UAE: FAB issues 5-year $800m sukuk, marks first for the year globally

First Abu Dhabi Bank (FAB) has issued a five-year $800m sukuk at US Treasury +85bps (basis points), one of the bank’s lowest spreads on any US dollar public deal.

It resulted in an all-in yield of 4.77 per cent.

This issuance marks the first sukuk issued globally in 2024 and is the region’s first offering for the year, reported state news agency, WAM.

The allocation directed to Islamic investors was 76 per cent, with 38 per cent towards international counterparts.

The order book for the sukuk, which was 1.9 times oversubscribed, represented top investors, comprising international fund managers, supranationals, and banks.

Rula AlQadi, group treasurer at FAB, said, “We’re thrilled with this successful sukuk issuance, the first of 2024 and a milestone for the bank.

“Securing our largest sukuk in four years and the lowest five-year public issuance spread in two years demonstrates investor confidence in the UAE and our creditworthiness. We deeply appreciate their continued trust.”

The bank also acted as joint lead manager on the sukuk issuance.

First ESG fund launched by the bank

In other news, the bank recently introduced its first ESG-oriented fund for its private banking clients, providing clients with access to sustainable investing.

The FAB Sustainable Development Goals Fund (FAB SDG Fund), managed by FAB Private Bank (Suisse) SA, aims to capture long-term investment opportunities that address the world’s major social and environmental challenges, as defined by the UN Sustainable Development Goals (SDGs).

Each underlying investment fund will be assessed for its alignment with the 17 UN SDGs and with FAB’s ESG strategy.