UPDATE 1-Saudi SABIC wins $1.3 bln Islamic-bond sale nod

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MANAMA, April 28 (Reuters) - Saudi Basic Industries Corp 2010.SE (SABIC) won regulatory approval to sell Islamic bonds worth as much as 5 billion riyals ($1.33 billion), the kingdom's stock market regulator said on Monday.

In July, the world's largest chemical company by market value said it planned to raise up to $5 billion through a programme of Islamic bonds to fund expansion.

That month, the company sold Islamic bonds, or sukuk, worth $2.13 billion.

There has since been a lull in sukuk sales after a global credit crunch triggered by defaults in U.S. home loans, but a handful of firms have come to market with sukuk offerings in recent weeks.

Sukuk comply with Islam's ban on the payment or receipt of interest, and returns are derived from underlying physical assets.

The approval was posted on the Saudi bourse website.