Bloomberg | Brief » Islamic Finance

Malaysian Yields at 4-Month High on Food Costs

ekrutoholow — Mon, 17 Sep 2012 12:57:35 +0000

Malaysia’s Islamic borrowing costs increased to a four-month high on concern rising food prices will drive up the lowest inflation in Southeast Asia, as the government raises spending before next year’s elections.

Yields on 10-year sukuk rose 20 basis points this month to 3.69 percent, after reaching a record low of 3.48 percent on July 26, according to Bursa Malaysia. In Indonesia, rates on similar-maturity debt fell 32 basis points to 6.22 percent. Investors submitted bids for 1.68 times the 4 billion ringgit ($1.3 billion) of 2022 Islamic bonds on offer at an auction on Sept. 13, the least since March 2011, central bank data show.

Saudi Hollandi to Pay Less Than Fransi in Sukuk Sale

ekrutoholow — Mon, 17 Sep 2012 12:55:46 +0000

Saudi Hollandi Bank will probably be able to sell Islamic bonds more cheaply than other issuers in the largest Arab economy as a dearth in debt issuance in the past two months boosts demand for the notes.

The board of the Riyadh-based bank, which is 40 percent owned by ABN Amro Holding NV, approved sukuk valued at 1.4 billion riyals ($373 million), it said Sept. 9. The yield could be around 2.25 percent for five-year notes, said Akber Khan, director of asset management at Al Rayan Investment in Doha. That compares with the 2.947 percent Banque Saudi Fransi paid in May for its five-year sukuk and a rate of 2.5 percent for state-run General Authority of Civil Aviation’s Islamic bonds maturing in January 2022.

Spread Between Dubai, Malaysia Sukuk at All-Time Low

Bloomberg Brief — Mon, 10 Sep 2012 18:26:38 +0000

Guggenheim Progress Cuts TDIC Yield to Record

Bloomberg Brief — Mon, 03 Sep 2012 14:40:17 +0000

Improved prospects for the completion of branches of the Guggenheim and Louvre museums in Abu Dhabi have helped drive Tourism Development & Investment Co.’s Islamic bond yield to a record low as the emirate’s property market recovers.

The yield on the 4.949 percent sukuk due October 2014 declined 92 basis points this year to 1.96 percent on Aug. 29. The rate, which rose to 1.97 percent on Aug. 30, reached a seven-month high on Nov. 25 after state-owned TDIC said it will delay completing the museums. The average yield on sukuk in the United Arab Emirates fell 73 basis points this year to 3.8 percent, according to the HSBC/Nasdaq Dubai UAE US Dollar Sukuk Index.

Indonesia Sukuk Yields at 7-Month High on Rupiah

Bloomberg Brief — Mon, 03 Sep 2012 14:38:24 +0000

Indonesia’s Islamic bond yields rose to a seven-month high as the biggest current account deficit since at least 1997 helped make the rupiah Asia’s worst-performing currency this quarter.

The yield on the 7.13 percent rupiahdenominated notes due October 2014 climbed 33 basis points in August to 5.99 percent, the highest level since Jan. 16. In Malaysia, yields on similar-maturity sukuk dropped one basis point to 3.17 percent. The rupiah has lost 1.5 percent since June and options traders are betting it will have the widest swings in the coming year.

Saudi Electricity Gains Outpace GCC on Scarcity

Bloomberg Brief — Mon, 13 Aug 2012 15:28:38 +0000

Saudi Electricity Co.’s Islamic bonds returned 67 percent more than Persian Gulf corporate sukuk, buoyed by a scarcity of Shariah-compliant securities in Saudi Arabia and demand for investmentgrade debt.

The state-controlled utility’s 4.211 percent dollar-denominated notes maturing in April 2022 have gained 9.5 percent since their debut at the end of March. That compares with a 5.7 percent return on corporate sukuk from the six-nation Gulf Cooperation Council, the HSBC/Nasdaq Dubai GCC Corporate US Dollar Sukuk Index shows. The yield on the Saudi Electricity’s notes dropped to a record 3.1 percent Aug. 7. The kingdom’s largest power producer is rated the fourth-best investment grade at Standard & Poor’s.

Dubai Sukuk Premium to Malaysia Falls to Record

Bloomberg Brief — Mon, 13 Aug 2012 15:26:38 +0000

The yield premium investors demand to hold Dubai’s unrated Islamic bonds over Malaysia’s tumbled as much as 50 percent this year to a record as the emirate’s state-linked companies settle debt and economic growth accelerates.

The spread on Dubai’s 6.396 percent sukuk due November 2014 over Malaysia’s investment-grade 3.928 percent notes maturing in June 2015 fell 137 basis points this year to 149 on Aug. 8, according to data compiled by Bloomberg. The premium reached a record 142 on July 30. The yield on the emirate’s sukuk dropped 234 basis points this year to 3.23 percent on Aug. 7.

Persian Gulf Yield Advances Most in Six Months

Bloomberg Brief — Mon, 21 May 2012 16:32:47 +0000

The average yield on Islamic bonds in the Persian Gulf last week jumped the most in six months as concern over Europe’s debt crisis triggered a sell-off of riskier assets and pushed oil prices lower.

Sukuk yields in the region rose 15 basis points last week, the most since the week ended Nov. 18, to 4.1 percent, the HSBC/NASDAQ Dubai GCC US Dollar Sukuk Index shows. The spread between the average yield for Gulf sukuk and Libor advanced for a forth week, soaring 16 basis points in the period to 295 basis points, the index shows.

Dubai Sukuk Yields Drop to Record on Jafza, IPIC

Bloomberg Brief — Mon, 07 May 2012 16:36:54 +0000

The yield premium investors demand to hold Dubai’s unrated Islamic bonds over Malaysia’s declined to a record after the emirate’s state-linked companies made progress in settling $15 billion of debt due this year.

The spread on Dubai’s 6.396 percent sukuk due November 2014 over Malaysia’s investment-grade 3.928 percent notes maturing in June 2015 has fallen 98 basis points this year to 189 on May 4, according to data compiled by Bloomberg. The premium reached a record 188 basis points on May 3. The yield on the emirate’s sukuk dropped 180 basis points this year to 3.77 percent.

Zeti Spurning Rate Cut May Halt Malaysia Rally

Bloomberg Brief — Mon, 05 Mar 2012 16:43:43 +0000

The rally in ringgit-denominated Islamic bonds that pushed yields to an eight-month low will end after the central bank ruled out a cut in interest rates, according to CIMB Group Holdings Bhd. and RHB Capital Bhd.

Yields may rise after Bank Negara Malaysia Governor Zeti Akhtar Aziz said in an interview that the benchmark policy rate of 3 percent is supportive of economic growth ahead of a March 9 review, RHB Capital and CIMB Group say. Yields on 3.505 percent notes due in September 2014 dropped for a third month in February and have fallen 33 basis points to 3.14 percent from a June 30 peak, according to Bursa Malaysia.