9/7/2012

Sukuk income to be injected to giant projects

Hurriyet - According to the bankers, Türkiye will secure financial resources from a brand-new sector with its new Islamic banking product and that the country can finance mega-projects such as the construction of the third bridge with this income. The total volume of global sukuk issuance was around USD 90 billion in 2011, whereas the same amount was achieved during the first six months of this year. Meanwhile, Qatar hit a record issuance worth a total of USD 4 trillion in July, and the size of the Islamic financial services sector is expected to reach USD 2.8 trillion by 2015. Türkiye, which has so far lagged behind in the sector, is now taking the first step to close the gap.

 

The Undersecretariat of the Treasury has authorized the Citigroup, HSBC and Liquidity House (a subsidiary of Kuwait Finance House) to investigate the potential of sukuk. And the first issuance on a dollar basis is expected to take place in the coming weeks. This transaction will allow the Treasury to perform long-term borrowings under more favorable conditions, while Türkiye is estimated to generate USD 500 million or USD 1 billion in the first phase and to secure financing worth of a few billion dollars later on.

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