Reviewing Global Sukuk Pipeline In 2015

Following are major Islamic bond issues in the global Sukuk pipeline.

The Thomson Reuters Global Sukuk Index is at 115.36865 points, down from 115.82559 at the end of last month but up from 109.78969 at the end of 2013. The Thomson Reuters Investment Grade Sukuk Index is at 113.01591 points, against 113.92596 at end-November and 107.28036 at the end of 2013.

NINGXIA – China’s AVIC Capital Co said in late December that its unit AVIC Securities had signed an agreement to advise the government of the country’s Ningxia Hui Autonomous Region on the global issue of up to $1.5 billion worth of instruments such as Sukuk and U.S. dollar bonds, with maturities up to five years.

INDONESIA – The government plans to issue 7.14 trillion rupiahs (US$572 million) of project-based Sukuk next year to finance the development of three infrastructure programs and develop the Sukuk market, the Jakarta Post quoted Suminto, director of Islamic bonds at the debt management office, as saying in mid-December.
The finance ministry plans to sell retail Sukuk worth around 20 trillion rupiahs ($1.63 billion) in April 2015, an official at the debt management office said in early December.
The government plans to issue global Sukuk in the first quarter of 2015 before the U.S. Federal Reserve starts increasing interest rates, Scenaider Siahaan, a director at the debt management office, told Reuters; he did not give details.

AXIS REIT – Malaysia’s Axis REIT said in mid-December that it planned to expand its Sukuk program to 3.0 billion ringgit ($863 million) from its existing size of 300 million ringgit, and extend the program to a perpetual program from 15 years.

TURKIYE FINANS – Turkish Islamic lender Turkiye Finans Katilim Bankasi applied to issue 143 million lire ($60.5 million) via Sukuk, the Capital Markets Board said in mid-December.

TITAN TRAILER – Turkiye Finans received regulatory approval for a 71 million lira Sukuk issue by trailer manufacturer Tirsan Treyler Sanayi ve Ticaret, the Capital Markets Board said in mid-December.

1MDB – Malaysia’s sovereign wealth fund, 1Malaysia Development Bhd, has postponed the sale of up to 8.4 billion ringgit of Sukuk to 2015, two people familiar with the matter said in early December.

GULF FINANCE HOUSE – Bahrain’s Gulf Finance House is in talks on buying two asset management firms for a total of up to $500 million and is planning to increase debt to finance the deals, chief executive Hisham Al-Rayes told Reuters in early December. He said GFH would have a preference for using Sukuk over syndicated loans.

UNITAPAH – Malaysia’s UniTapah Sdn Bhd plans to issue up Sukuk Murabaha of up to 600 million ringgit to refinance a term loan funding construction of the new campus for Universiti Teknologi MARA in Perak, RAM Ratings said in early December.

KENYA – Kenya will issue its debut Sukuk in the next financial year to June 2016, not this one as some had expected, its finance minister said at the start of December.

CAMAS – Malaysia’s state-backed mortgage lender Cagamas will raise to $2.5 billion with a multi-currency Islamic bond program, credit agency RAM Ratings said at the start of December.

DRB-HICOM – Malaysian conglomerate DRB-Hicom said in late November it had obtained Securities Commission approval for a perpetual Sukuk musharaka program of 2 billion ringgit.

TURKEY – The Turkish Treasury said in late November it would issue Sukuk worth 1.5 billion lire by the end February of.

NORTHPORT MALAYSIA – Port operator Northport Malaysia plans to issue Sukuk before the end of the year in its first drawdown off a recently established 1.5 billion ringgit program, bankers said.

ICD – The Islamic Corporation for the Development of the Private Sector, the private sector arm of the Jeddah-based Islamic Development Bank, plans to tap Islamic capital markets to raise as much as $1.2 billion in long-term funds during its current financial year, which started in October, its chief executive told Reuters in late November.

POINT ZONE – Malaysia’s Point Zone (M) Sdn Bhd, a subsidiary of KPJ Healthcare, received in early November authorization from the Securities Commission to establish a Sukuk program of up to 1.5 billion ringgit.

MALAYSIA BUILDING SOCIETY – Malaysia Building Society Berhad is planning a second issuance of its structured covered Sukuk commodity Murabaha program, aiming to raise to 700 million ringgit, bankers said in mid-November.

KUVEYT TURK – Turkish Islamic bank Kuveyt Turk mandated CIMB Investment Bank, Kuwait Finance House, and Maybank Investment Bank to issue up to 2 billion ringgit of Sukuk in Malaysia, bankers said in mid-November.

