- Saudi Arabia-based Islamic Development Bank raises its medium term sukuk ceiling to $25bn
- Increased financing to support growing demands in member countries
The Saudi Arabia-based Islamic Development Bank (IDB) has decided to raise the limit on its medium-term sukuk (Islamic bond) programme from $10bn to $25bn.
IDB plans to issue a $1bn sukuk every year, according to Reuters, with varied maturity dates to build a wider yield curve. This will help it fund long-term infrastructure projects.
It raised the ceiling to $10bn and tripled its authorised capital to $150bn in 2013.
IDB has an AAA rating, the highest available, and a stable outlook, from all three major ratings agencies. It sees high demand for its sukuk issuances.
The bank has decided to reintroduce its medium term sukuk issuance programme which is in line with the provisions and principles of the Islamic Sharia, with the aim of mobilizing and injecting new financial resources from the international money market to meet the growing development needs in member countries, it said in a press release.
The $10 billion so far raised as part of the IDBs sukuk programme have been used to finance various development programmes in member countries, particularly infrastructure projects.
The IDB has agreed to finance a number of major projects in the Middle East in the last year.
Selected IDB financed projects:
- The Egypt-Saudi electricity transmission link ($200m)
- Dualisation of Al-Kamil-Sur road ($225m) Oman
- West Damietta ($201m), South Helwan ($450m) and Assiut ($220m) power plants Egypt
- Sharm el-Sheikh airport upgrade ($457m) Egypt
- Wadi Dayqah water supply scheme ($176m) Oman