Jeddah-based Islamic Development Bank (IDB) is to launch a $1,000 million sharia-compliant, dollar-denominated medium-term note (MTN) programme, with the first drawdown due to be worth $500 million. A lead arranging team is close to being appointed.A five-year issue is likely, although the tenor will be finalised during bookbuilding. ‘The aim is to distribute the paper as widely as possible, and to see what new lines are available,’ says Dost Mohammed Qureshi of the IDB. ‘We want to see a wide cross-section of central banks, pension funds and institutional investors buying it.’ The notes will be listed in Luxembourg and Bahrain and possibly in Malaysia. Future drawdowns will be smaller, at anywhere from $50 million upwards, and will be spread over about two years. The funds raised will contribute towards $3,000 million of project spending planned by the IDB over the next five years. The bank plans to approach the financial markets for these requirements having already called in the funding contributions from member countries. The Islamic MTN is the first of its kind, but the IDB has entered the market for sharia-compliant securities before, launching a $400 million sukuk in August 2003 (MEED 1:8:03).