CAPITAL MARKETS - SUKUK - Sukuk's new frontier - Istanbul heads new global hunger for Islamic bond

While Asia and the Gulf remain the two main hubs for sukuk bonds issuance, international players recovering from the global financial crisis and on the prowl for investment have begun experimenting with the financing tool. The most recent entrant to the sukuk market is Turkey, long seen as a prime candidate for the development of Islamic financial products. Its foray into sukuk (a sharia compliant investment tool) was well received, though a sovereign placement could still be a ways off as the Turkish government cautiously adopts Islamic finance legislation.

SUKUK - Kuveyt Turk Plans Second Sukuk as Market Grows: Islamic Finance

Aug. 30 (Bloomberg) -- Kuveyt Turk Katilim Bankasi AS is spearheading Turkey’s five-month-old Islamic bond market, planning a second sale of Shariah-compliant debt for 2012.

Kuveyt Turk, the Istanbul-based bank owned by Kuwait Finance House KSC, may sell more than $100 million of five-year sukuk, after a similar size sale in August that was the first in the nation since regulators allowed companies to offer Islamic bonds, said Chief Executive Officer Ufuk Uyan. The government is considering selling sukuk “in the future,” Finance Minister Mehmet Simsek said in an interview with Bloomberg HT television on Aug. 25.

“We’re targeting investors from the Middle East, Europe and Asia,” Uyan said in an interview from Istanbul on Aug. 25. “Everyone was expecting a sovereign sukuk from the treasury, but we wanted to pave the way as a bank.”