The Government of Pakistan has launched Sukuk bonds worth $1 billion of five-year maturity in the international bonds market.
The US dollar denominated Islamic bonds Pakistan is floating after a gap of nine years, is said to have attracted about $1.7 billion investment.
The Pakistani team led by Finance Minister Ishaq Dar has so far held fixed income investor meetings in Dubai and London to lure foreign investors to invest in the Sukuk.
According to sources, the five-year issue would help the funds-starved PML-N government save around Rs 5 billion on account of debt servicing. The sovereign bonds have been launched at 6.75 per cent, they added.
The total bids received, the sources said, stand at $2.3 billion, five times higher than the amount Islamabad has targeted.
“Of total bids of $2.3billion, $1.0 billion is accepted at 6.75%,” said the sources.
This offer, they said, was 50 basis points better than the Eurobond for five years issued in April.
According to sources, in total the Pakistani Sukuk attracted about $1.7 billion from offshore investors.
After the launch of five-year bonds, the government would launch securities of 10 years maturity in a short while.
The Government of Pakistan had mandated four leading banks, CITI, Deutsche Bank, Dubai Islamic Bank and Standard Chartered Bank to arrange fixed income investor meetings that started from Monday.
About the issue, officials at one of the four leads said the Pakistani credit would have a great demand in the Gulf and European debt markets.
“We see great value for Pakistan credit in the highly liquid sukuk markets in the Gulf states,” Saim Ali of Standard Chartered Bank told Pakistan Today.
The banking analyst anticipated a strong demand and better pricing for the Sukuk versus Eurobond Islamabad had launched earlier.