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Al Baraka Turk Participation Bank issues successfully $350 million Islamic Sukuk

July 1, 2014

Al Baraka Banking Group announced that its Turkish subsidiary, Al Baraka Turk Participation Bank, has successfully completed an issuance of Islamic Sukuk worth $350 million in the form of Sukuk Al Wakala-Murabaha, given the large orders received by the Issue, as the value of total subscriptions reached $750 million, more than double the required amount.

The issue of the Sukuk was through the bank's leasing subsidiary, Bereket Varlik Kiralama A.S, while the obligor is Al Baraka Turk Participation Bank. The Issue is rated BB by Standard & Poors, and is listed on the Irish Stock Exchange, and carries profit rate of 6.25 per cent per annum for a period of five years and is payable on June 30, 2019.

Many banks, financial institutions and investment funds from different main world financial centres participated in the Issue with 61 per cent from Middle East, 31 per cent from Europe and eight per cent from Asia. The Joint Lead Managers of the Issue were Emirates NBD Capital, Nomura, QInvest and Standard Chartered Bank. In terms of investors type, 80 per cent of them were banks and financial institutions, eight per cent Funds, six per cent Hedge Funds and six per cent Agencies.

Adnan Ahmed Yousif, Chairman of the Board of Directors of Al Baraka Turk Participation Bank and President & Chief Executive of Al Baraka Banking Group said, "We are indeed delighted at the large success of the Islamic Sukuk of the Bank, given the prevailed fluctuated financial markets and world economic conditions. This  endorses the strength of the position and reputation of Al Baraka Turk Participation Bank in the Turkish market, on the back of its consistent and successful performance over the past many years? and the  successes and reliability enjoyed by a series of syndicated finances and Sukuk issuances arranged by the Bank during the past years. This success is also a testament to the global reputation and prestige enjoyed by the Al Baraka Banking Group, regionally and globally."

Dr. Fahrettin Yahsi, Member of the Board of Directors and General Manager of Al Baraka Turk Participation Bank said, "The Bank has now glistening position and reputation in the Turkish market and become a major player in this market. Therefore, we constantly strive to strengthen and diversify our financial resources, duly endorsed by our financial performance and our ability to adapt to the current economic situation in the world markets and in order to provide the best services for the Turkish market, which enjoys the diversity and abundance of economic activities and opportunities"?.

During 2013 the bank's total operating income increased by 35 per cent to TRL 855 million ($447 million) during the year 2013 compared with the same period of 2012. The net income was TRL 232 million ($121 million) during the year 2013, an increase of 19 per cent compared with the same period of 2012.

As of the end of 2013, the bank's assets grew by 40 per cent to TRL 17.2 billion ($8.1 billion) compared with December 2012. Investment and finance portfolio reached TRL 13.1 billion ($6.2 billion) as of December 2013 compared to December 2012. The bank expanded its customer and deposit accounts by 37 per cent to TRL 14.5 billion ($6.8 billion) as of end 2013 which financed a total of 84 per cent of total assets, reflecting the strong deposit customer base. Shareholders' equity strengthened by 22 per cent to reach a total of TRL 1.5 billion ($710 million) at the end of December 2013. Al Baraka Turk Participation Bank has 167 branches spread all over Turkey, employing 3057 staff at the end of 2013 and is a member of the Al Baraka Banking Group.

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Source: CPI Financial

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