June 25, 2014 / 7:56 AM / 6 years ago

UK Treasury opens books on inaugural sukuk

LONDON, June 25 (IFR) - The UK government has started marketing an inaugural five-year sukuk at flat to 2bp over the 1.75% July 2019 Gilt, according to a source.

The July 2019 transaction, which is being issued by HM Treasury UK Sovereign Sukuk, is expected to be priced later today. The two obligors for the trade are the secretary of state for communities and local government, and HM Treasury.

The sukuk Al-Ijara (head lease and sub-lease) is set to be a no-grow £200m bond sold via HSBC as structuring bank, together with Barwa Bank, CIMB, National Bank of Abu Dhabi and Standard Chartered Bank.

The UK government is rated Aa1/AAA/AA+.

Reporting by Sarka Halas, editing by Helene Durand, Julian Baker

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