www.hurriyetdailynews.com -Turkish
participation banks are eager to begin issuing lira based sukuk
certificates, as Moody’s upgrades Turkey’s sukuk issue outlook to
positive with a ‘Ba1’ ratin.
Moody’s upgraded yesterday its outlook for Turkey’s sukuk issue to
positive and gave it a “Ba1” rating on the heels of news that the
Turkish Treasury had mandated three international banks – Citigroup,
HSBC and Liquidity House – to issue “sukuk certificates,” or Islamic
banking vehicles.
The new issue is expected to be completed in
two weeks as Turkish banks are eagerly waiting for the Turkish Treasury
to finalize the process for a Turkish Lira-based sukuk issuing
regulation. Deputy Prime Minister Ali Babacan had previously said on
several occasions that the Treasury was working to shape the regulation
before the end of 2012. (source)
‘Sukuk issue to attract foreign investors’
When asked by the Hürriyet Daily News
as to why the mandate was first given to foreign banks, Türkiye Finans
General Manager Derya Gürerk said he believed that the sukuk issue was
similar to the Treasury’s previous Eurobond issues and was geared more
toward attracting foreign investors.
“It’s only natural that to
reach a large foreign investor base and capital markets, the Treasury
mandated foreign banks,” he said in a written statement to the Daily
News. The bank is hopeful that there will be strong demand for the
Treasury’s new issue and that this, in turn, will speed up the sukuk
process in the Turkish market.
“Furthermore, this issue will
have a positive impact on foreign investor perceptions and, going
forward, we predict that sukuk issues by Türkiye Finans, as well as
other participation banks, will be able to attract a lot of interest,”
he said.
Feyzullah Eğriboyun, vice general manager of Bank Asya,
another leading Turkish participation bank, also commented to the Daily
News on the sukuk issue. “I hope that once our Turkish banks receive
the necessary know-how in this field, then we will be able to play a
role in issuing sukuks to other countries in the international arena,”
he said, calling the new issue both a “benchmark” and “road map” for
Turkey.
According to Eğriboyun, lira-based sukuk certificates
will provide participation banks with the opportunity to issue
securities that are in line with Islamic principles.
Ayhan
Keser, vice general manager of Albaraka, another Turkish participation
bank, said his bank was eagerly awaiting a lira-based sukuk issue.
“At
Albaraka, we are especially following developments regarding a Turkish
Lira sukuk issue and expect it to happen very soon. This issuance of
sukuk rent certificates are both a necessity and positive development
for all participation banks,” said Keser.
Source: http://www.hurriyetdailynews.com/moodys-move-whets-appetite-for-sukuk-certificates-in-liras.aspx?pageID=238&nID=29581&NewsCatID=344 - Sept 7, 2012
