IFC Launches $100 million Sukuk to Support Private Sector Development

Lagos, Nigeria, Capital Markets in Africa — IFC, a member of the World Bank Group, announced today that it issued a $100 million trust certificates through a special purpose vehicle, IFC Sukuk Company, in an effort to spur growth in developing economies.   

The five-year Sukuk will support IFC’s developmental financing activities in the Middle East and North Africa (MENA), and other parts of the world. It will initially be listed on NASDAQ Dubai. An application has also been made to list the Sukuk on the London Stock Exchange. The transaction will be IFC’s second Sukuk issuance. 

“We are pleased to be part of this landmark Sukuk issuance by IFC, which achieved the tightest pricing for a dollar-denominated Sukuk. The issuance supports the growth of the Islamic finance and Sukuk industry beyond its traditional borders,” said Ahsan Ali, Managing Director and Head of Islamic Origination at Standard Chartered Bank. 

“As a non-Islamic multilateral, IFC’s Sukuk is expected to help deepen the Sukuk market in the countries of the Gulf Cooperation Council, sending a positive signal for the development of the Gulf region’s markets,” said Mouayed Makhlouf, IFC Director for the Middle East and North Africa. 

Bahar Alsharif, IFC Deputy Treasurer, said: “This issuance will help meet the funding needs of our private-sector clients in the Middle East and globally. As a premium global issuer, IFC is keen to offer international and regional investors high-quality alternatives in Islamic financial markets.” 
  
IFC, an AAA-rated global financial institution, carried out its first Islamic finance investment in 1995, supporting a leasing project in Pakistan. To date, IFC has approved about 28 Islamic financing transactions worth a total of $742 million. 

IFC Sukuk Summary Terms and Conditions 
Issuer: IFC Sukuk Company
Obligor: International Finance Corporation (IFC)
Rating of Obligor: AAA Moody’s/ AAA S&P
Exp. Issue Rating: AAA by S&P
Sukuk Structure: Sukuk al Wakala
Format: Reg S only
Tenor: 5yrs amortizing; WAL: 3.75yrs
Size: $100mn 
Profit Rate: 6-month $ Libor minus 10 basis points 
Listing: Nasdaq Dubai and London Stock Exchange (LSE will be subsequent to issuance)
Joint Lead Managers: Dubai Islamic Bank, HSBC, National Bank of Abu Dhabi and Standard Chartered Bank (B&D) 
Investor breakdown: 75% Banks, 20% Official Institutions, 5% Fund Managers 

Source: IFC, Middle-East North Africa webpage