IDB to an­nounce sukuk road­show this week

Kuwait Times - - BUSINESS -

The Is­lamic Devel­op­ment Bank (IDB) will an­nounce this week plans for in­vestor road­shows cov­er­ing its planned sukuk sale, bankers fa­mil­iar with the sit­u­a­tion told Reuters. The is­sue, ex­pected to be in ex­cess of $1 bil­lion, is one of the few re­main­ing debt sales likely to be com­pleted in the Mid­dle East be­fore the end of this year, as the win­dow to pre­pare new bonds shrinks and as mar­ket volatil­ity puts in­vestors in a de­fen­sive mode, bankers and in­vestors said.

The IDB did not re­spond to an emailed re­quest to com­ment. It man­dated nine banks for the Is­lamic bond sale in late Oc­to­ber, with the aim of is­su­ing the sukuk af­ter the US elec­tions on Nov 8.

But the un­ex­pected vic­tory of Don­ald Trump in the US pres­i­den­tial elec­tion last week caused the IDB - as well as other po­ten­tial debt is­suers in the Mid­dle East - to wait a bit longer to as­sess the im­pact of Trump’s vic­tory on the re­gional bond mar­ket, bankers said.

“The deal would have gone out ear­lier if Clin­ton had won,” said one. Some Mid­dle East­ern bond trans­ac­tions for which banks had al­ready been man­dated have been put on hold be­cause of the mar­ket turmoil caused by Trump’s win, and new man­dates for is­sues that could have taken place af­ter a Clin­ton vic­tory have been frozen, bankers said. Po­ten­tial bor­row­ers have de­cided to wait un­til Jan­uary to see how mar­kets per­form. An in­ter­est rate hike by the US Fed­eral Re­serve Bank in De­cem­ber seems likely, and the mar­ket has al­ready priced that in, “so what’s the ad­van­tage in is­su­ing now rather than in Jan­uary?” said the banker. —Reuters

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