Goldman Sachs gets back in the sukuk business

In a landmark offering made on the 16th September 2014, Goldman Sachs became the first US bank to issue sukuk. Sources say the New York-based lender attracted bids for three times the US$500 million of sukuk it sold. The five-year sukuk was priced to yield 90 basis points, or 0.9 percentage point, over the benchmark midswap rate. The sukuk are to be issued through a vehicle called JANY Sukuk Co and guaranteed by Goldman Sachs. Proceeds of the issue will be used in the commodities business of a unit of Goldman, J Aron & Co. They have been rated ‘A minus’ by S&P and A by Fitch Ratings, which is the same rating for Goldman Sachs overall as an enterprise. Goldman picked itself, Abu Dhabi Islamic Bank, Emirates NBD, National Bank of Abu Dhabi, Qatar’s QInvest and the investment banking arm of Saudi Arabia’s National Commercial Bank to arrange the issue. Investor roadshows took place only in the Gulf. “We are pleased to see continued interest in Islamic finance from a bank with the reputation of Goldman Sachs,” says Ahsan Raheem, CFA®, of US-based investment advisor Azzad Asset Management. “It is important for our industry to have a wide base