The best sukuk deal 2023
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The best sukuk deal 2023

Republic of Turkey’s $3 billion five-year sukuk.

Photo: Getty Images

With huge currency and stock market volatility and the waning fortunes of president Recep Tayyip Erdogan, Turkey’s bond market was a spectacularly inhospitable place for sukuk deals last year.

Despite this, the Turkish government and HSBC succeeded in bringing a $3 billion five-year sovereign sukuk transaction in February 2022; the largest-ever international deal from a non-Gulf Cooperation Council issuer.

It was Turkey’s biggest single-tranche issue in any currency or format, generating an order book of over $10.75 billion, reflecting amid strong demand from Islamic and international investors. The deal was a shot in the arm both for Turkey’s access to global markets and for the Islamic finance sector.

The transaction was also a huge relief for Erdogan’s embattled administration. It was Turkey’s first foray into global markets in a year of extreme volatility. The proceeds represent great progress in achieving Ankara’s annual $11 billion external funding target.

The issuer took a big gamble on tapping markets in chaos.

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