which saw an uptick of activities this week is the insurance sector. A slew of bancaTakaful partnerships across the Middle East and Asia were signed including: Syarikat Takaful Malaysia with RHB Islamic, EFU Life Assurance with Askari Bank in Pakistan, Manulife Indonesia with Bank Muamalat Indonesia, and T’azur Islamic Insurance Company of Bahrain with Khaleeji Commercial Bank. These alliances are in line with Takaful operators’ efforts to diversify their distribution channels in order to capture a larger market share leveraging the wider network of Islamic banks.
In people news: Markus Blenntoft, an English-qualified banking and finance lawyer with experience in Islamic finance, has joined K&L Gates’s Singaporean office from Dentons UKMEA. Capital Markets Malaysia named Azhar Zabidi as its new CEO effective the 1st September 2015 while Qatar Financial Center (QFC) appointed Hamed Al Saadi as its chief financial officer and tax officer. Hamed will also sit on the Executive Committee of the QFC Authority.