Islamic finance body IILM to issue $490 mln sukuk next week

SYDNEY Tue Feb 18, 2014 7:33pm EST

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SYDNEY Feb 19 (Reuters) - The Malaysia-based International Islamic Liquidity Management Corp (IILM) will issue a $490 million three-month Islamic bond next week, after expanding its issuance programme to $1.35 billion in January.

The auction of the three-month sukuk, rated A-1 by Standard and Poor's, will be conducted on Feb. 25, according to a filing lodged with Malaysia's central bank.

Last month, the IILM sold $860 million worth of three-month paper, designed to meet a shortage of highly liquid, investment-grade financial instruments which Islamic banks can trade to manage their short-term funding needs.

Since the programme's launch, primary dealers have held on to the IILM instruments after auction and there has been little if any secondary market trade in them, an official at one of the primary dealers told Reuters.

Shareholders of the IILM are the central banks of Indonesia, Kuwait, Luxembourg, Malaysia, Mauritius, Nigeria, Qatar, Turkey and the United Arab Emirates, as well as the Jeddah-based Islamic Development Bank. (Editing by Eric Meijer)

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