Growth in cross-border sukuk points to greater convergence

MANAMA: Growth in cross-border Islamic bond issues points to greater convergence in an industry that has been divided by tensions between the Middle East and Asia over sukuk rules, opening the door to a much wider pool of investors.

The Islamic finance industry is centred in the Middle East and South-East Asia, but for the most part those regions have developed independently of each other. The past year, however, has seen a number of cross-regional sukuk, mostly by Gulf issuers tapping Malaysia’s highly liquid market, the world’s biggest for sukuk issuance. Malaysia’s sovereign wealth fund has also launched a Chinese yuan sukuk.