“Currently, we have about 500 billion ($55.4 million) rupiah invested in sukuk and we hope to increase that to more than 2 trillion rupiah this year,” Chief Financial Officer Hendiarto, said yesterday in an interview. (source)
“Parking our assets in sukuk will enable us to earn better returns and at the same time we can use it as a cushion for liquidity.”
The Jakarta-based lender, with assets of about 20.4 trillion rupiah as of December, is targeting asset growth of 50 percent this year, Hendiarto, who goes by only one name, said. The bank’s assets grew 32 percent from 16.02 trillion rupiah at the end of 2009, he said.
Islamic banking assets in Indonesia, Southeast Asia’s biggest economy, grew to 100.2 trillion rupiah last year from 67 trillion rupiah at the end of 2009, Mulya Siregar, the head of Shariah banking at Bank Indonesia, said in an interview Jan. 20. The central bank aims to increase the amount to 130 trillion rupiah this year, he said.
Bank Muamalat, which has 350 offices in Indonesia and a branch in Malaysia, will seek sovereign issuances both from Indonesia and Malaysia, the world’s largest sukuk issuer. Malaysia is a close neighbor so we’re comfortable with that market,” Hendiarto said. “Supply is limited; we need more sukuk to invest in.”
Sales of sukuk, which pay asset returns to comply with Islam’s ban on interest, rose 56 percent in Indonesia to 26.2 trillion rupiah in 2010, according to data compiled by Bloomberg. Global sales fell 15 percent to $17.1 billion last year, with offerings so far this year of $1.6 billion.
Indonesia may sell dollar-denominated conventional and Islamic bonds this year, Rahmat Waluyanto, director general of the Finance Ministry’s Debt Management Office, said in an interview in Jakarta on Jan. 11. The government also plans to increase the type of assets that can be used to pay returns on Islamic bonds to include road and rail projects, he said.
To contact the reporter on this story: Suryani Omar in Jakarta at somar6@bloomberg.net;
To contact the editor responsible for this story: James Regan at jregan19@bloomberg.net
Source : http://www.bloomberg.com/news/2011-02-02/bank-muamalat-indonesia-aims-to-quadruple-its-sukuk-holdings.html - Feb 02, 2011
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