Global Sustainable Tier 2 Subordinated Sukuk Issuance, a first in Turkey and in the world, in line with Kuveyt Türk's participation finance principles, was deemed worthy of the 'Transaction of the Year' award at the Bonds, Loans & Sukuk Middle East organization, one of the global organizations organized by GFC Media, one of the leading publishing companies in the financial markets. The source obtained from sustainable sukuk is used in green and social project financing, especially in renewable energy financing.
Introducing Turkey to the interest-free capital markets by making the first sukuk transaction of Turkey and Continental Europe in 2010, Kuveyt Türk was awarded the 'Deal of the Year' award by Bonds, Loans & Sukuk in the Middle East stage of the organization, with Turkey's and the world's first Global Sustainable Tier 2 Sub-Equity Sukuk Issuance, which was another first in the field of sukuk. Kuveyt Türk's award was presented to Executive Vice President of Treasury and International Banking Dr Ruşen Ahmet Albayrak and Manager of Financial Institutions Turgay Çavaş at the Bonds, Loans & Sukuk award ceremony held in Dubai.
More than $4.3 billion in demand was received
More than 150 investor institutions from a wide geography including Continental Europe, the United Kingdom, America, Asia and the Gulf participated in Kuveyt Türk's sustainable sukuk issuance with a maturity of 10 years and an early redemption option at the end of the 5th year, amounting to USD 350 million last year, with a demand of over 4.3 billion dollars. Thanks to the intense interest of the investors, the demand amount exceeded 12 times that of the sukuk issuance and brought Kuveyt Türk the best Tier 2 pricing that has been exported from Turkey since 2017, with 6.15%. In the issuance, which reached a wide audience, investor diversity was ensured and distribution was made to nearly 100 investors, while 20% of the distribution was made entirely to green/social fund investors.
The resource is transferred to green and social projects
Kuveyt Türk has taken a new step in the field of sukuk with the transaction, which is the world's first Sustainable Tier 2 Sukuk Issuance. The main point that distinguishes the transaction from other sukuk issuances of Kuveyt Türk and the market is that it has an ESG (Environmental-Social-Governance) structure. The source obtained from sustainable sukuk is used in green and social project financing, especially in renewable energy financing. Related projects are selected in accordance with participation finance principles, as well as Kuveyt Türk's Sustainable Finance Scope Document and the second party opinion received from a global environmental consultancy firm. Sustainable sukuk issuance with an ESG structure also demonstrates the support of Kuveyt Türk, which has a strong SME portfolio and is also one of the sector leaders in renewable energy funding, for both green and social funding.