Gulf sukuk bond sales beat Malaysia

Click Here: Gulf Daily News – Gulf sukuk sales beat Malaysia

Sheikh Muszaphar Shukor has a problem. Two problems. The first is that Mecca keeps moving. MANAMA: Gulf sales of Islamic bonds overtook those in Malaysia for the first time, Moody’s Investors Service said, rising to $13.2 billion so far this year as the two regions vie for primacy in the Islamic finance industry. Sales by governments and companies in the UAE, Bahrain and four other Gulf countries accounted for 55 per cent of the global total for bonds that comply with Islamic law to the end of August. That compared with $9.7bn sold in Malaysia, Moody’s Middle East and Islamic Finance analyst Faisal Hijazi said.”The Middle East, mainly the Gulf, is progressing quickly to become the global leader in the provision of Sharia-compliant sukuk structures and products,” Hijazi said.

Malaysia, with a majority Muslim population of 26 million, has traditionally led the global Islamic finance industry in sales, regulation and standardisation. Outstanding Islamic bonds, or sukuk as they are also known, totalled more than $80bn to the end of June, with over two-thirds unlisted, according to Standard & Poor’s. Sukuk are typically backed by assets that pay a dividend or rent to holders, but are generally still priced against interest rate benchmarks such as the London Interbank Offered Rate. Though Malaysia has fallen behind in sales of sukuk, it still leads in total sales. More than 60pc of the world’s outstanding Islamic bonds were denominated in Malaysian ringgit at the end of July, according to Moody’s.

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