Dubai: JPMorgan Chase & Co., the biggest arranger of bond issues in the six-nation Gulf Cooperation Council, expects regional sales in 2017 to slip from last year’s record as some sovereigns scale back on jumbo-sized deals.

“We will probably not see the same issuers raising a similar amount this year,” Hani Deaibes, JPMorgan’s head of debt-capital markets for the Gulf region, said in an interview. “Having said that, a few people stayed away from the market last year, and these issuers will consider going to the market in 2017.”

A greater supply of Islamic bonds from the GCC in 2017 as investors seek to tap new pools of cash probably won’t be enough to compensate for smaller sovereign transactions, he said. The biggest US bank, which displaced HSBC Holdings Plc as the top Gulf debt arranger in 2016 after the British bank spent nine years at the peak, also expects more issues from government-related companies than last year.

GCC bond sales climbed to $72 billion in 2016 as governments tapped debt markets to bridge budget deficits caused by lower oil prices. Saudi Arabia, the world’s top oil exporter, raised $17.5 billion (Dh64.2 billion) in October in the biggest sale of debt securities from an emerging market, Qatar issued $9 billion in May, and Abu Dhabi another $5 billion in April.

Saudi Arabia will probably issue $10 billion to $15 billion of bonds in international markets this year, Economy Minister Mohammad Tuwaijri said in December. Kuwait is talking to banks to raise the equivalent of 3 billion dinars ($9.8 billion) of securities this year, while Oman has asked banks to submit proposals to arrange an international bond sale, people familiar with the planned issue said earlier this month.

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Some banks disagree with JPMorgan’s forecast that issuance may decline. Andy Cairns, the head of debt origination and distribution at National Bank of Abu Dhabi PJSC, said last month that overall bond issuance from the GCC may top last year’s levels, driven again by government sales. The governments of Dubai, Ras Al Khaimah and Kuwait, which didn’t issue last year will do so this year, and sales from corporates and financial institutions will also be higher than last year, he said.

While HSBC was displaced by JPMorgan at the top of the Gulf bond-league table, a list that ranks banks according to the amount of money they helped clients raise, it still managed to arrange more transactions, clinching 47 versus JPMorgan’s 34, according to data compiled by Bloomberg.

“We’re not league-table driven,” JPMorgan’s Deaibes said. JPMorgan focuses on some key, core customers in the Gulf and “we had a year where we saw significant issuance by these clients, which worked well for us.”

- Bloomberg