FAB issues 5-year USD 500 million Sukuk
Lowest-ever yield on any five-year MENA bank USD issuance with a USD 500 million five-year Sukuk issued at MS+90bps
- The lowest-ever yield on any five-year MENA bank USD issuance
- Issued at MS+90bps (all-in yield of 1.411%)
- Three times oversubscribed with a total order book of circa USD 1.5 billion.
- FAB’s first USD benchmark offering in 2021 and first global Sukuk issue of the year
FAB issues 5-year USD 500 million Sukuk
First Abu Dhabi Bank (FAB), the UAE’s largest bank and one of the world’s largest and safest financial institutions, has issued the lowest-ever yield on any five-year MENA bank USD issuance with a USD 500 million five-year Sukuk issued at MS+90bps (all-in yield of 1.411%) through FAB Sukuk Company Limited.
The deal is FAB’s first USD benchmark offering and the first Sukuk issue globally in 2021. This offering was highly successful, attracting a total order book of circa USD 1.5 billion, representing a three times over-subscription rate. The deal also attracted high quality Islamic and conventional investors from the Middle East, Asia, UK and Europe.
Pricing on the deal at MS+90bps represents a negative new issue premium compared to FAB’s January 2025 maturity Sukuk, which was trading at MS +104bps on the deal announcement day. This resulted in FAB printing the lowest-ever yielding five-year USD bank paper from MENA. The Sukuk was placed to a diversified investor base of which 53% was international, and 47% was regional. The placement to Islamic investors was 76% signifying FAB’s appeal to Sharia-compliant liquidity pools globally.
Rula Al Qadi, Managing Director & Head of Group Funding at FAB said: “We are very pleased with the outcome of our Sukuk issue. Coming in the first week of January, we managed to take advantage of market conditions and print a deal roughly 20bps inside our curve. Once again, we had tremendous support from investors globally – both Islamic and conventional – which is testament to FAB’s strong credit fundamentals and the overall positive view of Abu Dhabi and the UAE economy by international investors.”