EI Sukuk Company’s $500 million sustainability-linked financing sukuk transaction stood out less for its size than for the way it pushed sustainable Islamic finance into a more sophisticated capital markets format.
The 4.54% sukuk, structured on a wakala-murabaha basis and rated A+ by Fitch, was designed so that an amount equal to the net proceeds would be allocated to finance or refinance a portfolio of general corporate purpose Islamic financing instruments under Emirates Islamic’s sustainability-linked lending funding framework.
The most distinctive feature was the use of proceeds. Rather than simply applying a familiar green sukuk template, the transaction stood out as the first sukuk specifically intended to finance sustainability-linked Islamic financing, and the first such issuance by an Islamic bank. That made it a product innovation as much as a funding exercise, connecting sukuk investors with a portfolio-based framework linked to sustainability objectives.
The transaction stood out as the first sukuk specifically intended to finance sustainability-linked Islamic financing, and the first such issuance by an Islamic bank
The cross-border appeal of the structure was another hallmark of the deal. The mandate was announced with a global investor call, followed by fixed-income meetings across the UK, Europe, Asia and the Gulf Cooperation Council (GCC).
The deal was oversubscribed, underscoring that investors were prepared to engage with a Shariah-compliant sustainable finance instrument that went beyond a conventional labelled bond or project-linked green sukuk.
Mashreq Al Islami acted as a joint bookrunner on the transaction, while Emirates Islamic originated and shaped the structure, sustainability framework, Shariah governance and asset selection process.
