NEW YORK, March 6, 2006 (PRIMEZONE) -- Dow Jones Indexes and Citigroup Corporate and Investment Banking, both leading global index providers, today announced that they intend to launch the Dow Jones Citigroup Sukuk Index, the first index that seeks to measure the performance of global bonds complying with Islamic investment guidelines.
The index, which is intended to launch April 2, was created primarily for use as the benchmark for investors seeking exposure to Shari'ah-compliant fixed-income investments. In addition, the index may serve to increase secondary market trading in this growing asset class and facilitate cross-market relative value trading among different asset classes.
The Dow Jones Citigroup Sukuk Index will include investment-grade, U.S. dollar-denominated Islamic bonds-also known as Sukuk-issued in the global market. At launch, the Index will initially track seven issues: Islamic Development Bank, Solidarity Trust Services Ltd, BMA International Sukuk, Qatar Global Sukuk, Malaysia Global Sukuk, Sarawak Sukuk and Dubai Global Sukuk.
To be included in the Index, an Islamic bond must comply with both Shari'ah law and the Bahrain-based Auditing & Accounting Organization of Islamic Financial Institutions (AAOIFI) standards for tradable Sukuk. Once a bond meets these criteria, Dow Jones Indexes and Citigroup will apply market-based criteria such as minimum maturity of one year, minimum issue size of US$250 million, and an explicit or implicit rating of at least BBB-/Baa3 by leading rating agencies.
"Sukuk, or Islamic fixed-income securities, have emerged over recent years as an increasingly important asset class. It can be expected that we will see the issue of a significant number of corporate, quasi-sovereign and sovereign Sukuk in the future, along with the development of a liquid and efficient Islamic capital market," said Michael A. Petronella, president, Dow Jones Indexes/Ventures. "The cooperation with Citigroup to calculate and market the Dow Jones Citigroup Sukuk Index combines experience in the Islamic bond market with expertise in Islamic finance and indexing."
Mohsin Nathani, chief executive officer, Citi Islamic Bank, said: "We are delighted to offer our global index and Sukuk capabilities to the Islamic Banking industry in partnership with Dow Jones Indexes. The launch of the Index is in line with our strategy to offer Islamic issuers and investors world-class and innovative products that contribute to expanding the frontiers of Islamic capital markets."
The Dow Jones Citigroup Sukuk Index follows the same consistent, quantitative methodology as the Dow Jones Islamic Market Indexes, which are monitored to ensure their continued compliance with Shari'ah Law. Dow Jones Indexes launched the first Islamic indexes-the Dow Jones Islamic Market Index family-in 1999. Today, the Dow Jones Islamic Market Indexes are used by asset managers in 16 countries for a variety of financial products that screen out activities that are incompatible with Islamic investment guidelines. Excluded from the indexes are stocks of companies in these lines of business: alcohol, tobacco, pork-related products, financial services, defense/weapons, and entertainment. Also excluded are companies that fail any of three financial ratios.
Citigroup has been a leader in the Islamic Finance business for more than 20 years and successfully has arranged Islamic transactions for issuers in Europe, Asia, LATAM, Africa and the Middle East. Citigroup's Islamics operation began in 1981 in London, and in 1996 Citigroup was the first international institution to set up a separately capitalized Islamic Bank, Citi Islamic Investment Bank (CIIB). CIIB's core business has been the origination, structuring and distribution of Islamic banking transactions in structured trade finance, leasing, project financing, advisory services and Islamic securities.
Members of the Dow Jones Shari'ah Supervisory Board are: Sheikh Nizam Yaquby, Bahrain; Sheikh Dr. Mohd Daud Baker, Malaysia; Sheikh Justice Muhammad Taqi Usmani, Pakistan; Sheikh Dr. Mohamed A. Elgari, Saudi Arabia; Sheikh Abdul Sattar Abu Ghuddah, Syria; and Sheikh Yusuf Talal DeLorenzo, U.S.
End of day index values of the Dow Jones Citigroup Sukuk Index will be available on www.djindexes.com, via The Yield Book(r) fixed income analytical system (www.yieldbook.com) and via major data vendor services upon the launch of the Index.
Journalists may e-mail questions regarding this press release to PR-Indexes@dowjones.com or contact Dow Jones Indexes/STOXX press office:
New York: +1-212-597-5720 Frankfurt: + 49-69-97142815
Or to Citigroup media contacts:
New York: Joseph Christinat +1-212-816-6291 London: Jeremy Hughes +44-207-986-5607
Note to Editors:
About Dow Jones Indexes
Dow Jones Indexes is part of Dow Jones & Company, which publishes the world's most vital business and financial news and information. Dow Jones Indexes is a premier global provider of investable indexes, including the Dow Jones Averages and the Dow Jones Global, Regional, Country and Sector Titans Indexes and is co-owner of the Pan-European Dow Jones STOXX Indexes. Together with Wilshire Associates, Dow Jones Indexes markets and licenses the Dow Jones Wilshire index family, which includes the Dow Jones Wilshire 5000 and its size, style, and sector indexes. Dow Jones Indexes also offers a number of specialty indexes including hedge fund, commodity and credit derivative indexes.
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About Citigroup
Citigroup (NYSE:C), the leading global financial services company has some 200 million customer accounts and does business in more than 100 countries, providing consumers, corporations, governments and institutions with a broad range of financial products and services, including consumer banking and credit, corporate and investment banking, securities brokerage, and wealth management. Major brand names under Citigroup's trademark red umbrella include Citibank, CitiFinancial, Primerica, Smith Barney and Banamex. Additional information may be found at www.citigroup.com .
Citigroup Corporate and Investment Banking works closely with corporations, financial institutions, institutional investors and governments to enable them to achieve their strategic financial objectives. As an industry leader in global banking, capital markets, and transaction services, with a presence in many countries dating back more than 100 years, Citigroup Corporate and Investment Banking provides clients with cutting-edge ideas, best-in-class products and solutions, and unparalleled access to capital and liquidity.
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