Regulatory Alerts2023-08-27
Added
DMD Circular Letter No. 06: Regarding Sukuk Allotment Quota
The document mandates specific allotment quotas for investors in the issuance of Bangladesh Government Investment Sukuk, allocating 85% to Shariah-based banks, financial institutions, and insurance companies, 10% to Islamic branches and windows of conventional banks, and 5% to individual investors, provident funds, and deposit insurance. It establishes pro-rata distribution mechanisms for oversubscribed or undersubscribed categories and allows conventional banks, financial institutions, and insurance companies participating in the auction to receive any remaining Sukuk if the three specified categories do not meet their required subscription levels. These instructions take immediate effect.
50119
Bangladesh Bank (Central Bank of Bangladesh) Head Office Motijheel, Dhaka-1000 Bangladesh.
Data Management Department
11 Bhadra 1430 Date: ------------------- 27 August 2023
DMD Circular Letter No.-06
Managing Director / Chief Executive All Scheduled Banks and Financial Institutions of Bangladesh
Dear Sir,
Regarding Sukuk allotment in favor of investors.
In accordance with the 'Bangladesh Government Investment Sukuk Guidelines, 2020' issued through DMD Circular No.-05 dated 21/10/2020 of this department, Sukuk allotment in favor of investors shall be provided as follows in the issuance of Sukuk:
| Category | Type of Investors | Percentage of Sukuk Allotment in Favor of Investors |
|---|---|---|
| 1. | Shariah-based banks, financial institutions, and insurance companies | 85% of the issued Sukuk |
| 2. | Islamic branches and windows of conventional banks | 10% of the issued Sukuk |
| 3. | Individual investors, provident funds, deposit insurance, etc. | 5% of the issued Sukuk |
In addition, alongside the aforementioned three categories, all conventional banks/financial institutions/insurance companies may participate in the Sukuk auction, and the following procedure shall be followed for Sukuk allotment in favor of investors:
a) If bids are submitted in excess of the determined ratio in all three categories, Sukuk shall be allotted on a pro-rata basis among the bidders in each category; b) If bids are submitted below the determined ratio in one category and above the determined ratio in another category, the remaining Sukuk shall be allotted on a pro-rata basis among the bidders who submitted bids above the determined ratio; and c) If the required subscription is not met in the aforementioned three categories, the remaining Sukuk shall be allotted on a proportional basis among the participating conventional banks, financial institutions, and insurance companies in the auction.
These instructions shall take immediate effect.
Yours faithfully,
(Signature) (Masuma Sultana) Additional Director Phone: 9530209 E-mail: masuma.sultana@bb.org.bd
Phone: 88-02-9550448, 9554896, IP: 88-02-55665001-6, Fax: 88-02-9530479, www.bb.org.bd