EIIB-Rasmala closes USD100 million sukuk programme for insurance group

The EIIB-Rasmala has closed the second tranche of FWU Group’s US$100 million sukuk al-wakala programme. The second tranche of the programme has closed for US$40 million.


The former is acting as the lead arranger and bookrunner for FWU’s sukuk al-wakala programme.


The FWU sukuk has been assigned the investment grade credit rating BBB- by Fitch and is being issued in amortizing tranches, each with a term of five years. The first tranche of the programme previously closed for US$20 million in October 2013. Distributions are made quarterly to investors on a fully amortizing basis and the profit rate is 7% per annum.


Harris Irfan, Managing director at EIIB-Rasmala, said: “We‘re extremely satisfied with the demand shown, once again, for this innovative sukuk offering. This second tranche issuance has diversified the range of investors, all of whom will benefit from the even wider geographical spread of the sukuk’s underlying insurance policies, which now include policies from France and Germany in addition to Italy.


The flexibility of the al-wakala structure used by FWU allows for a variety of underlying assets to be securitized; in this case, the asset management fees of investment portfolios associated with the insurance policies.


The sukuk sponsor, FWU, is a European based financial services group which offers unit-linked life and annuity assurance products, with operations across Europe, the Middle East and Asia. The sukuk will fund, in a fully Sharia’a-compliant manner, a set of retakaful (or re-insurance) transactions for one of FWU’s five main subsidiaries, Atlanticlux. The sukuk is asset-backed, representing a true ring-fencing of assets.


Morgan Lewis & Bockius acted as counsel to FWU, and as transaction structuring counsel. Bedell Cristin Guernsey Partnership acted as Guernsey counsel to the issue and issuer, and Amanie Advisors acted as Sharia’a advisors to FWU.