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- IILM Moves To Build Sales Network After Sukuk Debut
- Asia Naphtha-Russia Offers Up To 1.2 Mln T In Rare 12-Mth Deal
- Southeast Asia Stocks-Indonesia Rebounds In Negative Week
| IILM Moves To Build Sales Network After Sukuk Debut Posted: KUALA LUMPUR: Primary dealers of the International Islamic Liquidity Management Corp (IILM) said after enjoying healthy demand for its debut Islamic bond last week, efforts were shifting to expand the distribution network of buyers. The $490 million, three-month sukuk was auctioned to seven primary dealer banks, as the IILM aims to address a shortage of financial instruments for Islamic banks to manage their short-term funding needs. With the structure and approvals now in place, Malaysia-based IILM can shift its focus to establishing regular issuance, decide on future tenors and possibly expand its network. "Ideally one of the next steps would be to develop an issuance calendar. They will develop a plan in relation to the other tenors," said Leon Koay, head of global markets and co-head of wholesale banking at Standard Chartered Malaysia, one of the seven primary dealers. "They've been approved for $2 billion, they've got plenty of runway. With this landmark issuance out of the way, the rest of it would be easier." A key element of the IILM, backed by nine central banks and monetary agencies as well as the Islamic Development Bank , is a network of dealer banks that ensure a secondary market for sukuk. "As primary dealer, we are obliged to participate in all auctions conducted by IILM and at best, try to be the market maker for the sukuk," Aria Putera Ismail, head of Islamic global markets for Maybank Islamic, told Reuters. "The market in general is still short of Islamic assets. Hence, we expect that there will be continuous demand from investors for such instruments." CLARITY With the sukuk now trading in the open market, prospective buyers can observe the bid-ask spreads which reflect liquidity in the market for IILM paper. On Thursday, the first IILM sukuk had a sample best bid of 0.608 (for a block of $5 million) with a sample best offer of 0.525 (also for $5 million). "This shows a perfectly normal and healthy secondary market," said Jonathan Grosvenor, general manager of global financial markets at KBL European Private Bankers, the Luxembourg-based primary dealer for IILM. The remaining IILM primary dealers are Kuwait Finance House , AlBaraka Turk, National Bank of Abu Dhabi and Qatar National Bank. The sukuk was sold to primary dealers at 30 basis points over the London interbank offered rate, seen as attractive pricing for primary dealers to create a secondary market. That spread was set by the IILM for the launch but going forward it would be determined according to the auction process by primary dealers, Grosvenor added. As the market gains a better understanding of how the IILM works, it could also attract a wider range of buyers. KBL, for instance, has reached out to Islamic asset managers and other regular buyers of such instruments in Europe, said Grosvenor. "We haven't made any calls to the Middle East and in a way we are very complementary to IILM, we are adding something different." Better understanding of the IILM's structure could help to market its offerings. The IILM uses a wakala structure, according to a filing with Malaysia's central bank. Wakala is a sharia-compliant agency agreement where one party acts as agent (wakil) for another. In a wakala sukuk, certificates are issued by an originator to buy specific assets, which in turn are given to a wakil for management, which charges a fee for its services. The originator undertakes to buy the assets at maturity at an agreed price.- Reuters |
| Asia Naphtha-Russia Offers Up To 1.2 Mln T In Rare 12-Mth Deal Posted: SINGAPORE: Russia's Rosneft has offered up to 1.2 million tonnes of naphtha in a rare 12-month contract starting October 2013, traders said. The up to three tanker-sized cargoes a month will come from Rosneft's Angarskiy and Komsomolskiy plants and will be exported through the port of Nakhodka, which is nearer to Asia than to Europe. The tender for the year-long contract - to start from Oct. 15, 2013 - will close on Sept. 9. Bids will be valid until end-September. "Rosneft usually offers a 6-month contract," said a Singapore-based trader. "It is unclear why they are going for a one-year term when this is not a good time for sellers to lock themselves in for a longer period." The Asian naphtha market is currently marked by surplus cargoes and it will take time for this to ease. Some traders expect the glut to clear from end-October, while others have said it will last until at least the second-half of November. Rosneft has an existing 6-month contract to sell up to a total 400,000 tonnes of naphtha for May to October loading from Nakhodka to Japan's JX Nippon Oil & Energy Corp and Malaysia's state-owned refiner Petronas. It recently sold a rare spot naphtha cargo to Japan's JX Nippon Oil & Energy Corp. Rosneft also exports naphtha from Tuapse but these cargoes usually head to the Mediterranean. Its Tuapse refinery recently added a new crude unit, raising its total throughput by almost three times- Reuters |
| Southeast Asia Stocks-Indonesia Rebounds In Negative Week Posted: BANGKOK: Southeast Asian stocks rose on Friday as players sought bargains from the beaten-down emerging equities but broad appetite remained weak ahead of U.S. jobs data. Jakarta's Composite Index reversed earlier losses to close up 0.5 percent as the rupiah's spot rate on Friday was seen 4.17 percent stronger from the opening price. The gain helped trim the benchmark's weekly loss to 2.9 percent, still Southeast Asia's worst performer. Indonesia's central bank released data after market close, showing foreign exchange reserves rose slightly in August. Recent declines in the reserves were among market concerns. Regional sharemarkets staged a mild rebound in the first week of September following a plunge in August amid rising risk aversion and concerns about a potential cut in monetary stimulus in the United States. Among outperformers, Thai SET index climbed 1.7 percent on the day and 3.2 percent on the week. Singapore's key index edged up 0.3 percent on the day, ending the week 0.6 percent higher after four weeks of falls. Across exchanges, stocks with greater exposure to improving global outlook and some battered blue chips were actively bought, including Maybank, Keppel Corporation , Kasikornbank and SM Investments Corp . For Asian Companies click; For South East Asia Hot Stock reports, click; SOUTHEAST ASIAN STOCK MARKETS Ho Chi Minh 46,817 42,928 - Reuters |
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