Dubai Islamic Bank, which has an “A3” rating by Moody’s, and an “A” rating from the “Fitch” credit rating agency, announced its success in pricing its second issuance of sustainable sukuk, valued at $1 billion, with a maturity of five and a half years. year, at a profit rate of 4.80% annually, which is 102.4 basis points higher than US Treasury yields for more than five years.
The bank stated that the sukuk was issued in accordance with Dubai Islamic Bank’s sustainable financing framework, which was developed to facilitate financing related to environmental and social initiatives and projects.
He explained that the issuance was characterized by many advantages, including that it is the largest issuance by a banking institution from the Middle East in the international capital markets since June 2021, and the largest sustainable issuance ever by a financial institution in the Middle East.
The largest IPO
Dubai Islamic confirmed that the issuance proved once once more the bank’s leadership in the Islamic and sustainable financing sector, as it witnessed great demand and interest from investors from Europe, Asia and the Middle East.
He pointed out that the sukuk was priced following the completion of a comprehensive marketing campaign, during which Dubai Islamic briefed investors on its strong financial performance and sustainable financing framework. The subscription witnessed a great turnout from investors, as despite the increase in the volume of the issuance (to reach one billion dollars), the subscription was covered by more than three times, which in itself represents the largest subscription by a Gulf bank in more than a year.
Sustainability agenda
Dr. Adnan Chilwan, Group Chief Executive Officer of Dubai Islamic Bank, said: “The issuance is driven by a balanced, detailed and carefully developed growth strategy, in addition to the bank’s firm commitment to achieving the sustainability agenda in the UAE, leading to the country’s ultimate goal in this field by achieving climate neutrality in 2050.” .
He added, “While our first issuance of sukuk in 2022 reflected the market’s confidence in the capabilities of Dubai Islamic Bank, and the great position it enjoys in the local and global capital markets, the recent offering witnessed a great turnout from investors, as the demand exceeded three billion US dollars.” This allowed us to increase the issuance volume within our target price range.” Chilwan thanked the investors for their continued trust and faith in Dubai Islamic Bank, stressing the bank’s commitment to playing an active role in achieving the UAE’s long-term sustainability goals, at a time when the UAE is preparing to host the United Nations Climate Conference (COP 28).
Release managers
According to “Dubai Islamic”, the sukuk was issued under the Dubai Islamic Bank Limited’s sukuk issuance program, and was listed on both the “EuroNext Dublin Stock Exchange” and “Nasdaq Dubai”.
Standard Chartered Bank is participating as the sole regulator of sustainability, and Bank ABC (Arab Banking Corporation), Dubai Islamic Bank, Emirates NBD Capital, First Abu Dhabi, and HSBC have been authorized to And “KFH Capital”, “Al-Mashreq”, “Sharjah Islamic”, “Standard Chartered”, and the Islamic Corporation for the Development of the Private Sector, to act as joint lead issue managers and joint bookrunners for these sukuk.