Norton Rose Fulbright advises on first Basel III compliant tier 2 sukuk in Turkey

Business December 1, 2015

Global law firm Norton Rose Fulbright has advised Albaraka Türk Katılım Bankası A.Ş. on their issuance of US$250 million Reg S fixed rate resettable tier 2 sukuk due 2025.

The sukuk, while backed by the credit of Albaraka Turk as obligor, was issued by Albaraka Sukuk Ltd. and represents tier 2 capital for Albaraka Turk in accordance with the Basel III capital standards. The sukuk will pay a profit rate of 891bps over the five year US dollar mid swap rate. The sukuk represents Albaraka Turk’s third international sukuk issuance following the issuance of their tier 2 sukuk in 2013, and their senior sukuk in 2014, on which Norton Rose Fulbright also advised.

The Sole Global Coordinator was Standard Chartered Bank and the Joint Lead Managers and Joint Bookrunners were Barwa Bank, Dubai Islamic Bank, Emirates NBD Capital, Nomura International plc., Noor Bank, QInvest and Standard Chartered Bank.

Gregory Man, partner in the Dubai office, commented: “We were pleased to be able to assist Albaraka Turk in executing this transaction in order to add to their capital base. This is only the second Basel III compliant tier 2 deal to come out of Turkey, and the first in sukuk format. The transaction represents another landmark deal in the Turkish market and builds on our firm’s growing reputation in Turkey.”

The team was led by capital markets partner Gregory Man with assistance from senior associates Diane d’Almeida and Ahmet Kalafat and associates Tom Burke and Jake Jackson.

Paksoy Ortak Avukat Bürosu advised Albaraka Turk on the Turkish law aspects of the deal. Clifford Chance LLP and Yegin Çiftçi Attorney Partnership advised the Joint Lead Managers on English law and Turkish law aspects respectively. Clifford Chance LLP also advised Deutsche Trustee Company Limited as Delegate. Maples and Calder provided Cayman law advice.

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