Dubai: Emirates NBD Capital, the home-grown investment bank belonging to Emirates NBD Group made its mark as global player in dollar sukuk issuance by topping the global league for the first half of this year. Its success was reinforced recently when it topped the UAE league table in initial public offerings.
“The League Tables’ status we have achieved both on debt and equity is a testament to the fact that our structuring and advisory capabilities, coupled with our placement reach to investors globally, has successfully positioned us to become a one-stop shop for our customers in the region to service their requirements both around debt and equity” said Mohammad Kamran Wajid, CEO of Emirates NBD Capital
According to league tables published by Bloomberg, for the first half of 2014, ENBD Investment Bank arranged ten dollar sukuk issuances aggregating to $5.4 billion (Dh19.8 billion).
ENBD Capital had a very strong second half, arranging sukuk issuance for Indonesia, Goldman Sachs, DIFC and Fly Dubai among others.
“We expect a very close podium finish for 2014. Year to date, we have arranged 15 dollar sukuk, which is second highest number in the world,” said Wajid.
The revival of both debt capital markets (DCM) and equity capital markets (ECM) activity in the UAE and the region has seen ENBD Capital emerging a top performer in both the segments. In the UAE it has emerged top in initial public offerings and fourth in the GCC region in the Bloomberg league tables.
Investment banking business is witnessing strong growth across the world with the regional and global players benefitting from this overall revival in the industry.
“[The] investment banking business in the region is our space and the regional banks should lead it. International banks are welcome to partner with regional banks to complement the offerings”ĺsaid Wajid.
ENBD Capital has a strong competitive advantage in both regional and local market as it has strong relationship with most regional issuers, investors and has a deep understanding of the regional credit markets as the ENBD Group is one of the leading regional financial services entities.
Wajid says Dubai’s Islamic economy focus helping sukuk issuance and listing on Dubai bourses. Out of the total of $24 billion listed in Dubai approximately $12 billion were listed in 2014.
Historically sukuk issuance in the UAE and the region are largely driven by GREs and banks but ENBD Capital sees the trend is fast changing with more number of corporates tapping the market in recent years. Wajid expects, going beyond corporate issuers, the regional markets are expected to see project sukuk and bond issuances in the near future.
“We have brought a number of corporate issuers to the market such as DIP, Damac, Emaar Malls, Drake and Scull and Majid Al-Futtaim and non-UAE corporates such as Dar Al Arkan, AKLease and Turk Telecom. We expect this trend to continue,” he said.
Many corporates are taking advantage of the high liquidity in the banking system across the region and the relative price advantage. But he believes this is short term phenomenon.
“We believe the availability of longer bullet issuances in debt capital markets space, the ability to structure in unique securities like the hybrid perpetuals for MAF and GEMS will continue to motivate corporate issuances,” said Wajid.
After a long gap of more than five years equity capital markets are showing signs of revival. From a macro perspective Wajid says the revival of both regional ECM and DCM (deb is still at a nascent stage and expects both markets to continue to develop in the near future in terms of number of issues and size.
He said region-specific developments such as the MSCI upgrade of the UAE and Qatar, the partial opening up of the Saudi market and significant raising of foreign ownership limits in markets such as Qatar and UAE is are going to increase the depth of the regional capital markets.
“The MSCI upgrade is clearly positive for the ECM. We saw very strong international demand for [the] Emaar Mall IPO. We expect the impact to be more pronounced in the medium to long term,” he said.
