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Kitty Ussher, City Minister, today hosted the first meeting of the Islamic Finance Experts Group. The Group was set up to act as an industry sounding board for HM Treasury and the Financial Services Authority (FSA) on Islamic Finance. The focus of today's meeting was the Government's feasiblity study into issuing sovereign sukuk.
Speaking after the Islamic Finance meeting, Kitty Ussher, Economic Secretary to the Treasury said:
"The UK is at the forefront of developments in Islamic Finance and London continues to seize new opportunities - two of the largest sukuk issued in the first half of this year were listed in London.
"The announcement of the feasibility study into the Government issuing sovereign sukuk has generated a huge amount of interest and enthusiasm. Today, we discussed issuance options and parameters, and potential benefits for the City and retail investors. It was a very informative meeting and we shall continue to listen to a wide range of views before making a decision on whether to issue the first sterling sovereign sukuk."
The Group had a detailed discussion on the feasibility study into the potential issue of sovereign sukuk. The discussion centred on the potential benefits for the City and retail customers of the Government issuing sovereign sukuk. They were informed that the study would take into account the Government's debt management policy, size and nature of potential demand, potential cost and risk characteristics, implications for the Government's financing strategy, experiences of other sukuk issuers; and impact on the markets.
The feasibility study was announced on 23 April and will report on progress at the time of the Pre-Budget Report 2007.
The Group also discussed recent market developments and how the business and Islamic community could continue to work togther in partnership to drive Islamic Finance forward in the UK.
The Government's aims for Islamic Finance are:
* to entrench London's position as a global gateway for Islamic
Finance as part of the city competitiveness agenda being pursued by
the Chancellor's High Level Group; and
* to create a level playing field for alternative finance and investments, such as Islamic Finance, in the retail market. HM Treasury, the FSA and HM Revenue & Customs (HMRC) will together take forward this agenda and continue their strong and beneficial dialogue with the industry.
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