TAJBank’s N10bn Sukuk reaction to market appetite for Halal instruments –Official

TAJBank Limited says its recent N10 billion Sukuk, a non-interest bond, listed on the the Nigerian Exchange Limited, was informed by the growing market yearnings for Halal investment instruments.

A statement from the Bank said the latest N10bn Mudarabah Sukuk issuance is second in the series after it successfully raised N11.4 billion under its N100bn Sukuk Issuance Programme.

The statement noted that the Sukuk, which is the first of its kind in Nigeria, is an additional Tier 1 Capital Mudarabah with loss-absorbency features designed to help TAJ Bank strengthen its capital adequacy ratio and general corporate business activities.

The issuance received interest from both retail and institutional investors, resulting in a subscription of 113.6.

The oversubscription of this issuance demonstrates that the investment culture in the country is still vibrant and there is sustained confidence in Nigeria’s path to economic recovery and stability.

Speaking, the Managing Director/CEO, TAJBank, Mr. Hamid Joda said the aim of the Sukuk listing is to give Nigeria’s investors alternative means of investment.

He noted that, “Millions of investors have been yearning for non-interest or Islamic instrument. We believe this is an opportunity for them to invest in such an instrument.

“The funds raised will be deployed into high-impact sectors that create jobs in Nigeria’s economy and in that way, it will have high-impact opportunities for millions of Nigerians.”

Commonly referred to as Islamic Bonds, Sukuk – a non-interest-bearing bond- has helped the government diversify its sources of funding while offering ethical investors an opportunity to invest in government-issued securities.

The instrument has not only helped the government achieve a higher level of financial inclusion but has served as a reference for pricing Sukuk issued by other bodies, especially the private sector.

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