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UAE's banking giants have been busy tapping markets with their debt offerings, with FAB launching a five-year $500 million sukuk. Image Credit: Supplied

Abu Dhabi: First Abu Dhabi Bank has followed its Dubai rival to the debt market by starting to market dollar-denominated Islamic bonds on Thursday.

Abu Dhabi's biggest lender opened books on a $500 million five-year sukuk, setting initial price guidance at between 100 and 105 basis points over midswaps, according to a person familiar with the matter. A senior unsecured debt sale is expected to be closed on Thursday.

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Gulf banks are joining a wave of global borrowing after yields crashed following unprecedented stimulus by authorities to keep economies afloat during the coronavirus pandemic. Emirates NBD raised $750 million this week in the Middle East's first dollar bond sale of 2021.

Governments and companies in the Gulf will issue about $120 billion of dollar debt and Islamic securities this year, according to Franklin Templeton. That compares with a record $126 billion last year.