Dubai Islamic Bank lists $750mn Sukuk on Nasdaq Dubai

By Arya M Nair, Official Reporter
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Dubai Islamic Bank (DIB), Dubai’s first Islamic financial institution, has listed a $750 million Sukuk on Nasdaq Dubai, the region’s international financial exchange.

The 5-year new Sukuk issuance, which is part of DIB’s $7.5 billion Sukuk Program, is UAE’s first Sukuk issuance in 2022 that has been priced at a profit rate of 2.74 percent per annum, 95 basis points over the 5-years US Treasury representing the lowest-ever credit spread on any of DIB’s fixed-rate senior Sukuk issuances.

The issuance was oversubscribed by more than 2.5 times, demonstrating the bank’s solid credit profile and attractiveness to international and regional fixed-income investors. The new listing strengthens Dubai capital markets’ status amongst the leading Sukuk listing venues globally with a total value of $79.19 billion.

DIB continues to be the leader in Islamic finance, with an established and strong investor following from Europe, Asia and the Middle East. Despite investor concerns around the global interest rate environment, DIB successfully priced its Sukuk earlier this week, with no new issue premium.

The Sukuk was priced after completing a comprehensive marketing exercise where DIB updated investors on its positive financial performance, especially during the last year.

Bank ABC, Dubai Islamic Bank, Emirates NBD Capital, First Abu Dhabi Bank, KFH Capital, HSBC, Sharjah Islamic Bank, Standard Chartered Bank and The Islamic Corporation for the Development of the Private Sector (ICD) acted as Joint Lead Managers and Bookrunners on the transaction.

According to Fitch Ratings, global Sukuk issuances increased by 36.1 percent to $252.3 billion in 2021 and are likely to continue expanding this year due to strong Islamic investor demand. Sukuk issuance in the region is also being boosted by goals to diversify funding and Islamic finance development agendas.

Related: Dubai Islamic Bank joins ‘UAE Trade Connect’ to boost financial stability