U.K.-based Islamic bank Al Rayan Bank Plc issued £250 million worth of sterling-denominated Islamic bonds, or sukuk, becoming the first bank to issue a public sukuk in a non-Muslim country.

The notes, priced at sterling three-month LIBOR plus 0.8%, is the bank's inaugural securitization of residential finance-backed security, and has an expected called weighted average life of three years.

The transaction was oversubscribed, with final demand at 155% of book.

The proceeds from the issuance will be used to fund further growth At Al Rayan Bank, a unit of Masraf Al Rayan (Q.P.S.C.).

Norton Rose Fulbright served as legal adviser for the issuance, while Standard Chartered Bank was the joint lead manager for distribution.