The Islamic Development Bank (IDB) will launch two sukuk by the end of the first half of the year.

By Victoria Robson

The first, a MYR500m ($156m) sukuk, has been approved by the IDB board and will finance projects in Malaysia.

The second could be issued in dollars or euros and is part of its medium-term note programme. It is expected to be worth $500m and will be used to fund the bank's general financing needs.

The bank has previously issued a $500m sukuk in 2005 and a $400m sukuk in 2003.

The IDB is also planning a second infrastructure fund. It will be at least as large as its first such fund, which raised $800m to invest in power generation, road and industrial projects in its member countries.

The IDB was established in 1975 to promote economic development in its member countries, which now total 56.

It has stakes in a number of sharia-compliant finance institutions as part of its remit to promote Islamic banking, including institutions in Sudan, Yemen and Bosnia-Herzegovina.

It is considering requests to support the establishment of new sharia-compliant banks in Uganda, Nigeria and Kyrgyzstan.