The International Finance Corp (IFC), the World Bank's lender to the private sector, has started work on a return to the market for Islamic bonds, or sukuk, with plans to issue sharia-compliant debt after summer in the Gulf region.

Last year an IFC official said a deal was in the early stages of discussion, which would be the third time the World Bank's development division issues sukuk.

"We are hoping for an issuance soon after the summer. This is very much work in progress and as you can imagine much depends on underlying assets and market conditions," said Alexandra Klopfer, a spokeswoman for the IFC in Washington.

Details such as currency, tenor and size were not yet available.

The IFC, which aims to spur private investment in developing countries, last sold a $100 million five-year sukuk in 2009, listing it on the Dubai and Bahrain bourses.

Its first sukuk came in 2004 in Malaysia, a 500 million Malaysian ringgit ($134 million) three-year deal.

The issue is timed for after the summer because the Gulf region's capital markets slow down for the holy month of Ramadan, which started last week, and the long summer break away from the desert heat.

In December, the International Finance Facility for Immunisation Co (IFFIm), for which the World Bank acts as treasury manager, issued a $500 million debut sukuk.

At the time, IFFIm also said it was open to a return to the sukuk market. – Reuters