Islamic financial products may not be an obvious first port of call for investors in troubled times. But sukuk – or ‘Islamic bonds’ – are witnessing sustained demand despite the political upheavals of the Arab Spring-turned-summer and the recent volatility that has hit the global markets.
“We’ve seen a good pick up in activity in the past months and notably, at the height of market volatility”, Mohammed Dawood, head of Islamic capital markets at HSBC, told beyondbrics.
Last month, Malaysia, the world’s largest issuer of sukuk, announced a $2bn global sukuk offering – the largest Islamic bond offering since December 2007 – while the First Gulf Bank in Abu Dhabi saw the $650m sukuk it issued earlier this month oversubscribed six times.
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