DUBAI, March 10 (Xinhua) -- Dubai-based state-owned and private corporations show no let-up in issuing Islamic bonds or "sukuk" as market demands remain unchanged.
On an almost weekly basis, big stakeholders in the United Arab Emirates announce plans to make use the booming market of sukuk amid an unprecedented economic comeback.
The debut was made by Dubai Electricity and Water Authority ( DEWA) which issued a sukuk worth 1 billion U.S. dollars with 5 years duration, attracting orders of over 5.5 billion dollars.
The DEWA listed the Islamic bond at the NASDAQ Dubai, the UAE's second stock exchange and the Middle East's only international exchange.
Unlike conventional bonds, sukuk do not pay interest based on coupons, but they distribute periodical profit shares based in tangible assets (such as real estate) to their investors.
Earlier last week, Dubai Islamic Bank (DIB) said it is preparing for the launch of the first bank sukuk of the year 2013.
The DIB, the Gulf region's oldest Shari'ah-compliant bank, has picked local banks Emirates NBD and National Bank of Abu Dhabi as well as British lenders HSBC, and Standard Chartered Bank to consult them on the sukuk issuance.
According to a report issued by Islamic bank Kuwait Finance House (KFH) earlier last week, sukuk worth 131 billion dollars were launched worldwide, representing a 54 percent year on year increase.
The latest state-owned candidate jumping on the bandwagon was Emirates Airline. The Middle East's fastest growing carrier said on March 6 it hired banks in order tap the sukuk market, Bloomberg reported.
According to KFH, global issuances of Islamic bonds reached 22 billion dollars earlier this year.
Dubai ruler Sheikh Mohammed Bin Rashid Al-Maktoum said that he aims to transform the emirate into the global center for Islamic finance 2013. In order to achieve this goal, Dubai has to beat Malaysians as a sukuk center, where in 2012, 70 percent of all global Islamic bonds were issued.
Over 900 dead pigs found floating in Shanghai river
Feedback
RSS
