Business | Banking
QIB invests $343m in sukuk for debt market
Assets bound by an eight-year lease contract
- Zawya Dow Jones
- Published: 00:00 June 21, 2010
Dubai: Qatar Islamic Bank, or QIB, said Sunday it has invested 1.25 billion Qatari riyals ($343.2 million, Dh1.26 billion) in an Islamic lease sukuk issued by the country's central bank, as Doha attempts to develop its domestic debt market.
The investment has an eight-year lease contract that started on June 1, the bank said in a statement posted on the Qatar Exchange's website.
Qatar's government has guaranteed to repurchase the leased assets from investors at the end of the lease term, QIB said.
Qatar issued 5 billion riyals of bonds and 5 billion riyals of sukuks, or Islamic bonds, earlier this month in local currency to deepen the capital markets in the gas-rich state and create a benchmark yield curve which should help pave the way for other issuance.
A central bank official told Zawya Dow Jones in early June that nine Qatari banks will buy into the state's 10 billion riyals bond programme, with conventional lenders purchasing 1 billion riyals of paper each and Islamic banks subscribing to 1.25 billion riyals each.
Commercial Bank of Qatar, or CBQ, Doha Bank, Al Khaliji, International Bank of Qatar, or IBQ, and Ahli Bank will buy bonds from the government, while four Islamic lenders including QIB, Barwa Bank, Al Rayan and Qatar International Islamic Bank, or QIIB, will purchase sukuks, the official, who declined to be named, said.
QIB shares last traded flat at 73.10 riyals in a marginally positive overall market.
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