Hong Kong's first Islamic bond offer raises USD$1bn

Hong Kong’s first issue of Islamic bonds compliant with a Sharia ban on interest raised USD$1 billion, Bloomberg reported, citing a statement on the city government’s website today. The dollar-denominated five-year notes were priced at a 2.005% profit rate, and the sale drew USD$4.7 billion in orders from around the globe, far exceeding the amount on offer. Islamic bonds, commonly referred to as sukuk, pay returns from an underlying asset such as property or income from transportation systems. Offerings of sukuk worldwide have climbed 31 percent to USD$30.4 billion in 2014 from a year earlier, after reaching USD$43.1 billion in 2013 and a record USD$46.5 billion in 2012.