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Global Sukuk Markets - November in Review

Despite Adha Holidays, Sukuk market was active in November, while major issues carried forward to next year as 2010 comes to an end, writes Adnan Halawi.

November Issues
Despite the long Eid break in the Muslim world, Sukuk worth USD 5.79 billion were issued in November, up 8% from the previous month and more than double from the Sukuk issued in November last year.
The most remarkable issue in November came from the United Arab Emirates (UAE), largest Islamic lender Abu Dhabi Islamic Bank ( ADIB ) which closed a USD750 million sukuk on November 4^th, marking the largest corporate issue out of UAE this year. Listed on London Stock Exchange and paying 3.745% on semi annual basis, ADIB 's second sukuk was oversubscribed 4.8 times.
From Malaysia, the world's largest market for Shariah compliant bonds, the Government issued a MYR3 billion (USD950 million) tranche part of its Bai Bithaman Ajil Government Investment Issue on November 29^th.
Earlier in the month, Trans Thai-Malaysia (Thailand) (TTMT) - subsidiary of Thai PTT Group closed MYR600 million Sukuk program in full with tranches of tenors ranging from 5 to 15 years. The significance of this issue lies in the fact that it represents the first Thai issuer in Islamic capital markets and could act as a catalyst for more Islamic financing by Thai issuers in Thailand and abroad.
On November 8, Government of Pakistan sold successfully PKR51.84 (USD600 million) billion sukuk as part of its new PKR80 billion Ijarah Sukuk program.


Source: Zawya Sukuk Monitor www.zawya.com/sukuk
Pipeline Issues:
Among the major issues anticipated in December is the second tranche of Malaysia Airports MYR3.1 billion Sukuk program. The second tranche is expected to be a 12 years MYR1 billion (USD317 million) one following a MYR1 billion tranche in August earlier this year. The Pakistani Government is expected to see another part of its Ijarah program on December 15^th.

While the year comes to an end, most issuers, both corporate and sovereign are expected to postpone the sale of Islamic papers to next year. What follows is a list of major sukuk anticipated to close in 2011 according to Zawya Sukuk Monitor's pipeline:

Issuer	Type	Country	Size ($mn)
Nakheel	Corporate	UAE	1600
Etisalat	Corporate	UAE	1000
Al Baraka Banking Group	Corporate	Bahrain	200 - 500
Islamic Bank of Thailand	Corporate	Thailand	166
National Commercial Bank (NCB)	Corporate	Saudi Arabia	-
Sipchem	Corporate	Saudi Arabia
Saudi Electricity	Corporate	Saudi Arabia
Al Baraka Egypt Bank	Corporate	Egypt	150
Al Rajhi - Jordan	Corporate	Jordan
Sudan	Sovereign	Sudan	200 - 600
Kazakhstan	Sovereign	Kazakhstan	300
Yemen	Sovereign	Yemen	-
South Africa	Sovereign	South Africa	-
Palestine	Sovereign	Palestine	-
Senegal	Sovereign	Senegal	-

Adnan Halawi
Senior Sukuk Analyst
ahalawi@zawya.com

© Zawya Select 2010

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