GLOBAL: In a
succession of eminent Sukuk deals closed over the last few months, the
Islamic capital markets continue their robust momentum as ‘AAA’-rated
Islamic Development Bank (IDB, the premier supranational development
agency for the industry) prices its US$1.5 billion Sukuk this week.
At 10bps over, the multilateral institution achieved its tightest spread
ever, indicating not only exceptional demand for the IDB papers but a
trend for the overall market, which has seen pricing tighten
significantly over recent deals. Speaking exclusively to IFN, the
regional head of debt capital markets MENAP for Standard Chartered,
Salman Ansari, commented that: “The issuance achieved the tightest ever
pricing spread for IDB at MS+10bps, considerably inside the prevailing
secondary levels.”
Jointly arranged by CIMB, Deutsche Bank, First Gulf Bank, GIB Capital,
HSBC, Maybank, Natixis, National Bank of Abu Dhabi and Standard
Chartered, the five-year debt was given initial price thoughts of 15bps
with previous guidance in the range of 10-15bps.
“Standard Chartered Bank is delighted with the outcome of the deal, which
achieved the issuer’s objectives to build on the success of the deal in
February 2014 in order to establish another liquid benchmark and further
position IDB in line with its supranational peer group," said
Salman.
In line with the IDB’s plan to come to market annually, this program
marks its fourth this year. In February the bank marketed its largest
public transaction valued at US$1.5 billion, followed by two privately
placed facilities – a US$100 million three-year program in April and a
US$1 billion five-year facility in July (the largest deal privately
placed by the IDB). Carrying a profit rate of 2.11%, the response for the
facility has been encouraging, with approximately US$2 billion in
orderbook registered. Salman further elaborated: "The success of the
transaction is also underpinned by a high-quality and diversified
orderbook, including a number of first time investors in the IDB credit.”
The senior unsecured Sukuk will be triple-listed: on the exchanges of
NASDAQ Dubai, London Stock Exchange and Bursa Malaysia.
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