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KFH Research: 33pct growth of global Sukuk issuance in September

KUWAIT, Oct 11 (KUNA) -- A report issued by KFH-Research, a subsidiary of Kuwait Finance House (KFH) revealed that the global sukuk market recovered during the month of September last year to reach in its new issuances USD 7.8 billion - a 33pct growth.
Malaysia still accounts for the largest share of the issuance where the Malaysian Ringgit came in first place in terms of the currencies that sukuk issued through. No sukuk were issued of the U.S. dollar in September.
The primary sukuk market picked up some pace during the month of September with USD 7.8 billion in new issuances, representing a growth of 33.3pct m-o-m. Cumulative issuances across the three quarters of 2013 amount to USD 83.0 billion, down from USD 103.0 billion over the same period of 2012.
Malaysia accounted for the largest share of the sukuk market during the month with 65.8pct of the issuance total. Malaysia accounts for 70.1pct of the market this year as compared to 74.0pct during 2012. Corporate issuances in the country total USD 9.1 billion this year as compared to USD 23.2 billion issued during the 9M12.
Sovereign issuances are down only 3.1pct, however, to USD 46.0 billion at the end-September. Saudi Arabian sukuk amounted to USD 453.2 million in the month, bringing the country's market share to 5.8pct for the month and 9.9pct over the 9M13 (9M12: 8.8pct). The most notable issuance during the month was by Saudi dairy and food firm Almarai Co. which completed the sale of a SAR1.7 billion (USD 453.1 million) sukuk, billed as the Gulf's first corporate hybrid Islamic bond. The issue was made on a floating-rate basis, and is perpetual with the option to redeem after five years. Almarai offered the sukuk only to "sophisticated investors" in Saudi Arabia, the company said in a statement on the website of the Saudi stock exchange. Almarai is raising money in part to expand its network of farms and poultry plants.
Sovereign issuers made up 84.9pct of the primary market in September, while government related entities accounted for 4.0pct and corporates took the remaining 11.1pct. The Malaysian ringgit accounted for 65.8pct of issuances during the month. There were no US dollar issuance in September; the last dollar sukuk was issued in August which was the only international paper during the third quarter.
A total of 47 sukuk were issued in September vs. 55 sukuk in August and 66 in July. Among these, 11 were issued by the corporate sector totaling USD 859.
7 million (August: USD 670.2 million, +28.3pct), 33 by sovereigns totaling USD 6.6 billion (August: USD 4.8 billion, +37.5pct) and 3 by government related entities worth USD 308.4 million (August: USD 392.1 million, -21.3pct). (end) fnk.ajs KUNA 111902 Oct 13NNNN