Malaysia hires banks to manage $2 bln sovereign Islamic bond issue-sources

DUBAI/KUALA LUMPUR, March 12 (Reuters) - Malaysia has hiredthree lenders to manage the issuance of a sovereign Islamicbond, or sukuk, of up to $2 billion, according to two sourceswith knowledge of the deal.

The banks are CIMB Group Holdings Bhd, HSBCHoldings Plc and Standard Chartered Bank Plc,according to the sources, who declined to be named as the matteris private. Debt maturity will be more than five years, thesources said.

Officials with CIMB and HSBC declined to comment. Officialsat Standard Chartered and the finance ministry were notimmediately available to comment.

Lower global energy prices have hit revenues for Malaysia, Southeast Asia's second-largest oil and natural gasproducer, and knocked the ringgit to a six-year low.

Problems stemming from a heavily-indebted investment fund,1Malaysia Development Bhd (1MDB) and the prospect ofthe first rise in U.S. interest rates in almost a decade, havealso added to the risk of a sovereign downgrade and capitaloutflows.

Government-owned oil and gas producer Petronas on Wednesdaysold a $5 billion four-tranche bond, including a five-yearsukuk, IFR, a Thomson Reuters publication reported on Thursday.

(Reporting by Archana Narayanan in DUBAI, Anuradha Raghu andYantoultra Ngui in KUALA LUMPUR; editing by Susan Thomas)