Global sukuk issuance exceeds RAM’s projection, Malaysia still leads

epa05550220 A general view of Kuala Lumpur skyline as seen from Kuala Lumpur Tower (KL Tower) in Kuala Lumpur, Malaysia, 21 September 2016. A research group expected a four percent growth for Malaysian Gross Domestic Product (GDP) in 2017 from 3.9 percent estimated in 2016. EPA/AHMAD YUSNI

KUALA LUMPUR: RAM Rating Services Bhd said global sukuk issuance as of end-November 2016 totalled US$72bil (RM319.9bil), surpassing its earlier projection of US$55bil to US$65bil (RM244.3bil to RM288.8bil) for the year.

In a statement on Monday, RAM said Malaysia retained its top spot with a 41.7% market share, followed by Indonesia (16.4%), the United Arab Emirates (11.0%), Turkey (7.1%) and Pakistan (6.7%).

The ratings agency noted that the corporate sector posted a 35.5% year-on-year jump in global sukuk issuance to US$30.6bil (RM135.9bil) as of end-September this year versus US$22.6bil (RM100.4bil) in the same period last year.

The top three issuers were originated from Malaysia, the UAE and Qatar, namely the Public Sector Home Financing Board (US$0.96bil), Emaar Sukuk Ltd (US$0.75bil) and the State of Qatar (US$0.72bil), respectively. 

A total of US$5.9bil of global sukuk was issued in September, bringing the year-to-date (YTD) issuance to US$58.9bil for the month.

RAM also highlighted that a total of RM9.6bil of domestic sukuk was issued in September, leading to a YTD issuance value of RM99.5bil.

“True to tradition, local-currency sukuk issues were dominated by the financial services and infrastructure and utilities sectors,” it said.

RAM head of Islamic finance, Ruslena Ramli, said large issuances from the financial and infrastructure sectors had been a boon to the sukuk market, and were likely to remain a key catalyst of future growth.

“As of end-November this year, the issuance value of domestic Islamic debt securities stood at RM125.3bil, exceeding RAM’s full-year projection of RM100bil to RM120bil,” she said. - Bernama