The Jeddah-based Islamic Development Bank (IDB) plansto sell $500 million of Islamic bonds by the end of June, its first debt offering this year. Proceeds from the sale will be used to fund the bank's projects in member countries, Mohammed Tariq, director of the Treasury Department said in an interview in Singapore on Thursday. The bank plans to raise as much as $5 billion over the next five years through 2014 to expand lending, President Ahmad Mohamed Ali Al-Madani said separately at the Islamic Financial Services Board summit. Sales of the so-called Sukuk may rise to a record this year, led by issuers from the Gulf, as higher yields attract investors, Saudi Arabia-based NCB Capital said in March. Bahrain's sale of $500 million in sovereign Islamic bonds is receiving “strong” interest from investors who have been starved of new issues amid the global credit crisis, Central Bank Governor Rasheed A-Maraj said Thursday. Islamic bond sales fell 21 percent to $3.4 billion this year after plunging 55 percent last year as the global credit crunch sapped investor appetite for all but the safest debt and an oil price slump eroded Middle Eastern wealth. Bahrain's global sovereign Sukuk will be the second of 2009 after Indonesia raised $650 million in April from its first sale of the securities. The Islamic Development Bank also plans to start a new $1.5 billion to $2 billion infrastructure fund that will invest in infrastructure projects in member countries, Tariq said. “It is actually a private equity-type of fund where participants from the public and private sector will come along as joint investors,” he said, without providing a date. “It will be for individual projects.” Al-Madani said the bank plans to raise at least $1 billion a year from its proposed five-year bond program. The debt will be denominated in US dollars and in euros, Tariq said. Sukuk are typically asset-based securities that pay a profit rate to investors. The bank sold $500 million of Islamic bonds in 2005, according to its website. Bahrain's bonds may be sold by the first week of June, Al-Maraj said. Indonesia's first Sukuk sale drew orders for $4.7 billion, seven times the securities on offer, Rahmat Waluyanto, director general of the debt management office, said last month.