The International Islamic Liquidity Management Corporation (IILM) has successfully conducted an auction for a total issuance of $900m short-term A-1 rated Sukūk in two series of 1-month and 3-month tenors, respectively.
The two issuances were priced by the market as follows: $400m of 1-month tenor at 0.22 percent; and $500m of 3-month tenor at 0.43 percent, respectively. The final profit rates of the two series lie below and within the indicative pricing guidance for the 1-month and 3-month series, respectively.
This demonstrates an increasing interest in high quality Sukūk from Primary Dealers and investors. The tender resulted in significant demand from Asian and Middle Eastern investors, with an orderbook that closed in excess of $1.59bn, representing an average oversubscription rate of 1.77 times.
With frequent monthly issuances throughout the year, the IILM has achieved a total cumulative issuance amount of $8.37bn year-to-date, amongst which $1.04bn are new issuances. This represents around 30 percent of the USD-denominated Sukūk year-to-date globally.
The IILM is committed to issuing regularly Shariah compliant liquidity instruments to satisfy the market demand and investors’ needs. The IILM short-term Sukūk programme is rated “A-1” by S&P.
The total of IILM Sukūk outstanding is $3.0bn. Headquartered in Malaysia, the IILM is an international organisation established in 2010 by central banks, monetary authorities and multilateral organisations to develop and issue short-term Shari’ah compliant financial instruments to facilitate effective cross-border liquidity management for institutions that offer Islamic financial services (IIFS).
The current members of the IILM Governing Board are the central banks and monetary agencies of Indonesia, Kuwait, Luxembourg, Malaysia, Mauritius, Nigeria, Qatar, Turkey, the United Arab Emirates, as well as the multilateral Islamic Corporation for the Development of the Private Sector.
Membership of the IILM is open to central banks, monetary authorities, financial regulatory authorities or government ministries or agencies that have regulatory oversight of finance or trade and commerce, and multilateral organisations.
Source The Peninsula