Bank Muamalat of Indonesia hopes to issue a global dollar denominated Sukuk worth between $50m and $100m before the end of the year.
Bank Muamalat is the second largest Islamic bank in Indonesia- as well as its oldest - and would use the funds to help implement its overseas expansion plans.
President director of the bank, Arviyan Ari (pictured right), indicated that the Sukuk, which is likely to have a tenor of five years or less, would be offered to investors in the Middle East and Malaysia and told reporters that: "We will issue the Sukuk this year
as soon as we open a branch office in Jeddah."
Muamalat is in the process of completing the formal KSA regulatory requirements for operating a branch in the Kingdom and also hopes to open a branch in Hong Kong. This global Sukuk would mark the bank's first foray into the international Islamic capital market.
The finance director of Bank Muamalat, Hendiarto, indicated that the bank also hoped to issue subordinated Sukuk worth between IDR800bn ($93m) and IDR1.5tr ($175m) for general corporate finance uses and which would be denominated in rupiah and which would be sold domestically.
Indonesia, with a population of 240m, has 11 fully-fledged Shari'ah compliant banks, with 23 conventional institutions offering Islamic banking through Islamic windows.
© The Islamic Globe 2011
