Brunei sells $165 million worth of sukuk

BRUNEI DARUSSALAM has sold $165 million (US$109 million) of Islamic leasing bonds, the government said.

The Ministry of Finance said in a statement that the government had issued $31 million of 91-day notes at a rental rate of 0.40 per cent and $60 million of 91-day notes at 0.39 per cent.

It also sold $11 million of one-year paper at 0.50 per cent and $63 million of 91-day notes at 0.34 per cent.

The statement was dated March 19 but was released to media only yesterday.

With these issuances, the Brunei government has sold $1.5 billion of short-term ijara or rental bonds since its first offering in 2006, the ministry said in a statement.

Islamic bonds do not pay interest, which is banned as usury under Islamic law, and are structured as profit-sharing or rental agreements underpinned by physical assets.

The Sukuk Holding Properties Inc and Sukuk (Brunei) Inc were set up by the ministry and registered under the International Business Companies Order 2000 to act as conduits for the government to issue sukuk or Islamic financial certificates beginning in April 2006.Reuters