Middle East Bonds

Dubai Islamic Bank has increased its sukuk holdings rapidly over the last nine month but is still on the hunt for more paper. On its wish list is supply from Africa and South East Asia, two regions into which it is planning to expand.

DIFC Investments — Dubai International Financial Centre’s investment arm — has set roadshow dates, beginning on Thursday, for its second ever benchmark sukuk sale.

Islamic banks in the Gulf Co-operation Council states are suffering from a perception problem, according to a report from Price Waterhouse Coopers (PwC) published on Tuesday. The firm found that although the banks have huge potential, existing and likely customers often believe that Islamic banks are not true to Shariah values.

Mubadala GE Capital has mandated Barclays and Citi as global co-ordinators and joint lead managers and First Gulf Bank, HSBC, Natixis as joint lead managers for a dollar benchmark 144A bond.

Bahraini financial institution Bahrain Commercial Facilities Co has made a rare visit to the MTN market.

Falah Capital, the only Islamic exchange traded fund (ETF) listed on the New York Stock Exchange, has outperformed broader US market indices in its first week weeks, the company’s chief executive told IFIS. The dearth of passively managed Islamic funds in the US stands in stark contrast to growing appetite for such products, and Falah Capital’s CEO is hoping to watch the fund grow in size several times by the end of the year.

Advanced Petrochemical Co starts investor meetings on Sunday ahead of its first sukuk, and has mandated HSBC Saudi Arabia and Riyad Capital to manage the transaction. But the deal is unlikely to be large enough to help bolster Saudi sukuk supply, which has dropped off sharply after strong issuance in the previous two years.

Islamic finance risks falling behind the conventional capital markets in its support of social development and the real economy including SME financing.

Société Générale has hired Karim El Zein for its Middle East DCM team. El Zein will be based in Dubai.

Sukuk is breaking free of regional boundaries to become an increasingly global market, senior IMF economists have told IFIS. Concentration risk is still one the biggest challenges for the growing market, but they expect the clear benefits of issuing sukuk bring more and more new issuers into the fold.

A grim secondary performance by Goldman Sachs’s debut sukuk has turned the deal into a ready weapon for anyone holding that the Islamic market is not ready for such non-halal borrowers. But despite the performance, Goldman's sukuk will be remembered as the issue that shook the market purists' defences.

The dollar sukuk market is on course for a photo finish with 2012’s record volume, with flydubai pushing forward plans for a debut deal and market participants suggesting volatile macroeconomic conditions have added impetus for another prospective borrower, Turkey.