Saudi Arabia’s International Development Bank is planning to issue a sukuk (Islamic bond) early in 2010, according to bankers in the kingdom.

The deal will be the second issue under the bank’s $1.5bn sukuk programme, the first $850m of which was issued in September. Bankers say the issue will occur in the first quarter of 2010.

The sukuk will be used to help fund the banks plans to double the rate of lending over three years (MEED 23:10:09).

Speaking at MEED’s Capital Markets conference 2009, Mohammad Tariq, head of treasury at the bank, said that the bank needed to raise 7bn over the next five years to refinance existing debt and fund growth in lending.

The first $850m was underwritten by the UK’s HSBC and Deutsche Bank, France’s BNP Paribas, Bank Islam Brunei Darussalam.