ISLAMABAD: Pakistan is all set to issue one billion dollar denomination of Sukuk Bonds in the international market of building its continuously depreciating foreign exchange reserves to a comfortable level, it is learnt reliably.
Sources told this scribe that Pakistan will on Wednesday hold a road-show at Dubai to persuade the International buyers, meanwhile the other roadshows will be held at London, Boston and New York on November 23, 24, 27 and 28 respectively.
Sources further told that government has mandated Citi, Deutsche Bank, Dubai Islamic Bank, ICBC, Noor Bank and Standard Chartered Bank as joint lead managers and bookrunners on a US Dollar denominated benchmark Regulation S conventional tranche 144A 5-year Sukuk issue.
In addition to this, Pakistan has mandated Citi, Deutsche Bank, ICBC and Standard Chartered Bank as joint lead managers and bookrunners for a US Dollar denominated benchmark Regulation S conventional tranche 144A bond with 10 year maturity, and will also consider the possibility of a longer dated US Dollar denominated benchmark Regulation S conventional tranche 144A, subject to investor feedback.
Earlier this month, the federal cabinet had allowed immediate borrowing of up to $ 3 billion from international debt markets by floating three sovereign bonds and has also waived a dozen taxes to make deals attractive for investors.
The government, in the budget for the ongoing financial year 2017-18, had projected to generate $ 1 billion from issuing Sukuk Bonds in the international market. Issuing bonds could boost the declining foreign reserves of the country.
Pakistan floated Sukuk in September 2016 at the lowest interest rate of 5.5 per cent but its September 2015 five-year Eurobond at 8.25 per cent was the most expensive deal.
It is worth mentioning here that incumbent government has so far issued Eurobonds and sukuk bonds worth over $ 5.5 billion during its four-year tenure. On the other hand, the country would have to repay $ 7.4 billion on external debt including $ 1.6 billion on interest payment during the current fiscal year.
Similarly, the country would repay $ 4.263 billion in 2018-19, $ 7.07 billion in 2019-20 and $ 4.571 billion in 2020-21.
A spokesperson for the Finance Ministry while talking to Pakistan Today said that Secretary Finance Shahid Mahmood and State Bank of Pakistan (SBP) Governor will hold roadshows at different places. Initially, it was estimated to issue 500 to $ 1 billion Sukuk bonds but it will subject to investor feedback, he added.
