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Philippines beefs up Islamic banking, eyes issuance of sukuk bonds

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Lady Vicencio, ABS-CBN News

<div class="embed-wrap"><figure data-feedback="fb:likes,fb:comments"><img alt="Filipino Muslims rest after attending the afternoon prayers at the Manila Golden Mosque in Quiapo. George Calvelo, ABS-CBN News/File photo​" src="https://sa.kapamilya.com/absnews/abscbnnews/media/2023/life/03/21/20220402-manila-golden-mosque-ramadan-gc-10.jpg"/><figcaption>Filipino Muslims rest after attending the afternoon prayers at the Manila Golden Mosque in Quiapo. <em>George Calvelo, ABS-CBN News/File photo​</em></figcaption></figure></div><p>MANILA — The Philippine government is planning to offer Islamic bonds or sukuk bonds, the Bureau of Treasury said.</p><p>In the Philippine Economic Briefing in Dubai, National Treasurer Rosalia de Leon said that the government is looking into issuing sukuk bonds by the end of 2023 or by the first quarter of 2024.</p><p>Abiding by Islamic principles, sukuk bonds generate returns to investors profit sharing from projects funded by the bonds instead of earning interest.</p><p>This would mark the Philippine’s first venture in the Islamic bond market.</p><p>“We’re now discussing with some of our potential underwriters in terms of the preparatory arrangements that we need to do including the structure, whether it would be a hybrid - a wakalah ijara, or murabaha,” de Leon said. </p><p>The government is looking to raise $1 billion from sukuk bonds, she said.</p><p>De Leon mentioned that the government plans to issue Islamic notes with maturities of five or 10 years.</p><p>“In terms of the tenor size, I think the sweet spot would be between the long five and the 10-year because this would also be something that would be catering to our small investors and at the same time also to the institutional investors,” De Leon said. </p><p>“As for the timing, we’ve been told that there would have to be a 12-week preparatory lead time that would be needed, so hopefully we can do this before the end of the year or if ever, it would have to slip to the first quarter of 2024,” she added. </p><p>Bangko Sentral ng Pilipinas Assistant Governor Arifa Ala said this is a “very good complement” to the Philippines’ Islamic banking.</p><p>“Having a sukuk being issued by our national government will send a strong signal that the Philippines is now ready to accept applicants, new players in the Islamic banking system,” Ala said. </p><ul class="op-related-articles">	<li><a href="https://news.abs-cbn.com/business/09/13/23/ph-economy-team-urges-dubai-firms-to-invest-in-mindanaos-infra-energy-sectors">PH economy team urges Dubai firms to invest in Mindanao&#x27;s infra, energy sectors</a></li></ul><ul class="op-related-articles">	<li><a href="https://news.abs-cbn.com/business/06/10/16/ph-may-join-asian-sovereigns-testing-sukuk-market">PH may join Asian sovereigns testing sukuk market</a></li></ul><div><strong> RELATED STORY:</strong></div><figure class="op-interactive"><iframe height="315" src="https://www.youtube.com/embed/bLnxRXpGkHg?enablejsapi=1" width="560"></iframe></figure><div class="iwantbar">Watch more News on <a href="https://www.iwanttfc.com/#!/browse/Genres/News/tag_id_genres/id_news" target="_blank">iWantTFC</a></div>

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Philippines beefs up Islamic banking, eyes issuance of sukuk bonds

Lady Vicencio,

ABS-CBN News

Published September 13, 2023 12:58 PM PHT

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Islamic bonds

sukuk bonds

sukuk

Islam

Muslim

bonds

national treasury

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