(Adds context, analysis)
KUALA LUMPUR Aug 18 The Malaysia-based
International Islamic Liquidity Management Corp (IILM) will
lengthen maturities in its Islamic bond programme when it
auctions $790 million of sukuk next week, according to a filing
with the Malaysian central bank.
The decision to offer a six-month maturity for the first
time is a step towards increasing the appeal of IILM sukuk,
which were introduced to meet a shortage of liquid,
investment-grade instruments which Islamic banks can trade to
manage their short-term funding needs. Previously, the IILM
issued only three-month paper.
The IILM, a consortium of central banks from Asia, the
Middle East and Africa, will offer $400 million of six-month
sukuk and $390 million of three-month paper next Monday, the
The consortium launched its sukuk programme in August last
year and currently has $1.35 billion of paper outstanding,
including $490 million of three-month sukuk issued in May and
maturing this month.
It has said it may eventually expand issuance to $2 billion
or more; the programme permits maturities of up to one year.
Shareholders in 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.
(Reporting by Al-Zaquan Amer Hamzah; Additional reporting by
Bernardo Vizcaino; Editing by Andrew Torchia)