The sukuk market expanded by nearly a third in 2014 thanks to a series of new issues, market growth and an increase in the average deal size.
The biggest issuer of the year was the Islamic Development Bank (IDB) Trust, based in Jeddah, which issued $3 billion of new sukuk, followed by Saudi Electric, a state-owned energy firm, which issued $2.5 billion.
The average sukuk size, according to data from S&P Dow Jones Indices, is now $880,000, an increase of 6% compared with 2013. The total market size at the end of December was $48 billion, up 32% compared with the previous year.
Sukuk, which are instruments that mimic the performance of bonds in a sharia-compliant manner, are becoming an increasingly popular asset class. As well as the many corporate issuers to hit the market in 2014, new sovereign issuers such as South Africa and Hong Kong issued sukuk for the first time.
The data is based on the Dow Jones Sukuk Total Return Index (Ex-Reinvestment), which aims to track the global sukuk market. The performance of the index in 2014 was 6.4%.
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