The Muscat Stock Exchange (MSX) has seen an increase in activity in the first half of this year, with new bonds and sukuk worth OMR362.4 million being listed. These financial instruments were issued by the Central Bank of Oman, local banks, and public joint stock companies listed on the exchange. The goal of listing these instruments is to stimulate trading activity and encourage investors to diversify their portfolios. Bonds are used as a means of borrowing by governments or companies, with the issuer paying a predetermined interest throughout the bond’s term and returning the nominal value upon maturity. Sukuk are financing instruments compliant with Islamic law, where the holder receives a profit from the issuing entity.
The first half of this year saw the listing of 7 bond issues, including government development bonds and mandatory convertible bonds issued by various companies. Notably, Omani International Development and Investment Company (Ominvest) issued bonds for its shareholders as non-cash dividends. Ahli Bank, National Finance Company, Oman Financial Services Company, and Liva Group also issued bonds in the banking, finance, and insurance sectors. Additionally, Dhofar Insurance Company restructured its bonds following a General Assembly decision to convert part of the bonds into shares, leading to a reduction in the number of listed bonds.
In the Sukuk sector, the Muscat Stock Exchange listed the “Tilal” Sukuk and the third issue of the ‘Meethaq’ Sukuk in the first half of the year. The total market value of the bonds and sukuk market was OMR4.35 billion by the end of June 2024, experiencing a slight decline from the previous year. The decline was due to the cancellation of certain listed bonds, including perpetual bonds issued by Bank Sohar International and Ahli Bank. The market value of the bond and sukuk market represented about 18 percent of the total market value of securities listed on the Muscat Stock Exchange by the end of June 2024.
Moving forward, the Muscat Stock Exchange continues to provide a platform for listing bonds and sukuk to facilitate trading and investment opportunities for investors in Oman. By diversifying the available financial instruments on the exchange, traders can enhance their portfolios and explore new investment opportunities. These debt and financing instruments offer investors various options for generating profits, whether through fixed interest payments on bonds or profit-sharing from sukuk. As the market evolves, investors can look forward to further opportunities for growth and diversification in the bonds and sukuk sector.
In conclusion, the Muscat Stock Exchange’s initiatives to list new bonds and sukuk have contributed to the growth of the financial market in Oman. The diverse range of instruments available for trading provides investors with opportunities to expand their investment portfolios and explore different avenues for generating returns. As companies and institutions continue to issue bonds and sukuk, investors can benefit from the flexibility and liquidity of these financial products. The exchange’s efforts to support trading activity and foster a dynamic investment environment bode well for the future development of the financial market in Oman.
