Abu Dhabi: The UAE’s $1.5 billion dollar-denominated bond auction saw an oversubscription of five times and attracted bids of over $7.4 billion, the Ministry of Finance said on Monday.
The 10-year bond was issued with a yield of 4.917 per cent -- a spread of 60 basis points over US Treasuries – and will be listed on the London Stock Exchange (LSE) and Nasdaq Dubai. It will mature in September 2033.
Mohamed bin Hadi Al Hussaini, Minister of State for Financial Affairs, said: “The successful completion of another sovereign bond by UAE is a testament that UAE remains an attractive destination for investors and one of the World’s most attractive investment hubs.”
“The UAE has yet again achieved strong results in its recent bond offering attracting strong and diversified investors demand. The strong order book resulted in price compression of 25 basis points from the initial pricing guidance, with final pricing at US Treasuries plus 60 basis points.”
The issue was arranged and offered through a syndicate of joint lead managers and bookrunners comprising of Abu Dhabi Commercial Bank, BNP Paribas, Citigroup Global Markets, Emirates NBD Capital, First Abu Dhabi Bank, HSBC Bank, Goldman Sachs, Mashreq Bank and Mizuho.
The geographic allocation of the 10-year bonds was distributed as follows: 45 per cent for investors from the Middle East; 21 per cent for American investors; 11 per cent for Asian investors; 9 per cent for investors from the UK, and 14 per cent for European investors.
The final 10-year bonds allocation by type was distributed as follows: 61 per cent for banks and private banks; 32 per cent for fund managers; 4 per cent for pension funds and central banks, and 3 per cent for the insurance sector.
The notes will be rated AA- by Fitch, and Aa2 by Moody’s, in line with the credit rating of the UAE federal government.