IFIS report reveals continued rapid growth in Islamic Bond issues. 13.4 billion dollars issued in the first half of 2006 alone, surpassing entire 200

IFIS report reveals continued rapid growth in Islamic Bond issues. 13.4 billion dollars issued in the first half of 2006 alone, surpassing entire 2005 total by 108%; Growth likely to continue with over 21.8 billion in deals already announced.

According to data compiled by IFIS (the Islamic Finance Information Service www.securities.com/IFIS), international and domestic issuances of Islamic bonds are showing robust growth driven by demand from investors and by innovation in Shariah compliant financial instruments.

Dubai Islamic Bank and Barclays Capital top IFIS’ International Book Runners League Table for half year with the USD$ 3.5 billion Sukuk issue for <?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" />Dubai’s Ports, Customs & Free Zone Corporation (PCFC).

Commerce International Merchant Bankers Berhad (CIMB) topped the Malaysian Islamic bond league with 8 issues amounting to an equivalent of USD 4.3bn. AmMerchant Bank Berhad managed three bond issues amounting to an equivalent of USD 1.05bn. Each of the remaining 25 managers handled domestic bond issues amounting less than USD 1bn. The amount corresponds to one third of all issues in the first half of this year.

To view full details of IntelliNews Islamic Finance Report click here or contact IFIS.

Highlights

• The USD$ 3.5 billion Sukuk issue for Ports, Customs & Free Zone Corporation (PCFC) is the world's largest Sukuk issue to date. It is also the first Sukuk to be convertible into equity upon an IPO and the first to be listed in The Dubai International Financial Exchange. Book runners are Dubai Islamic Bank and Barclays Capital. The issue was three times oversubscribed due to overwhelming investor demand and it was increased to USD 3.5bn from the initially set USD 2.8bn. The bond offers investors 30% of the shares of government-owned PCFC's companies if they go public in the next three years.

• The US entered the Sukuk market for the first time with East Cameron Gas Company’s USD $165.7mn issue. This Sukuk was also the first Islamic bond using hydrocarbon reserves as an asset class. Merrill Lynch was the lead book runner while Bemo Securities, Lebanon acted as co-arranger and Lead Manager. Proceeds from the sale will be used to finance exploration activity and to buy back a 50% stake in royalty rights that were sold to fund earlier investments.

• Saudi Basic Industries Corporation (SABIC) also issued Saudi Arabia’s first Islamic bond with a maturity date of 20 years, making it the longest dated Islamic bond in history.

Outlook

IFIS data suggest that the Islamic bond market is likely to continue its growth in the remainder of the year.  As of August 2006, a total of $21.8 billion issues worldwide, representing both international and domestic bonds, have been announced so far, on top of USD 13.74 billion bond issues completed in January to August of this year.

About IFIS

IFIS (Islamic Finance Information Service) www.securities.com/ifis is an information service designed to meet the unique requirements of Shariah compliant finance industry participants. IFIS is a single stop resource for investigating market opportunities in the world of Islamic finance. Using proprietary tools and research, IFIS delivers information on:

ü       League Tables for Islamic bonds, Deals & Transactions detailing structure of issues, issuers, term sheets and conditions etc.,

ü       Islamic financial Guidelines and legal content from Regulatory bodies;

ü       Shariah scholar database

ü       Shariah Rulings, Financial Market information, current news, press releases, conferences, events, academic and research papers

ü       Database on top global law firms involved in Islamic finance.

ü       IFIS E-Weekly Overview

ü       Much more……

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