Khazanah to raise 500m yuan from five-year sukuk sale

Kuala Lumpur: Khazanah Nasional Bhd., Malaysia's state investment company, hired banks for a sale of the world's first yuan-denominated Islamic bonds, according to two people familiar with the matter.

BOC International, CIMB Group Holdings Bhd and Royal Bank of Scotland Group Plc are managing the sale of sukuk in Hong Kong, said the people, who asked not to be identified because the details are private. Khazanah is seeking to raise 500 million yuan (Dh288 million) from the five-year notes that pay returns derived from assets to comply with the religion's ban on interest, one person said.

"We don't comment on speculation," Khazanah spokesman Mohd Asuki Abas said when contacted by telephone.

The yuan-denominated sukuk comes after Khazanah sold S$1.5 billion of five-year Singapore dollar Islamic notes in August 2010.

The offering will help Malaysia strengthen its position as the world's biggest issuer of sukuk.

Malaysia, where about 60 per cent of the 29 million people are Muslim, is positioning itself as a global Islamic hub.