Saudi issuers boost global sukuk issuances in 2019: S&P

Saudi Arabia-based issuers are supporting the global sukuk market, as total issuances are set to reach $115 billion in 2019, according to S&P Global Ratings report.

"High levels of liquidity in Indonesia, Turkey's efforts to tap all available financing sources, and the return of Saudi Arabian issuers to the market have boosted issuance of sukuk 17.6 percent in the first five months of 2019," said Mohamed Damak, head of Islamic Finance, S&P Global Ratings.

“We now anticipate total sukuk issuance of $115 billion this year, including $32 billion of foreign currency issuances, which is the upper limit of our previous forecast," he noted.

However, Damak said that it represents little-to-no growth on the $114.8 billion seen in 2018, with selective investors, worsening geopolitical stability in the Middle East, and challenges inherent to sukuk likely to hold back the market.

Earlier this year, Damak said that higher sukuk issuances by Gulf Cooperation Council (GCC) sovereigns were expected if the oil price stays below $55 for a sustained period.