The Bahrain Monetary Agency (BMA) has announced plans to launch its largest issue of Islamic bonds this January. The $250 million offer, called the Ijara Sukuk will have a maturity of six years beginning on February 3, 2003.
Subscriptions will be received in January with the rental return to be set at a prior date. All commercial banks, Islamic finance houses and insurance companies will be eligible to participate in the issuance.
Ijara Sukuk are leasing bonds, which are ideal Islamic financial structures because they are asset-backed securities and therefore can be listed on a stock exchange and be traded. Islamic bonds do not pay interest, which is banned by Muslim law, but they mimic
such payments by discounting the bond's selling price or through profit sharing.
The newest issuance is the BMA’s fifth Ijara offering, the first of which was launched in September 2001 and was fully subscribed. The second, a $70 million issue launched in February 2002 was oversubscribed by 160 percent.
The BMA’s most recent issue, a $50 million offer launched in November was oversubscribed by 476 percent. Standard & Poor's (S&P) Ratings Services assigned its A- foreign currency senior unsecured debt rating to the bonds. — (menareport.com)
© 2002 Mena Report (www.menareport.com)
