Nomura Holdings has appointed Kuwait Finance House (Malaysia) Berhad (KFHMB) as mandated lead arranger for its proposed Sukuk issuance of $100 million in two-year trust certificates.
Standard & Poor’s assigned a ‘BBB+’ preliminary rating to the issuance, reflecting the credit risk of Nomura Holdings. The move marked the agency’s first rating of a Sukuk, or Arabic financial certificate, with a sponsor company based in Japan.
The Sukuk’s assets consist primarily of ownership interest in aircraft assets and rights under the associated lease agreements, according to S&P.
NBB Ijarah (NBBI), a special purpose legal entity, will sell its legal interests in two aircraft assets to the trustee and will act as the transaction’s servicing agent. NBBI will then purchase the underlying assets at maturity. Nomura will guarantee all of NBBI’s obligations to the trustee.
“With this landmark transaction, Nomura has further diversified its funding sources and tapped the large and growing Islamic finance market for the first time,” said Takumi Shibata, Nomura’s deputy president and chief operating officer.
He added that this issuance is part of the bank’s ongoing push to diversify its funding sources and drive growth. Islamic investors and Islamic finance, he said, are a very important and rapidly growing sector globally and this deal is significant for Nomura and for corporate Japan.
"Nomura has now opened the way for other Japanese corporations to tap the Islamic finance market, and we believe that the transaction will lead to significant benefits for Nomura and for our clients and partners,” Shibata said.
"Nomura's guarantee will rank pari passu with the company's other senior unsecured obligations, and underpins our equalization of the rating on the certificates with our long-term counterparty credit rating on Nomura," said Allan Redimerio, an S&P credit analyst.
Nomura Holdings is a Japanese financial holding company and a principal member of the Nomura Group.