Middle East Bonds

Bahrain’s sovereign wealth fund Mumtalakat priced a seven year debut sukuk on Tuesday, which debt bankers said came flat to or even inside the sovereign curve. They put this down to credit quality, scarcity value and exceptional liquidity in the Middle East. But they felt that the additional rarity of the sukuk format was also a contributing factor, which other potential issuers should do well to note.

Luxembourg’s regulator is expected to approve what will be the Eurozone’s first wholly Sharia-compliant bank in a matter of weeks, Marco Lichtfous, partner at Deloitte Consulting in Luxembourg told IFIS.

Debt bankers are hoping to bring a new German corporate borrower to the sukuk market in 2015, participants at an EU Islamic banking and finance conference in London told IFIS.

Flydubai printed a debut sukuk on Wednesday, receiving over $2.6bn in orders for its five year dollar deal.

The Republic of Turkey raised $1bn with a 10 year sukuk on Tuesday, closing the gap between its conventional and Islamic funding costs to just a handful of basis points. Despite some disagreement over just how close the issuer got to conventional levels, the tight pricing provides ammunition for debt bankers trying to tempt other sovereigns into the Islamic market.

Bahrain’s sovereign wealth fund Mumtalakat priced a seven year debut sukuk on Tuesday, which debt bankers said came flat to or even inside the sovereign curve. They put this down to credit quality, scarcity value and exceptional liquidity in the Middle East. But they felt that the additional rarity of the sukuk format was also a contributing factor, which other potential issuers should do well to note.

Dubai government owned airline Flydubai opened books on a five year dollar sukuk on Tuesday morning. The initial price thoughts represented a fair starting point with room to tighten, said bankers away from the deal.

Mumtalakat will launch a debut sukuk deal on Tuesday afternoon. Debt bankers away from the deal felt that the final guidance range offered fair value, but were surprised that the issuer was not printing a larger deal.

Alistithmar Capital — a Saudi based asset manager — has hired Shariyah Review Bureau (SRB) to help it launch a series of Shariah compliant funds.

Saudi firm Advanced Petrochemical Co sold a debut sukuk on Monday, placing a SAR1bn deal with domestic Saudi investors.

Mumtalakat priced a debut sukuk deal on Tuesday afternoon almost flat to the sovereign curve.

Turkey launched its first 10 year sukuk on Tuesday morning in an effort to create a proper Islamic curve. The $1bn deal was comfortably subscribed, with only marginal disagreement between debt bankers on and off the deal over the concession relative to Turkey's conventional debt.