Reuters - July 11, 2008
An Indonesian parliamentary working committee approved the government's plan to issue Islamic bonds, also known as sukuk, late on Thursday, clearing the way for issuance in the domestic and global market this year. Here are some details about the sukuk.
* currency: rupiah-denominated sukuk to be sold in the domestic market and dollar-denominated sukuk abroad.
* timetable: August for the domestic issue and October for the international sukuk.
* underlying assets: 18.371 trillion rupiah ($2.01 billion) of finance ministry land and property assets will back the bonds.
* proceeds: will be used to finance the state budget.
* structure of contract: Ijarah sale-and-leaseback, where the sukuk is backed by the purchase, sale or lease of physical properties.
* maturity: the government can set the debt maturity and has previously said it is looking to borrow for seven to 10 years.
* return: fixed coupon rate
* the parliamentary working commission also approved the government's plans to issue the following instruments: long-term sukuk Al Ijarah, retail sukuk, Islamic treasury bills, sukuk for project financing, and exchangeable sukuk. ($1=9,154 rupiah)
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