JEDDAH - The Islamic Development Bank plans to issue Islamic bonds (Sukuk), worth a total of $5 billion over this year and the four following years, its president said on Tuesday.
“We hope that we can mobilize $1 billion every year beginning in 2010 and for a period of five years,” IDB President Ahmed Mohamed Ali told Reuters.
The planned Sukuk would beef up the capability of the triple-A lender to allow it to increase lending to soften the impact of the global financial and economic crisis on some of its 56 member countries, many of them poor states in Africa, he added. “We plan to raise $1 billion every year and for five years from 2010. The issue would be sukuk and the maturity is normally for five years,” Mohamed Ali added.
“The Sukuk will be issued on the capital market and open for all investors in Asia and Europe and elsewhere,” he said.
The IDB has granted more than $56 billion in loans to poor member states over the past three decades, including $4.8 billion in 2008, according to the latest figures. “The board directors of the bank had demanded that it increase its financing to its member countries affected by the crisis. To have these resources, we will go to the market and raise more financial resources,” he said.
The IDB plans to expand lending to its member states by 30 percent in the three years to 2011. – Reuters