Middle East Bonds

Investors took advantage of Turkey's fast developing sukuk market this week by selling outstanding Kuveyt Türk notes and buying into a benchmark size debut from Türkiye Finans. The relative value play immediately paid off, as the new deal rallied one and a half points in the secondary market.

Al Bayan Group, a Saudi-based firm, has issued MR200m ($65.9m) of sukuk into Malaysia - the first tranche of its MR1.0bn ($329m) sukuk wakalah programme.

Qatar National Bank this week joined a very small group of Middle East banks to have executed a drive-by bond issue, bringing $1bn of seven year bonds at a 2.875% yield.

The Central Bank of Bahrain (CBB) has raised BHD18m ($47.7m) through its monthly issuance of sukuk al-salam.

Investors labelled a $500m sukuk from Sharjah Islamic Bank this week as exceptionally tight, but the deal nonetheless drew $3.2bn of orders on Tuesday. The sukuk priced inside the initial guidance range, ending up with a profit rate of 2.95% after the leads mooted low 3% on Monday.

Sharjah Islamic Bank (SIB) plans to issue a benchmark dollar Reg S sukuk and is holding roadshows in Europe and Asia.

UAE bank Emirates NBD this week drew a well diversified $2.6bn order book as it priced its $750m subordinated bond at a tight price.

The sukuk market had its eyes opened to an expansive new landscape this week, as Saudi Electricity Company defied the doubters to bring the first ever benchmark dollar 30 year tranche, writes Dan Alderson.

After two quiet months, the international sukuk market is ending the quarter with a flourish, with $2bn of notes pricing this week.

Corporate sukuk added flavour to the Islamic feast this week, as Emirates, the UAE-based airline, priced a $1bn 10 year amortising sukuk. The deal was issued at 300bp over mid-swaps and received a three times covered order book.

Dubai Islamic Bank is lining up the first bank sukuk of the year — a deal that could kick off a busy month for financial institution issuing Islamic bonds after 2013’s muted start. DIB’s perpetual tier one deal will come via Emirates NBD, HSBC, National Bank of Abu Dhabi and Standard Chartered.

Emirates NBD had a double surprise for bankers this week when it printed a privately placed subordinated debt deal — a rare instrument for a Middle Eastern bank and one that is usually printed in syndicated format.