Sukuk Issuance To Grow Once Mart Conditions Return To Normal, Says RAM

Bernama: RAM Rating Services Bhd expects the sukuk issuance to resume its impressive growth once the market conditions return to normal, fuelled by huge investment and financing needs especially in the Gulf and Asian countries.

Its managing director/chief executive officer, Wong Fook Wah, said the sukuk growth has been slowed in the past six months due to unfavourable credit market condition.

"Once confidence comes back, and we expect that to happen maybe six to nine months down the line, sukuk issuance is expected to resume its dominant trend and then go back to double-digit growth," he told reporters after the launch of "The Malaysian Sukuk Market Handbook -- Your Guide to the Malaysian Islamic Capital Market," by Raja Muda of Perak Raja Nazrin Shah here today.

As at end-2007, total sukuk that originated from Malaysia totalled RM213 billion, which constitued 68.9 percent of the global outstanding sukuk.

In 2007, RAM rated 87 percent of the total sukuk issued in ringgit bond market totalling RM34.4 billion.

Meanwhile, RAM chairman, Tan Sri Siti Norma Yaakob, said the handbook was a comprehensive guide that would serve as a reference for institutions and professionals keen on unlocking maximum value from the domestic Islamic capital market.

She said the rating agency was confident the handbook would become a practical guide and reference and lead to greater participation among intellectuals, professionals and investors while encouraging more innovation and origination of Islamic financial products.

"The handbook is expected to reach the circulation and readership of chief executive officers, chief financial oficers, finance directors and treasurers responsible for financing and capital-raising for domestic and foreign corporations," she said