HSBC Takes Top Spot From CIMB in Sukuk Sales: Islamic Finance - BusinessWeek

HSBC Holdings Plc is overtaking CIMB Group Holdings Bhd. as the top underwriter of Islamic bonds as sales from the Gulf pick up and corporate issuance from Malaysia, the biggest market for the debt, declines.

HSBC, Europe’s biggest lender by market value, arranged $1.6 billion of global sukuk so far in 2010, about 25 percent of the total, led by Saudi Electricity Co.’s issuance in May, according to data compiled by Bloomberg. CIMB Group, Malaysia’s second-largest banking group, led $1.4 billion of sales of debt that complies with the religion’s ban on interest. Last year, CIMB was the top underwriter, managing $4.4 billion of offerings.

“The origin of the issuer may have an impact on the decision to hire which underwriter,” Azrul Azwar Ahmad Tajudin, chief economist at Bank Islam Malaysia Bhd., the country’s oldest Shariah-compliant bank, said in an interview in Kuala Lumpur yesterday. “If the issuance amount is huge, issuers may have some level of comfort with a foreign bank.”