Issuer: Islamic Development Bank
Size: $400 million
Bookrunner: Citigroup
July 29 2003
The Islamic Development Bank’s five-year fixed-rate $400 million debut Eurobond has taken Islamic finance another step forward. Not only does it further underscore the demand for such bonds among both Islamic and conventional institutions, it is the first time an Islamic bond, which has to be asset backed, has been backed by a pool of assets, paving the way for greater flexibility for shariah-compliant issuers.
Underlying issue Money has no intrinsic value in Islamic finance, so bonds have to represent a real underlying asset.
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