World Bank unit lists $100m sukuk

Tom Arnold

• Last Updated: November 07. 2009 7:01PM UAE / November 7. 2009 3:01PM GMT

The International Finance Corporation (IFC), the private-sector arm of the World Bank, has listed a US$100 million (Dh367.3m) Islamic bond in Dubai and Bahrain.

The five-year sukuk, the first to be issued by any non-Islamic financial institution in the GCC for term funding, will raise money for IFC infrastructure and health projects in Yemen and Egypt.

Listed on NASDAQ Dubai and the Bahrain Stock Exchange on November 4, the dollar-denominated sukuk has a “AAA” rating, the highest measure of creditworthiness.

“The sukuk sets a milestone for Islamic finance and for financial markets in the GCC,” said Nasser Saidi, the chief economist at the Dubai International Financial Centre (DIFC).

It also represented an acknowledgement of the progress made by the region’s emerging financial sector in improving the legal and regulatory environment, he said.

The sukuk is likely to set a historic benchmark for all future Islamic financing operations by sovereign and corporate entities.

The IFC, which claims to be the world’s largest investment bank for development, invests through the private sector in emerging markets and is backed by a counter-guarantee from governments.

The sukuk was arranged by a regional syndicate including the Dubai Islamic Bank, Kuwait Finance House Bahrain, HSBC and Liquidity Management House.

“We are delighted to support the sukuk as its primary listing venue, providing a regulatory structure that promotes transparency for investors and visibility for the issuer,” said Jeff Singer, the chief executive of NASDAQ Dubai.

tarnold@thenational.ae