International law firm Clifford Chance is advising the mandated banks arranging for Turkey’s debut sovereign Islamic bond, or sukuk, two sources familiar with the matter told The Brief on Thursday.
Turkey has mandated Citigroup, HSBC and Kuwait's Liquidity House to manage the sale of its first ever sovereign sukuk, as it seeks to tap a rich pool of investors flush with oil money. Banking sources told Reuters the dollar-denominated sukuk would be issued in the week of Sept. 17, but gave no further details.
Turkey, which has long maintained its secular stance, has increasingly sought to strengthen ties with its Gulf Arab neighbours. Participation bank Kuveyt Turk launched the country’s first sukuk in 2010 and the issue was well received, ushering in more issuances from other participation banks in the country.
But Turkey was yet to issue a sovereign sukuk, in part due to political concerns that such an issuance would give ammunition to critics who accuse Prime Minister Tayyip Erdogan’s government of seeking to roll back state secularism. This sovereign sukuk is expected to set a benchmark for future sukuk issues by banks and corporations.
Shaheen Pasha is Middle East Regional Editor at ALB. Follow us on Twitter: @ALB_TheBrief.
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