By Liau Y-Sing
KUALA LUMPUR, April 29 (Reuters) - New issuance of Islamic
bonds in Southeast Asia this year is likely to fall to around
levels last seen in 2003, depressed by weak corporate spending,
difficult pricing and poor demand, a Reuters poll shows.
Sales of new Islamic bonds, or sukuk, are expected to total
at least $4 billion this year, compared with an estimate of at
least $5 billion in a similar poll in January. The region sold
about $6.6 billion in new Islamic bonds last year.
Government issuance, similar to Indonesia's $650 million
sukuk issue earlier this month, would inject life into the
ailing market. And while there are signs the global economy is
stabilising, conditions are likely to remain dire until next
year, most of the survey's respondents said.
"Corporates are inclined to put their capital spending
plans on hold until more clarity on the economic front is
obtained," said Razlan Mohamed, chief executive of Malaysian
Rating Corp Bhd.
"Risk aversion on the part of investors still persists
given the continuous flow of negative economic data and this
will continue to weigh on the demand for new sukuk and
conventional issuances."
Half of the 12 surveyed in the Reuters poll predicted at
least $4 billion in new issuance of Islamic bonds this year,
three saw at least $5 billion, two at least $7 billion and one
at least $6 billion.
The last time regional sukuk issuance was near the $4
billion mark was in 2003 when it totalled $4.1 billion, data
from Islamic Finance Information Service (IFIS) shows.
New Islamic bond issuance in the region last year stood at
$6.6 billion, the lowest since $5 billion in 2004, IFIS said.
It said global sales totalled $15.77 billion last year versus
$46.65 billion in 2007.
"There will be a mismatch in the pricing since investors
will be expecting a higher yield in the current global
financial uncertainties," said Mohd Effendi Abdullah, director
of Islamic markets at AmInvestment Bank Berhad.
Malaysia's capital market regulator estimated on Tuesday
that global Islamic bond issuance this year would be worth at
least $10 billion, reflecting the global downturn and financial
uncertainty.
Malaysian central bank chief Zeti Akhtar Aziz recently said
there were signs of recovery in the sukuk market.
"We've seen some improvement now and there've been more
applications that have been submitted so there're quite a
number in the pipeline," she said. "We believe that we will see
sukuk issuance take place in the months to come."
Most issuance will be in Malaysia, Indonesia and Singapore,
the region's main sukuk markets, with governments and the
infrastructure and financial sectors likely to top the list of
issuers, the poll showed.
State-owned Islamic Bank of Thailand has said it will sell
200 million ringgit of mudaraba bonds in Malaysia, in what
would be the country's first Islamic bond.
Following are forecasts for expected new Islamic bond
issuance in Southeast Asia in 2009:
AmInvestment Bank at least $7 billion
Cagamas at least $7 billion
Malaysian Rating Corp at least $6 billion
Royal Bank of Scotland at least $5 billion
Elaf Bank at least $5 billion
OCBC Al-Amin Bank Bhd at least $5 billion
Mohammad Akram Laldin (scholar) at least $4 billion
Bank Islam at least $4 billion
CIMB Islamic at least $4 billion
Davide Barzilai (lawyer) at least $4 billion
Rodney Wilson (academic) at least $4 billion
Standard Chartered Saadiq at least $4 billion
MEDIAN at least $4.5 billion
(Editing by Neil Fullick)
- 
- 
- 
Welcome,
Guest!
News
