FAB steps into debt market with $500mn sukuk

By Rahul Vaimal, Associate Editor
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First Abu Dhabi Bank, the largest bank in the UAE has stepped into the debt market following its Dubai competitors, by starting to trade dollar-denominated Islamic bonds.

Abu Dhabi-headquartered lender has opened books on a $500 million five-year sukuk and its initial price guidance is marked between 100 and 105 basis points over mid-swaps, according to a person related to the matter. A senior unsecured debt sale is expected to be closed on Thursday.

Dubai Islamic Bank, Emirates NBD Capital, First Abu Dhabi Bank, Islamic Corporation for the Development of the Private Sector, Kuwait Finance House Capital, NCB Capital and Standard Chartered Bank are the joint lead managers for the sale.

Currently, the gulf banks are following the wave of global borrowing as the revenue got crashed due to the unprecedented stimulus packages by the authorities to maintain a balanced economy during the crisis driven by the coronavirus pandemic. As per reports, the Dubai government-owned bank Emirates NBD had raised $750 million this week in the Middle East’s first dollar bond sale of 2021.

According to the US-based global investment firm Franklin Templeton, governments and companies in the Gulf region will issue nearly $120 billion of dollar debt and Islamic securities this year. that compares with a record $126 billion worth of issuance in 2020.

First Abu Dhabi Bank (FAB)

The largest bank in UAE, First Abu Dhabi Bank (FAB) was founded in 2017 as a result of the merger of First Gulf Bank and National Bank of Abu Dhabi. FAB offers financial solutions, products and services through its corporate and investment banking and personal banking franchises. The bank currently has its presence in five continents including Asia Pacific (APAC), Europe, the US, Middle East and Africa.