Malaysia’s sukuk issuance exceeds projection for 2018

KUALA LUMPUR: RAM Ratings ServicesBhdsaidMalaysia’ssukuk issuance as of end- September 2018 totalled RM123.9 billion, surpassing its earlier projection of RM100 billion–RM120 billion for the year.

In a statement here, the rating agency said a total of RM24.9 billion sukuk was issued in the third quarter of 2018.

The growth was led by an increased issuance by the government (+17.0 per cent or RM46.5 billion) despite a 41.8 per cent decline for the corporate sector, it added.

It said the Malaysian sukuk market expanded 11.1 per cent year- on-year to RM827.8 billion as at end- September 2018

We expect the growth of global sukuk issuance to stay muted in 2018, potentially falling below our projection of US$75.0 billion-US$85.0 billion for the year.

( end- September 2017: RM745.2 billion).

At the same time, the proportion of outstanding sukuk relative to the overall domestic bond market remained robust at 59.8 per cent.

Meanwhile, the latest issue of RAM’s Sukuk Snapshot reports that total global sukuk issuance shrank 12.2 per cent y- o-y to US$ 66.8 billion as at endSeptember 2018, from US$ 76.1 billion a year earlier.

That said, Malaysia maintained its dominance with a 35 per cent share of global sukuk issuance, followed by Saudi Arabia (26.5 per cent).

Ringgit- denominated sukuk maintained its leadership with a 32.2 per cent share of the global sukuk market.

“We expect the growth of global sukuk issuance to stay muted in 2018, potentially falling below our projection of US$ 75.0 billionUS$ 85.0 billion for the year,” said RAM Ratings. — Bernama