The Nairobi Securities Exchange PLC (NSE) has approved the listing of Linzi Sukuk on the bourse’s Unquoted Securities Platform (USP), making the product the first Shari’ah-compliant product to be admitted on the platform.
The Linzi Sukuk brings the total number of admitted securities on the USP to three. Issued by Linzi FinCo Trust, a common law unincorporated trust, the bond is a KSh 3 billion Islamic secured residential-based security with a maturity period of 15 years offering an internal rate of return of 11.13%.
Sukuk, also known as Islamic bonds, are financial instruments that comply with Shari’ah principles. Among the most prominent of this is a prohibition of interest payments, a defining aspect of Islamic finance.
- The proceeds from the issue will be used in the financing, design, construction, and commissioning of 3,069 institutional houses.
- In September, Linzi FinCo received approval from the Capital Markets Authority to launch the Islamic bond.
“Kenya holds huge potential in Shari’ah compliant instruments that can play a significant role in bridging the vast financing needs, across various priority sectors such as infrastructure and housing in the country,” Geoffrey Odundo, Chief Executive, NSE noted in a statement.
- The Unquoted Securities Platform (USP) is an automated solution for the issuance and trading of securities of unquoted companies.
- It currently hosts the Acorn Student Accommodation Development Real Estate Investment Trust (D-REIT) and the Income Real Estate Investment Trust (I-REIT).
The platform is used for value discovery, capital raising, and trading experience by small and medium enterprises before graduating to the listing segments offered by the NSE.