The Central Finance Department in Sharjah has launched a four billion dirham sukuk to boost liquidity for the Sharjah-based banks, to enable them to provide additional financial support to the business sector affected by the current exceptional circumstances, due to the pandemic of the Corona virus emerging (Covid-19).
A statement issued yesterday stated that the Sukuk denominated in AED 12 months were issued in several tranches, and it is the first negotiable instrument in the local short-term currency in the UAE, with a short-term investment rating of "A-2", by an agency International credit rating «Standard & Poor’s».
The general manager of the Central Finance Department in Sharjah, Walid Al Sayegh, said that the banks will be able to use the sukuk in order to guarantee the liquidity facilities in the UAE central bank, according to the regulations and policies that will ensure the flow of funds through the banking sector to the target segments, and other entities that face financial difficulties as a result Corona.
He added: “Since the beginning of the pandemic, the Sharjah government has presented many packages and initiatives aimed at supporting companies and individuals, and this innovative financial offering provides the required cash flows for the targeted sectors within the efficient and effective regulatory framework in place.”
According to the statement, Bank of Sharjah has subscribed for two billion dirhams in the first tranche, while other banks will subscribe later to the second tranche with a value of two billion dirhams as well.