Standard & Poor's (S&P) Ratings Services has assigned its A-foreign currency senior unsecured debt rating to the Kingdom of Bahrain's proposed fourth issue of Islamic leasing bonds (Sukuk) scheduled for November 19.
The fourth issue of the bonds amounts to $50 million, carries a three-year maturity, and has a rental return of three percent per year paid half-yearly in May and November. At the same time, S&P's affirmed its A/A-1 local and A-/A-2 foreign currency ratings on the Kingdom. The outlook is stable.
The bonds, which will be issued by the Bahrain Monetary Agency (BMA) on behalf of the Government of Bahrain, will be registered and traded on the Bahrain Stock Exchange."The Sukuk are direct obligations of the Government of Bahrain itself rather than a special-purpose vehicle," said S&P's Credit Analyst and Director of Sovereign Ratings for the Middle East and Africa, Ala'a Al-Yousuf.
"Nevertheless, the Government of Bahrain has guaranteed these Sukuk through a binding agreement to continue renting the underlying real-estate assets according to the rental contract and to buy them back at the end of the three-year period at par value," continued Al-Yousuf.
The stable outlook reflects S&P's view that the government will maintain macroeconomic stability and a low debt burden, although it may not make sufficient or early progress on improving the transparency of public finances and implementing structural reforms. — (menareport.com)
© 2002 Mena Report (www.menareport.com)
