Jaiz Bank Plc, Nigeria’s premier non-interest bank, plans to float a N150 billion Sukuk issuance, a trail-blazing effort that could redefine corporate non-interest bond issuance.
The planned Sukuk will be the largest non-interest bond issuance in the Nigerian capital market.
The board of directors of the bank has concluded preliminary discussions on the N150 billion Sukuk issuance and has scheduled consideration and approval of the N150 billion Sukuk as part of the agenda at the bank’s annual general meeting next month.
Shareholders are expected to authorise the board of directors to raise up to N150 billion new capital through issuance of Sukuk. The issuance may be at once or in tranches.
Shareholders are also expected to mandate the board of directors to take all necessary steps and transactions that would enable the bank to achieve its short to long-term growth objectives as well as greater competitiveness. These steps and transactions may include acquisitions, new investments, restructuring; expansion, capital raising and other business arrangements that enhance the bank’s growth trajectory.
S&P Global Ratings projected that total Sukuk issuances may be between $145 billion and $150 billion in 2022, slightly optimistic yew than the previous year.
According to the global rating agency, total Sukuk issuance stabilised at $147.4 billion last year compared with $148.4 billion in 2020 but foreign currency denominated issuance increased 10 per cent.
“We forecast total issuance of about $145 billion-$150 billion in 2022,” S & P Global Ratings stated.
The report noted that Sukuk issuance volumes would be flat at best in 2022 amid lower and more expensive global and regional liquidity, increased complexity, and reduced financing needs for some core Islamic finance countries.
“On a positive note, we see opportunities created by the energy transition in core Islamic finance countries, higher environmental, social and governance (ESG) awareness from regional issuers, and stronger automation using fintech solutions as likely to support future Sukuk market growth,” S & P Global Ratings stated.
Managing Director, Jaiz Bank Plc, Mr. Hassan Usman, had underscored the importance of Sukuk as a funding instrument for private and public sectors in the West African region and beyond.
Credit: thenationonlineng.net
