KFH-Research: $131bn total issuance of Sukuk in 2012
- Kuwait: Saturday, January 12 - 2013 at 10:14
- PRESS RELEASE
KFH-Research issued a report that revealed that total Sukuk issuance by end of 2012 reached $131bn with 54% increase than 2011, where total Sukuk issuance in December reached $8bn with a 61% increase compared to last year.
Sukuk issuances continued at decent levels in December as we close off another tremendous year for the Islamic capital markets. A total of $8.1bn was issued during the month, 61.7% higher than the same period of 2011. This means total issuances for 2012 round up to $131.2bn representing a y-o-y increase of 54.2%.
Malaysia dominated the month in terms of amount issued, accounting for a 90.2% market share, while there were a distinct absence of sukuk from Indonesia and the UAE. Malaysia was domicile to 74.0% of all primary market issuances in 2012, followed by Saudi Arabia (8.0%), the UAE (4.7%) and Indonesia (4.6%). Governments remained the largest issuer type, representing 70.1% during December while there were a number of significant issuances also issued in the financial services sector. Both sectors have represented 61.8% an11.4% of the primary market respectively in 2012 while the transport sector represents 13.0%.
Notable issuances during the month include the SAR1.9bn ($506.6m) sukuk issued by Banque Saudi Fransi and structured using Murabahah and Mudharabah principles. The sukuk has a seven year tenure that pays 3 months SIBOR + 110bps on a quarterly basis. Similarly, FWU Group issued the first sukuk by a German corporate and the largest sukuk from a European corporate, worth $55.0m.
Sovereign issuers made up 70.1% of the primary market in December while government related entities accounted for 6.8% and corporates took the remaining 23.2%. Malaysian ringgit accounted for 91.8% of issuances during the month as compared to 74.0% over the year.
A total of 55 sukuk were issued in December vs. 55 sukuk in November and 72 in October. Among these, 31 were issued by the corporate sector totalling $1.9bn (November: $2.7bn, -29.6%), 19 by sovereigns totalling $5.7bn (November: $5.7bn, +0.0%) and 5 by government related entities worth $548.8m (November: $1.1bn, -50.1%).
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