The Financial Regulatory Authority (FRA) approved the issuance of “mudaraba sukuk” compatible with the provisions of Islamic Sharia with a value of EGP 2bn for a period of 84 months, starting from the day after closing subscriptions for sukuk for the benefit of Tharwa.
This is the fourth version of sukuk issuances to finance beneficiary company Contact Finance.
The company directs the outcome of the issuance to finance the purchase of cars owned by its own customers or customers of its subsidiary and sister companies that carry out the same activity, bringing the total sukuk issued this year to EGP 5.251bn.
Head of the FRA Mohamed Farid said that the authority is keen on issuing all necessary decisions and procedures to develop markets and non-banking financial tools while maintaining their stability and enhancing the transparency of the activities they practice.
Farid added that the latest edition of sukuk is integrated with the authority’s efforts to develop the capital market by providing various financing solutions and products that meet the needs of various economic entities to develop their business.
This includes sukuk that provide the money market with an investment product that meets the demand of some investors to invest in products compatible with Islamic Sharia.
Farid added that since the issuance of these sukuk is now complete, the value of sukuk issuances — including all six issuances from 2018 till now — will be estimated at EGP 12.851bn
The current edition obtained the approval of the Central Sharia Supervision Committee to ensure its compatibility with Islamic Sharia before continuing with the procedures.
It is worth noting that the total issuances of bonds and sukuk that obtained the approval of the authority since the beginning of 2022 is worth about EGP 16.410bn, which confirms the importance of continuing to develop and improve all procedures related to the processes of offering and including sukuk and all debt tools inside the market.