Sukuk no longer primarily denominated in US dollars

One of the findings in the recent Standard & Poors report on sukuk is that the US Dollar is no longer one of the top currencies for new sukuk to be denominated in. The top two, according to S&P, are the UAE dirham (35.5%) followed by the Malaysian ringgit (33.2%, mostly sukuk for the Malaysian domestic market). The US dollar is third with 13.3% followed by the Saudi Arabian riyal with 12.2%. The weakness of the dollar and expectations that other GCC countries would follow Kuwait and end pegging their currency to the US dollar are attributed as the primary cause of this shift from US dollars to UAE dirhams. As the US dollar strengthens, sukuk are expected to be shifted back to dollar denominations, especially since many obligations financed by sukuk are denominated in US dollars.

The rupee-denominated Pakistani government ijara sukuk will mature in three years and be issued for PKR 10 billion ($130 million).

The Islamic Financial Services Board, the Malaysian-based standard-setting body, announced new members which include the financial services regulatory agency from South Korea.