This bank is joining the sukuk club by September

The proposed sukuk issue of Bank Muscat, which is going to be the first Islamic bond or sukuk issue of an Omani bank, is seen sometime in September, a senior official of the bank told Times of Oman here yesterday.

Bank Muscat on Sunday said that it is seeking a blanket approval from shareholders for raising OMR500 million by way of Meethaq Sukuk Programme in various tranches in the Muscat Securities Market (MSM) and international markets through public subscription or private placement.

Sulaiman Al Harthy, Group General Manager – Islamic Banking- said that the bank is seeking approval at an extraordinary general meeting (EGM) on March 19 and thereafter seek permission from the Central Bank of Oman and the Capital Market Authority for the first tranche of the proposed sukuk issue. "We have to address any mismatch (in asset and liability) and that is the reason for the issue."

The bank said that the sukuk tranches will be of different amounts, currencies, maturities, profit rates issued on different dates and with varying terms and conditions of subscription.

The bank is also seeking permission from shareholders for another sukuk programme by its Saudi branch, which is worth 1 billion Saudi rial. Like its sukuk issue in Oman, Saudi sukuk is also planned with different amounts, maturities, profit rates, issued on different dates and with varying terms and conditions of maturity.

Further, the bank is seeking permission at the EGM for increasing the amount of the Euro Medium Term Note programme from $800 million to $2 billion. The EMTN programme involves issuing negotiable bonds in the international markets through public subscription or private placement.