Nomura's plans to diversify its funding geographically and by products.
Japan's Nomura Holdings on Thursday said it raised $70m through an Islamic financing instrument in the Middle East, a move that follows an Islamic bond sale earlier this month in Malaysia.
Nomura's Commodity Murabaha facility has a three year tenor offering a profit margin of 175 basis points per year and will be used for liquidity management purposes, the company said a statement. The bank had an initial target to raise $50 million.
"The issuance is part of Nomura's strategy to diversify funding both geographically and by product and comes at a time when we have simultaneously launched a sukuk in Malaysia," said Takuya Furuya, chairman for Middle East and Africa at Nomura.
Nomura is the first Japanese company to enter the Islamic funding market in the Middle East, the statement said.
ABC Islamic Bank, the Islamic finance subsidiary of Arab Banking Corporation, was appointed as the sole mandated lead arranger for the murabaha facility.
Nomura priced its two-year $100 million sukuk, or Islamic bond, at 160 basis points above LIBOR earlier this month, the first dollar-denominated sukuk by a Japanese firm out of Malaysia. (Reuters)