Islamic Finance

Islamic Development Bank issues $1.5 bln debut sustainability sukuk in response to COVID-19

The Islamic Development Bank issued a $1.5 billion 5-year sukuk with a profit rate of 0.908%, the multilateral said on June 19. The sukuk is part of IsDB's $25 billion sukuk programme. 

IsDB said the proceeds from its debut sustainability sukuk will go towards social projects under its Sustainable Finance Framework, with a focus on "access to essential services" and "SME financing and employment generation" under SDG 3: Good Health and Well-being and SDG 8: Decent Work and Economic Growth. 

The sukuk marks the second trade based on IsDB's Sustainable Finance Framework, which also served as the foundation on which it ssued its debut €1 billion Green Sukuk last November.

The allocation of the sale was 53% to investors in the Middle East and North Africa, 37% to Asia, 8% to Europe and 2% to other regions including U.S. Offshore. 

IsDB said that 79% was allocated to central banks and official institutions, 16% to bank treasuries and 5% to fund managers and private banks. 

The sukuk will be listed on Euronext Dublin, NASDAQ Dubai and Bursa Malaysia. 

The Joint Lead Managers and Joint Bookrunners for the issuance were Citi, Credit Agricole CIB, Emirates NBD, GIB Capital, HSBC, Islamic Corporation for the Development of the Private Sector (ICD), NATIXIS, Société Générale CIB and Standard Chartered Bank. Kuwait International Bank was the co-manager.

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