THAILAND TO ISSUE SUKUK BONDS

BANGKOK, March 26 (Bernama) -- The Islamic Bank of Thailand (IBT) plans to
raise between US$70 million to US$200 million via Sukuk Islamic bonds in
Malaysia and Middle East countries by this year.

Malaysia's second largest banking group CIMB, and its newly-acquired
BankThai, had approached the IBT to launch the Sukuk bond in Malaysia.

IBT chairman Professor Somchai Virunhapol said this would be the first time
Thailand was issuing Sukuk bonds, adding that other targeted countries besides
Malaysia were Kuwait, Bahrain and the United Arab Emirates (UAE).

"We have already held talks with CIMB on the scope of cooperation, but no
figures have been discussed as yet. Similarly, we received very good response
from the Middle East countries during our visit there a month ago," he said on
the sidelines of the Third Thailand Islamic Finance Conference here Thursday.

According to reports, in 2007 alone, CIMB arranged more than US$4.96 billion
worth of Islamic bonds globally, equivalent to 16 percent of the world market,
and of which US$4.67 billion was issued in Malaysia.

The global Islamic financing products are estimated at US$1 trillion, with
annual growth of between 10 to 15 percent.

Somchai said there was big potential for Sukuk bonds and other Shariah
compliant financing products in the country.

The Thai government, he added, had estimated that about 20 percent of
financing for a projected US$100 billion investment in mega projects over the
next 10 years, would come from such financing products.

About 50 percent of the investment is expected to go towards the
transportation sector, namely for the construction of new railway tracks and
trains, subway lines and airport, as well as 25 percent each for the energy and
other sectors.

According to Somchai, even though the world was experiencing an economic
crisis which had affected the conventional financing system, the Islamic bond
market remained strong, especially in the cash-rich Middle East countries.

He also said that the IBT planned to open three new branches this year from
its current 26, adding that it currently has over 100,000 savings account
holders.

"There are about eight million Muslims in Thailand and we are tapping a
niche market with very big potential," he explained.

Somchai, however, said that the Thai Finance Ministry had to waive taxes
such as the specific business tax and capital gains tax before Sukuk bonds could
be issued.

The IBT was established in 2003 to offer financial services in compliance
with Islamic law and to serve the country's Muslim population.

The Thai Finance Ministry is the largest shareholder with a 48.54 percent
stake in the bank.
-- BERNAMA