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Islamic bond sales may grow to 11 billion pounds
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Global sales of bonds that comply with Islamic law may grow as much as 30 percent to $22 billion this year, led by booming Middle Eastern economies, according to Barclays Bank. Sales of the bonds, which comply with the Islamic ban on the receipt of interest, reached $18 billion last year.
But sales this year could range from $20 to $22 billion as Arab governments and companies seek to tap rising demand among the world's 1.2 billion Muslims for investments that comply with their religious beliefs. Barclays helped arrange the sale of $3.52 billion worth of Islamic bonds for the Dubai-owned Nakheel Group, the biggest sale of its kind.
Some investors offered as much as $6 billion for the bonds. And European investors took up to 40 percent of the sale, with investors in the Middle East taking 38 percent of the sale, according to the Dubai Islamic Bank.
The growing demand for Islamic bonds may boost the average size of “sukuk” sales this year to between $300 and $500 million, from about $50 million to $200 million in 2006.
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