FLEETCORP – Turkey’s Fleetcorp, wholly owned by Kuwait’s The International Investor, has received regulatory approval to raise to 150 million lire via Sukuk, the Capital Markets Board said in early November.

BANK RAKYAT – Bank Kerjasama Rakyat Malaysia was to kick off bookbuilding on a ringgit-denominated sukuk in the week of Nov. 10. CIMB and Maybank are joint lead managers for the offer, which is expected to comprise tenors of five and/or seven years. The bank aims to raise at least 300 million ringgit.

AIRASIA – AirAsia Bhd, Asia’s largest budget airline, is seeking to raise to 1 billion ringgit with a Sukuk program to fund aircraft and spare part purchases as well as to refinance its debt, bankers said at the end of October.

BANK MUSCAT – The Islamic unit of Bank Muscat, Oman’s largest lender, plans to tap the Sukuk market in the first quarter of next year, in what would be the first Sukuk sale by a bank in the country, a bank official said in late October. The issue would fall under a 500 million rial ($1.3 billion) Sukuk program which shareholders approved in March this year.

TEMASEK EKSLUSIF – Temasek Ekslusif, a wholly-owned unit of Malaysian property developer Gamuda Bhd, will raise to 1 billion ringgit with Islamic bonds, rating agency RAM Ratings said late in October.

OMAN – Oman’s government will make its first issue of rial-denominated Sukuk for the domestic market as soon as in the first quarter of 2015; the issue may be worth the equivalent of around $300 million or $400 million, with maturities of five or seven years, financial affairs minister Darwish al-Balushi told Reuters in late October.

KAZAKHSTAN – Kazakhstan may make its second international issue of Sukuk next year, central bank governor Kairat Kelimbetov told Reuters in late October. The issue would probably be quasi-sovereign but plans have not been finalized yet; details are likely to be decided near the end of this year.

LUXEMBOURG – Luxembourg is open to the idea of making more sovereign Sukuk issues after conducting its first such issue at the end of September, Luxembourg finance minister Pierre Gramegna told Reuters in late October.

TUNISIA – The Tunisian government picked banks including Citigroup, Natixis and Standard Chartered for a debut U.S. dollar Sukuk issue, sources said in late October. Tunisia’s prime minister told Reuters that the $500 million issues were expected to be completed this year.

ETISALAT – Abu Dhabi-based telecommunications firm Etisalat is planning its first Sukuk issue, bankers told IFR in early October. The company will have the documents ready in the coming weeks, but the deal is more likely to be launched in early 2015, they said.

BANK ISLAM – Malaysia’s Bank Islam, wholly owned by BIMB Holdings, has set up a 1 billion ringgit subordinated Sukuk program to boost its regulatory capital, RAM Ratings said in early October.

BINTULU PORT – Malaysia’s Bintulu Port Holdings is expected to prepare for its planned Samalaju Port project with a proposed Sukuk issue,  likely to be 700-800 million ringgit, The Edge daily reported in early October.

MALAYSIA MARINE – Malaysia Marine and Heavy Engineering said in late September it had received approval from the Securities Commission to establish a Sukuk Murabaha program of up to 1 billion ringgit.

MAHCO MALAYSIA – Mahco Malaysia, a vehicle to issue Sukuk for Mohammed Othman Al Houkail Trading & Contracting Co, a medium-sized contractor in Saudi Arabia, proposed an Islamic medium-term note program of up to 300 million ringgit, RAM Ratings said in late September.

CENDANA SEJATI – Malaysia’s Cendana Sejati, a unit of local bank Masraf Al Barakah, proposed a 360 million ringgit senior sukuk murabaha medium-term note programme, RAM Ratings said in late September.

AGAOGLU – Turkish construction-to-energy Agaoglu Group plans to raise around $300 million by issuing Sukuk, Niyazi Albay, Agaoglu’s chief investment officer, told Reuters in mid-September. No specific time frame was given.

AKTIF BANK – Aktif Bank, Turkey’s largest privately-owned investment bank, has received regulatory approval to issue 200 million lire in Sukuk, the Capital Markets Board said.

DOGUS GROUP – Turkish conglomerate Dogus Group has received regulatory approval to raise $370 million by issuing the country’s first U.S. dollar-denominated corporate Sukuk, the Capital Markets Board said in late August. No time frame was given.

CIMB ISLAMIC – CIMB Islamic, the sharia-compliant unit of Malaysia’s second-largest bank, is preparing an Islamic bond program to raise to 5 billion ringgit, rating agency MARC said in late August.

