Toyota Motor Corp plans to sell Islamic bonds in Malaysia, setting up a shelf registration of 1 billion ringgit ($311 million), the Nikkei business daily reported on Monday. The world's biggest automaker is expected to start selling such bonds through its financial arm as soon as this month, the Nikkei said. Toyota will use the proceeds to make auto leases and loans in Malaysia. Through the shelf registration, Toyota will be able to issue commercial paper and corporate bonds with maturities of up to seven years. The Bank of Tokyo-Mitsubishi UFJ Ltd.'s local unit and Malaysian investment bank CIMB Group will manage the sale. Aeon Credit Service Co Ltd, a consumer credit company affiliated with retail group Aeon Co Ltd, has already sold Islamic bonds and Toyota's planned issuance should help the Japanese Islamic bond market to grow, the Nikkei said. Toyota Financial Services Corp. aims to offer the bonds on May 20, Shuichi Nishimura, vice president of the unit's corporate planning division, said on Monday by phone. The bonds comply with Shariah law. Toyota, the world's second-largest automaker, fell 1.2 percent to 5,200 yen as of 1:14 p.m. in Tokyo. The shares have fallen 14 percent this year. The program, to be effective for seven years, will include commercial paper with maturities of up to 12 months and medium-term notes that mature in up to seven years.
