27four Investment Managers
8th December 2014
Islamic Finance: SA’s sukuk triumph
When national treasury made its debut on the global sukuk market in September, SA became a member of an elite group.
It became the third non-Islamic country to issue a sovereign sukuk, joining the UK and Hong Kong, which also made their debuts this year.
Sukuk, the Islamic equivalent of a bond, complies with sharia law, which prohibits payment or receipt of interest. Instead, sukuk investors are paid non-interest income from physical assets such as property and infrastructure.
A resounding success, SA’s US$500m, 5.75-year sukuk attracted bids of $2.2bn. Though small by global issuance standards, the sukuk has “huge significance”, says Oasis Group CE Adam Ebrahim. “It has put SA on the global sukuk map.”