Introduction
The Islamic finance market has demonstrated significant growth over the last decade, with global assets projected to reach approximately $3.69 trillion by 2024. One of the key components of this expansion is the issuance of Sukuk, particularly perpetual Sukuk, which offers a unique financing mechanism compliant with Islamic law. In 2022, the Sukuk market saw issuances exceeding $200 billion, with Tier 1 capital instruments gaining traction among financial institutions. This report focuses on Bond Perpetual Sukuk with no maturity, specifically detailing the Islamic Tier 1 securities set for 2026, highlighting key players and market performance.
1. Malaysia
Malaysia remains a leader in the Sukuk market, accounting for approximately 60% of global Sukuk issuances. The country issued over $50 billion in Sukuk in 2022, reflecting its robust Islamic banking sector and strong regulatory framework.
2. Saudi Arabia
Saudi Arabia has emerged as a significant player in the Sukuk market, with total issuances reaching around $30 billion in 2022. Its Vision 2030 initiative aims to diversify the economy, and Sukuk is a vital instrument for financing infrastructure projects.
3. Indonesia
Indonesia is a rising star in the Sukuk arena, with over $12 billion in issuances in 2022. The government’s commitment to Islamic finance is evident, as it seeks to use Sukuk for budget financing and infrastructure development.
4. United Arab Emirates
The UAE issued around $10 billion in Sukuk in 2022, making it a key player in the Gulf region. The country’s strong financial markets and regulatory environment bolster its position in the Islamic finance space.
5. Turkey
Turkey’s Sukuk issuances reached approximately $5 billion in 2022, showcasing the country’s potential in Islamic finance. The government is increasingly utilizing Sukuk to fund public projects, attracting both local and foreign investors.
6. Bahrain
Bahrain continues to play a crucial role in the Sukuk market, with issuances totaling around $4 billion in 2022. The country’s financial sector is well-established, making it a hub for Islamic finance and Sukuk transactions.
7. Qatar
Qatar’s Sukuk market saw issuances of about $3 billion in 2022. The country is focused on expanding its Islamic banking services, leveraging Sukuk for infrastructural and developmental financing.
8. Pakistan
Pakistan has been increasing its Sukuk issuances, reaching approximately $2 billion in 2022. The government employs Sukuk as a tool for financing its fiscal deficit and infrastructure development projects.
9. Egypt
Egypt’s Sukuk market is developing, with issuances of around $1 billion in 2022. The government is exploring Sukuk as a means to diversify its funding sources and attract foreign investments.
10. Oman
Oman has issued about $800 million in Sukuk in 2022, indicating its commitment to Islamic finance. The Sultanate is gradually integrating Sukuk into its public finance strategy.
11. Bangladesh
Bangladesh’s Sukuk issuances reached approximately $600 million in 2022. The country is keen on utilizing Sukuk for financing its infrastructure projects and enhancing financial inclusion.
12. Jordan
Jordan issued around $500 million in Sukuk in 2022, aiming to attract investments for infrastructure and social development projects. The country’s efforts in promoting Islamic finance are gaining momentum.
13. Morocco
Morocco’s foray into the Sukuk market saw issuances of around $400 million in 2022. The government is keen on diversifying its financing options through Islamic finance instruments.
14. Tunisia
Tunisia’s Sukuk market is nascent, with issuances of approximately $300 million in 2022. The country is exploring Sukuk as a financing tool to enhance its economic development.
15. Kuwait
Kuwait issued about $250 million in Sukuk in 2022, reflecting its commitment to Islamic finance. The country is looking to enhance its financial ecosystem with more Sharia-compliant products.
16. South Africa
South Africa’s Sukuk market saw issuances of around $200 million in 2022. The country is increasingly recognizing the importance of Islamic finance in attracting foreign investments.
17. Nigeria
Nigeria’s Sukuk issuance reached approximately $150 million in 2022. The Nigerian government is leveraging Sukuk for funding its infrastructural projects and enhancing its capital markets.
18. Sri Lanka
Sri Lanka’s Sukuk market is emerging, with issuances of about $100 million in 2022. The country is looking to tap into Islamic finance as a means to finance its development initiatives.
19. Maldives
The Maldives issued approximately $70 million in Sukuk in 2022. The government’s focus on sustainable tourism development has led to increased interest in Islamic financing options.
20. Brunei
Brunei’s Sukuk market is modest, with issuances totaling around $50 million in 2022. The country is exploring Sukuk to diversify its financing and enhance its economic stability.
Insights
The perpetual Sukuk market is gaining traction as corporations and governments increasingly seek sustainable financing options. The total value of Sukuk issuances globally is expected to exceed $300 billion by the end of 2023, driven by the growing demand for Sharia-compliant financial products. As financial institutions look towards Tier 1 capital instruments, perpetual Sukuk will likely play a crucial role in meeting regulatory capital requirements while adhering to Islamic principles. Additionally, with emerging markets beginning to explore Sukuk, the landscape for Islamic finance is projected to expand, providing more opportunities for investors and issuers alike.
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