Islamic Finance

Islamic Development Bank issues 1 bln euros in debut green sukuk

The Islamic Development Bank on Nov 27 raised 1 billion euros in green sukuk.

The Shariah-compliant multilateral bank said in a statement on Nov 28 the 5-year sukuk was priced at a profit rate of 0.037%.

It was raised under IDB’s $25 billion sukuk programme.

The Saudi Arabia-based institution said proceeds from the issue will be channeled to climate change and green projects in its 57-member countries.

“These include projects for renewable energy, clean transportation, energy efficiency, pollution prevention and control, environmentally sustainable management of natural living resources and land use and sustainable water and wastewater management,” said the bank.

The sukuk was distributed to investors in the Middle East and North Africa (51%), 38% to Europe, 6% to Asia and 5% to other regions.

61% was allocated to bank treasuries, fund managers and private banks and 39% to central banks and official institutions, said IDB.

The sukuk will be listed on Euronext Dublin, NASDAQ Dubai and Bursa Malaysia.

The joint lead managers and joint bookrunners for the sukuk were Citi, First Abu Dhabi Bank, HSBC, Landesbank Baden-Württemberg, Natixis, Société Générale, Warba Bank, and Standard Chartered Bank.

This is IDB’s third public sukuk issuance this year.

The debut green sukuk is based on IDB's new Sustainable Finance Framework that was designed in line with its President Five-Year Program (P5P), and lays the foundation for it to issue green and sustainable sukuk to attract socially responsible and environmentally-conscious investors for financing the SDGs in IDB member countries.

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