Reports coming from Qatar suggest the sheikhdom is planning to issue sukuk (Islamic bonds) for the first time in nearly a decade amid growing global demand for safe havens and sharia-compliant assets.
Doha has mandated banks for investor meetings in Kuala Lumpur and Singapore starting on 9 July, Reuters quoted arranging banks as saying on Thursday. The report added that a dollar-denominated sukuk issue may follow subject to market conditions.
The world’s top liquefied natural gas (LNG) exporter has not issued a sukuk since 2003.
“Qatar is an extremely well-known name in the bond market, and its existing bonds are very liquid and trade frequently, so appetite, particularly from international investors for Qatari paper is huge,” Chavan Bhogaita, head of the markets strategy unit at National Bank of Abu Dhabi, told Reuters.
“In addition, the rarity value of having sukuk paper from a blue-chip issuer such as Qatar sovereign will certainly help to ensure a very healthy order book.”
Qatar, which enjoys a AA-rating, seeks to tap solid demand from abundant Islamic and non-Islamic liquidity in the wake of successful recent deals in the region.
The gas-rich nation’s banking sector is gaining courage from this week’s $500 million Emirates Islamic Bank sukuk deal, of which about 30% was allocated to Asian accounts.
The Bahraini government and Dubai’s Majid al Futtaim Holding also stuck oversubscribed deals last week, which indicated a growing international bid for regional debt.
Qatar has hired HSBC Holdings, Deutsche Bank , Standard Chartered Plc and local lenders Barwa Bank and QInvest to arrange the investor meetings, Reuters report disclosed.