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International bonds market recovered

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Kuwait Finance House: International bonds market recovers in September, total exports reach $7.8bn

The international bonds market recovered during the month of September according to Kuwait Finance House, with total issuing rates reaching $7.8bn, representing 33% growth compared to August of the same year.

In its monthly report on the bonds market, Kuwait Finance House stated that no exports were made in American dollars, pointing out that sovereign agencies issued the highest rates of bonds, with private companies placing second.

It stated that 47 bonds were issued in September compared to 55 in August, with Dubai Islamic bonds achieving the highest performance of sovereign bonds issued in American dollars during the third quarter of 2013. The total accumulation of bonds issued during the first three quarters reached $83bn, $20bn less than the $103bn witnessed during the same period in 2012.

The report showed that Malaysia issued the highest rate of bonds in September, making up 65.5% of the market. Malaysia’s share of the market from the beginning of the year to the end of last September reached 70.1%, compared to 74% seen during the previous year.

The report showed that the total number of bonds issued by private companies from the beginning of the year to the end of September reached $9.1bn, compared to $23.2bn during the same period in 2012. Bond rates issued by sovereign bodies this year totaled 3.1% of the market, reaching $46bn by the end of September.

The most prominent bonds issued in September included those sold by the Saudi Arabian Al-Marai company, whose total sales reached SAR1.7bn ($453.1m). This was considered the first hybrid issuing of bonds for a company outside the banking sector within the Arab Gulf region.

The share of bonds for sovereign bodies totaled 84.9% of the initial market in September, while government agencies made up 4% of the market. The remaining 11.1% was filled by bond companies.

Kuwait Finance House stated that of currencies issued, the Malaysian ringgit was the most widely distributed, at a rate of 65.8% of currencies issued during the month of September. No dollars were issued during the month of September, as the last bonds made in dollars were sold in August, which was the only international issuance during the third quarter of 2013.

The report showed that companies’ issued a total of 11 bonds, at a total value of $859.7m, compared to total rates for sovereign funds which issued 33 bonds at a rate of $6.6bn in September. Government agencies meanwhile issued a total of $306.4m worth of bonds.

Translated from Al Borsa newspaper

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