Resurrection Of Sukuk As An Instrument Of Monetary | Sharia Banking and the Financial Industry

Resurrection of sukuk as monetary instrument

November 28, 2011 By: admin Category: Retail Sukuk

Sukuk is not only able to manage traffic economy but also potentially as a financing instrument. In addition, sukuk also has the potential to become an instrument to manage excess liquidity mismatch. T-Bill Syariah or SPN-S who has just published in early August 2011 is now reaching the monetary area. During this monetary instrument the spirit of sukuk presence is to perform a partial migration of the monetary instruments the central bank to the Ministry of Finance. Starting last August, the government has issued securities sharia state (SBSN), or sukuk, a new type of state to respond demand the central bank to provide liquidity instruments that support the management of Islamic banks. In the same period, the government immediately issued two series in a row. SPN-S Series 03022012 issued August 4 and mature on February 3, 2012 managed to raise funds amounting to Rp570 billion. Then, NES 24022012-S series, published August 25 and will mature February 24, 2012 managed to raise funds Rp330 billion. It cannot be denied, the needs of a large market for sukuk based on the availability of monetary instruments having tenors below one year to make SPN-S has a strategic value than certificates of Bank Indonesia Sharia (SBIS) that existed before. Even more monumental when the government publishes global sukuk of U.S. $ 1 billion in mid-November 2011 occurred oversubscribed (excess supply) to 6.5 times. From the government pegged the indicative target of U.S. $ 1 billion, the amount of incoming order book reached U.S. $ 6.5 billion. The global sukuk will mature seven years with a fixed coupon of 4% using the ijara structure. Pricing 4% yield is the lowest achievement in the history of publishing SBN international capital markets and even the lowest in the global sukuk issuance of global bonds and tenured seven years by countries in Asia. In comparison, global bonds issued Bahrain which is not much different from Indonesia sukuk set yield 6.25%. This means that there is a spread of up to 225 basis points (bps). Although Bahrain has signed investment grade with a BBB rating. Indonesia, still has a rating of “junk” or below investment grade. This illustrates how the global sukuk product Indonesia as the largest Muslim country in the world with an economy that is really attractive to the market. The biggest share held by investors is 32% Asia, the Middle East 30%, Europe 18%, and U.S. 8% and 12% local. This happens because the alien does not have a huge selection of safe investments. Indonesia already has a higher position in foreign currencies by providing a lower yield than the same bond issue several years ago. Since its inaugural publication in 2008, the function of the state sukuk is still not moved far from its existence as a fiscal instrument.