Abu Dhabi Islamic Bank (ADIB), a top-tier Islamic financial services group, has announced its first new Sukuk issue since 2006. The five-year Sukuk, rated A2 by Moody's and A+ by Fitch with a stable outlook from both rating agencies, will mature in November 2015. The US$750 million issue was priced at an expected profit rate of 3.745%, which is one of the lowest profit rates achieved for a five-year offering by a GCC Bank, and was oversubscribed by approximately 4.8 times.
Commenting on the strong demand for the ADIB issuance, Tirad Mahmoud, CEO of ADIB, said: "I am delighted that ADIB's return to the international capital markets was supported by extremely strong investor demand from across the Middle East, Europe and Asia. This is a testament to investors demand for ADIB's rare, and highly rated, credit. Moreover, this success highlights the investor confidence in Emirate of Abu Dhabi's vision and fundamentals and ADIB's status as Abu Dhabi's flagship Islamic Bank. With an orderbook of USD3.6 billion and an expected spread of 225 basis points over mid swaps, we have successfully diversified and extended the tenor of our funding base and this will enable ADIB to maintain its already successful customer centric growth strategy."
The book-runners for the Sukuk were Barclays Capital, HSBC (B&D) and Standard Chartered Bank and the co-leads were LMH and Nomura.
In conclusion, Tirad said: "While ADIB's new Sukuk issuance meets the strict investment guidelines of Islamic asset managers, pension funds and other investors, it attracted interest from a broad range of investors, including Central Banks, Banks, Asset Managers, Hedge Funds and Private Banks. We will build our relationships with our new partners and will involve them in our forthcoming initiatives and issuances and ADIB's geographic reach continues to grow."