To finance its portfolio of Sahl banking assets, KCB Bank Tanzania released its first Islamic bond for Tsh10 billion ($4.4 million). The paper that complies with Sharia law was launched on November 9 and ends on December 5.
According to KCB Tanzania managing director Cosmas Kimaro, “KCB Fursa Sukuk provides opportunities for Tanzanian and non-Tanzanian individuals, retailers, corporations and institutions to invest in the capital markets for three years at an expected return of 8.75 per cent per annum, quarterly.”
The initial investment is required to be at least Tsh500,000 ($218). Immediately following the current initial public offering, the bank will list the paper on the Dar es Salaam Stock Exchange. This year, KCB will sell bonds with NMB Bank and the National Bank of Commerce.
While NBC’s Twiga bond seeks to generate Tsh300 billion ($131 million) for financing small and medium companies, NMB issued its Tsh25 billion ($10.9 million) Jasiri bond to provide capital for women-owned firms.