Greater Amman Municipality to issue 400 million JOD in Islamic Sukuk

The Jordanian Cabinet, chaired by Prime Minister Dr. Jafar Hassan, has approved the issuance of Islamic finance Sukuk by the Greater Amman Municipality. The issuance is valued at 400 million Jordanian dinars using an Ijarah Muntahia Bittamleek (lease-to-own) structure, featuring an annual return of 5.5% over a five-year term.

This marks the first issuance of its kind in the Kingdom for a public municipality. The initiative aims to enhance financial management efficiency, reduce costs, and leverage local Islamic finance opportunities in alignment with the national economic modernization vision. The Greater Amman Municipality established a dedicated Islamic Sukuk company to manage the projects in accordance with Islamic finance laws and best practices.

The Central Bank of Jordan will manage the issuance in the market, targeting banks, insurance companies, and investment funds. Once issued, the Sukuk will be tradable on the Amman Stock Exchange. The move is expected to reduce financing costs for the municipality by approximately 70 million dinars over five years, with potential savings reaching 140 million dinars if extended for an additional five years.