SUNWAY – Malaysian property developer Sunway will raise to 2 billion ringgit by issuing Sukuk mudaraba, it said in August; short-term commercial paper under the program will have maturities of between a month and a year, while medium-term notes will have maturities of one to seven years. Sunway will make its first issuance within two years.

RAS AL-KHAIMAH – The emirate of Ras al-Khaimah, part of the UAE, invited banks to pitch for arranger roles on a potential dollar-denominated Sukuk, sources said in early June. However, bankers said in August that Ras al-Khaimah had sent out requests for proposals for a syndicated loan, casting doubt on whether the planned Sukuk issue would now go ahead.

ADIRA DINAMIKA – Indonesia’s PT Adira Dinamika Multi Finance plans to raise at least 500 billion rupiahs ($42 million) with ringgit-denominated Sukuk in Malaysia by the end of the year, bankers said.

K-ELECTRIC – Karachi-based utility K-Electric plans to raise as much as 22 billion rupees ($223 million) through Sukuk to refinance existing debt, the company said in late June.

BANK MUAMALAT – Malaysia’s Bank Muamalat, a unit of sovereign fund Khazanah and auto-to-property conglomerate DRB-Hicom Bhd, will raise to 2 billion ringgit with Islamic bonds, credit agency Malaysian Rating Corp said in late June.

BAHRI – National Shipping Co of Saudi Arabia (Bahri) plans to arrange long-term sharia-compliant financing in the next year to replace a bridge loan backing its $1.3 billion acquisition of Saudi Aramco’s marine unit, Bahri said in June. Banking sources previously told Reuters Bahri was looking at a potential debut Sukuk issue to replace the bridge loan.

SOCIETE GENERALE – Societe Generale completed the roadshow for the first issue in its 1 billion ringgit multi-currency Sukuk program in Malaysia, and would decide on the size in days, the bank said on June 18. In early July, banking sources said Societe Generale was still seeking a window to launch.

IFC – The International Finance Corp, the World Bank’s lender to the private sector, is considering a return to the Islamic bond market, an IFC official said. A Sukuk issue is still in the early stages of discussion but would likely be in the fiscal year starting in July 2014.

JORDAN – Jordan’s government is studying a proposal to issue its first Islamic bond as early as next year, possibly raising over $1 billion in multiple currencies, but a preference for concessionary loans from aid donor countries could hinder the plan, government sources said.

MALAYSIAN RESOURCES CORP – Malaysian Resources Corp, a local construction firm, said on June 12 it would issue Islamic bonds to raise to 680 million ringgit for land acquisitions and working capital.

BANGLADESH – The central bank is seeking to amend rules on its existing Sukuk program to broaden its use and allow for sovereign issuance by the government, a central bank spokesman said in June.

AL OTHAIM – Saudi Arabia’s Al Othaim Real Estate and Investment Co, owner of five shopping malls in the kingdom, plans to issue its debut local currency Sukuk as early as in June, sources aware of the matter said at the start of the month. The transaction is likely to be worth between 500 million and 1 billion riyals ($133-267 million), one of the sources added.

JEDDAH ECONOMIC CO – Saudi Arabia’s Jeddah Economic Co said in mid-May it was in talks with local banks to raise funds for the 14 billion riyals in the first phase of its Kingdom City project. For part of the money, “we are looking at the bonds and Sukuk market but this will need a structure in place, which we are working on,” chief executive Mounib Hammoud said.

pelaburan MARA – Malaysia’s Pelaburan MARA, the investment arm of Majlis Amanah Rakyat, plans to issue Sukuk worth up to 1 billion ringgit this year or next to finance its investments in the oil and gas and technology sectors, group chief executive Nazim Rahman was quoted as saying in April by The Edge Financial Daily.

HUA YANG – Malaysian property development firm Hua Yang Bhd said on April 29 it had won approval from the securities commission to raise to 250 million ringgit with an Islamic bond program.

FIRST GULF BANK – Abu Dhabi’s First Gulf Bank, the third-largest bank by assets in the United Arab Emirates, plans to raise to 3.5 billion ringgit with Islamic bonds in Malaysia, RAM Ratings said in March.

KILLER REIT – Turkish real estate investment trust Kiler GYO plans to issue a five-year Sukuk worth at least $100 million in the second half of this year, parent company Kiler Holding’s chief financial Officer Kaan Aytogu said in February.

ACWA – last December, Saudi Arabia-based water and power project developer ACWA Power said it had raised a 1.77 billion riyal Islamic loan from four local banks to help finance investments including acquisitions and act as a bridge to a Sukuk issue in 2014.

ADB – The Asian Development Bank said in December that it was considering an Islamic bond issue as early as 2014.

Originally published on www.emirates247.com