Govt raises Rs114bn via Hybrid Sukuk amid strong demand

April 30, 2026 (MLN): The Government of Pakistan raised Rs114.347 billion through the third auction of its Hybrid Sukuk on Wednesday, marked the second issuance of such instruments within the current month, supported by strong investor participation in Shariah-compliant securities.

The auction was conducted via the Pakistan Stock Exchange (PSX) on behalf of the Ministry of Finance (Pakistan), where total bids surged to Rs354.395bn (face value), translating into a realized value of Rs344.716bn, showing robust demand from market participants.

Meezan Bank Limited served as the Lead Joint Financial Advisor (JFA) for the issuance, contributing to the structuring and execution process and reinforcing its position in Pakistan’s Islamic capital market landscape.

According to auction results, the cut-off yield for the one-year fixed-rate (discounted) Sukuk was set at 12.00%, reflecting an increase of 20 basis points from the previous level.

For the 10-year Variable Rental Rate (VRR) Sukuk, the instrument was priced at 11.7568%, carrying a spread of 38.83 basis points over the reference rate of 11.3685%.

Market participants attributed the strong bidding activity to improving liquidity conditions and sustained institutional demand for Islamic investment instruments, particularly sovereign Sukuk offering diversified return profiles.

The Hybrid Sukuk structure, which integrates fixed and floating rate components, continues to support the government’s objective of broadening its Shariah-compliant financing base while catering to varied investor risk-return preferences.

The latest auction further underscores the government’s ongoing efforts to deepen the domestic Sukuk market and enhance fundraising through innovative Islamic financing instruments.

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