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| President Ruto asks treasury to set up islamic finance regulations |
President William Ruto has directed the National Treasury to work with financial regulators and islamic finance stakeholders in order to establish a centralised Shariah Governance Board.
Speaking during the listing of Kenya’s first islamic bond, LINZI Sukuk at the Nairobi Securities Exchange (NSE), the president said establishing a robust islamic finance regulatory
framework has tremendous potential to unlock investment
resources and boost the country’s economic growth.
“As a financial instrument compliant with Islamic law, the Sukuk
highlights the importance of Islamic finance in promoting
financial inclusion and broadening market access. This aligns
with the global move towards more stable and robust economic
growth, unlocking Islamic financial assets currently valued at
approximately $5 trillion,” said President Ruto.
The Ksh 3 billion LINZI Sukuk which has begun tradin on NSE is Kenya’s first Sharia-compliant bond.
The bond which has a coupon of 11.5pc and a tenure of 15 years is expected to finance the development of 3,069 affordable houses for the security forces.
The bond has been structured in a manner that will provide housing at an average cost of Ksh 1.4 million, enabling Kenyans to own homes by paying as little as Ksh 7,000 every month over a period of 15 years.
“This initiative not only makes homeownership more accessible but also represents a scalable model for investment in our affordable housing programme, attracting long-term investors, including local pension funds,” said President Ruto.
This comes as the government lines up listing of six state-owned enterprises on the NSE in coming months.
The government is expected to offload shareholding in East African Portland, NSE, Stanbic Holdings and Eveready East Africa through block trading.
By Ronald Owili and Caroline Njenga