Demand for Islamic bonds (sukuk) will increase from next year when foreign investors are expected to tap Gulf Arab markets, a top banker said.

Simon Eedle, managing director of Global Islamic Banking at Calyon, told the Reuters Islamic Banking and Finance Summit in Bahrain that foreign investors would be issuing sukuk to tap the Gulf Arab region's ample liquidity compared with other markets.

'Once we got the market functioning ... there is going to be a huge opportunity for the right sectors and the right names to tap that Islamic wealth,' he added.

He said a new investor base in the Gulf Arab region is emerging that includes pension funds and Islamic insurers.-Reuters