The International Islamic Liquidity Management Corporation (IILM) has issued three new sukuk worth US$490 million, bringing its total outstanding sukuk to US$4 billion, the highest level so far.
The latest issuance, with tenors of one month, three months, and six months, reflects the group’s commitment to providing high-quality liquidity management tools to the global Islamic financial market, the IILM says.
The series was priced competitively at 5.40% at US$240 million for the one-month tenor; 5.20% at US$150 million for the three-month tenor; and 5.00% at US$100 million for the six-month tenor.
The latest issuance marks the IILM’s ninth auction for the year as well as its second in August.
Mohamad Safri Shahul Hamid, chief executive officer of the IILM, says: “Today’s new sukuk issuance represents a significant milestone for the IILM, as we expand our portfolio to include a new highly rated underlying asset for the first time since 2020 (rated AA- internationally). This brings the IILM’s total outstanding sukuk to US$4 billion, which is the highest-ever since the inception of the IILM sukuk programme in 2013."
The group’s two sukuk issuances in August 2024 totalled US$1.75 billion, the biggest total monthly issuance recorded by the IILM for this year. “This further underscores the strong and growing market confidence in the IILM’s high-quality Islamic papers, as evidenced by the steady increase in the number of new investors, including from a new Islamic account from Indonesia for [the latest] issuance,” Safri adds.
Strong demand
Despite a volatile market environment, characterized by uncertainty over the US Federal Reserve’s upcoming interest rate decisions, the latest auction attracted robust interest from primary dealers and investors across the Gulf Cooperation Council, Europe, Asia, and Africa. The combined order book exceeded US$1.06 billion, resulting in an average bid-to-cover ratio of 217%.
Year-to-date, the IILM has raised a cumulative US$8.38 billion across 27 sukuk issuances. The group’s short-term sukuk programme holds strong ratings of “A-1” from S&P Global Ratings and “F1” from Fitch Ratings.
The IILM regularly issues short-term sukuk across one-month, three-month, six-month, and 12-month tenors to cater to the liquidity needs of institutions offering Islamic financial services.
The programme is distributed by a diversified network of 11 primary dealers globally, namely Abu Dhabi Islamic Bank, Al Baraka Turk, Affin Islamic Bank, Boubyan Bank, CIMB Islamic Bank Berhad, Dukhan Bank, First Abu Dhabi Bank, Kuwait Finance House, Maybank Islamic Berhad, Qatar Islamic Bank, and Standard Chartered Bank.
The IILM is an international organization founded in October 2010 by central banks, monetary authorities, and multilateral organizations to develop and issue short-term Shariah-compliant financial instruments to facilitate effective cross-border liquidity management for institutions that offer Islamic financial services.
