Malaysia Debt Ventures eyes 1.5 bln rgt Islamic bond

KUALA LUMPUR, Aug 25 (Reuters) - State-controlled Malaysia Debt Ventures Bhd plans to sell about 1.5 billion ringgit ($444.7 million) of Islamic bonds to help fund technology firms and other fast-growing sectors, the company said on Monday.

The bonds are expected to be issued this year, said a senior company official who declined to be identified.

"The entire facility is about 1.5 billion so it all depends on the market situation," the official told Reuters by telephone, adding that CIMB Investment Bank is the deal's lead arranger.

CIMB Investment is part of CIMB Group, which is listed on the Malaysian stock exchange through Bumiputra-Commerce Holdings BUCM.KL.

The official declined to disclose the maturity of the paper.

Malaysia Debt was set up in 2002 to help finance companies in fast-developing sectors such as information and communications technology and biotechnology.

Some companies in these sectors have found it tough to raise funding from capital markets as they are relatively new industries in the country. Malaysia wants to promote sectors such as biotechnology to generate alternative sources of revenue for its trade-dependent economy.

Malaysia Debt's plan for a bond sale comes as some firms reassess their fund-raising plans due to jitters in global credit markets.

Abu Dhabi Commercial Bank ADCB.AD (ADCB) was reported to have delayed a bond sale priced in Malaysian ringgit and slashed its potential size because of market conditions.

ADCB, Abu Dhabi's third-biggest bank by market value, had initially expected to raise as much as 1 billion ringgit by selling bonds, but this was reduced to 300 million ringgit, the Middle East Economic Digest reported, citing bankers close to the deal.

Islamic bonds have to be backed by assets and typically avoid the opaque, complicated structures of their conventional counterparts, making them seem a slightly safer investment during uncertain market conditions.

Malaysia has the world's largest Islamic bond market, accounting for about 60 percent of global Islamic bonds outstanding which are worth about $100 billion, according to central bank estimates. ($1=3.373 Malaysian Ringgit)

(Reporting by Liau Y-Sing; editing by Elaine Hardcastle)