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Thursday, April 25, 2024 1:35 GMT
The Sultanate’s capital market witnessed a significant uptick in listed debt instruments in 2019, underscoring the increasingly expanding role of debt in facilitating economic growth in the country, in parallel with the equity side of the capital market. New issuances ranged from corporate bonds and corporate sukuk to government bonds and sovereign sukuk.According to the newly published 2019 Annual Report of the Capital Market Authority (CMA), there were as many as four corporate bond issuances (Sohar International Bank Perpetual Bonds, Al Omaniya Financial Services Bonus Stock Bonds, Ahli Bank Perpetual Bonds, and DIDIH Unsecured Subordinated Non-Convertible Bonds) in 2019 totaling RO 146.5 million (~US$376.8 million) in value. The sole sukuk issuance (Meethaq Sukuk Series 2) raised RO 45.6 million (~US$118.1 million).By the end of 2019, a total of 16 corporate bond issuances totaling RO 556 million (~US$1.4 billion) in value were listed on the MSM. So were five corporate sukuk totaling RO 169.7 million (~US$439.5 million) in value.Also during the year, three government bonds were issued by the Central Bank of Oman (CBO) of a total value of RO 400 million (~US$1.03 billion). In addition, the state-owned Oman Sovereign Sukuk Company launched Sukuk Al Ijarah in favor of the Omani government represented by the Ministry of Finance. Offered in two issues by way of private placements via the book-building process, they raised RO 300 million (~US$777 million).By the end of 2019, as many as 19 government bonds (totaling RO 2.63 billion (~US$6.8 million) in value) and three sukuk (totaling RO 550 million (~US$1.42 billion) in value) were listed on the MSM.In recent years, the MSM has seen a significant increase in the number and variety of debt instruments listed on the exchange. Once limited to a handful of government and corporate bonds, they now include government development bonds, US dollar denominated and Omani-riyal denominated sovereign sukuk, perpetual bonds issued by both banks and non-banking entities, corporate bonds and corporate sukuk.Bonds and sukuk, aggregating RO 3.92 bilion (~US$10.1 billion) in value last year, accounted for a 21% share of the MSM’s market capitalization of RO 18.77 billion (~US$48.6 billion). This compares with a total value of RO 560 million (~US$1.45 billion) in 2011, representing a roughly 5% share of the MSM’s capitalization of just over RO 10 billion (~US$25.9 billion) then.