Dubai: Union National Bank (UNB) is eyeing a dollar-denominated benchmark bond issue after planned investor meetings next week, which will test market appetite for regional debt amid a charged global economic backdrop.
UNB has picked five banks for the potential issue, it said yesterday, with roadshows due to kick off on Sunday in Abu Dhabi and Dubai, followed by Asia.
Citi, Deutsche Bank, HSBC, National Bank of Abu Dhabi and Standard Chartered were given the mandate for the bond, which will be issued subject to market conditions following investor meetings.
Benchmark-sized is widely accepted to mean at least $500 million (Dh1.83 billion). UNB has a $1 billion term loan maturing in December, Thomson Reuters data showed.
Bank mandate
In July, Reuters reported UNB had mandated the same banks, with the exception of NBAD, for a potential issue. The bond would be the first international issue from the Gulf Arab region since First Gulf Bank sold $650 million in Islamic bonds, or sukuk, at the end of July.
A pipeline of bond issues from the region has been held up by global volatility, in particular Eurozone sovereign debt woes, leading borrowers to adopt a wait and see attitude and to wonder about the eventual cost.
"It is got to be a squeaky clean credit, at a concession," said one bank analyst speaking on condition of anonymity.
UNB shares are up 12 per cent this year.
The bank is majority-owned by the Abu Dhabi government through the Abu Dhabi Investment Council. The government of Dubai is a 10 per cent shareholder, Thomson Reuters data showed.
