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Ras Al Khaimah plans 10-year sukuk issuance: The Investment and Development Office of Ras Al Khaimah (IDO) is planning on issuing a 10-year Reg S USD-denominated benchmark sukuk issuance, which is set to be listed on Nasdaq Dubai, Zawya reports.
Advisors: The IDO tapped banks including Abu Dhabi Commercial Bank, Citibank, Emirates NBD Capital, First Abu Dhabi Bank, The National Bank of Ras Al Khaimah (RAKBANK), and Standard Chartered Bank — all of which have been appointed as Joint Global Coordinators. Citi and Emirates NBD Capital are also acting as Sukuk Structuring Agents.
A Reg S issuance? A USD-denominated Reg S issuance is a subordinated USD-based financial instrument offered to non-US investors.
This year has seen several sukuk issuances from local banks, though this is the first government issuance this year. In January, First Abu Dhabi Bank priced a USD 600 mn five-year sukuk amid strong demand with a profit rate of 5.2%. The sukuk — which was 2x oversubscribed, with initial pricing of T+100 bps — will list on the London Stock Exchange. Real estate developer Damac also recently priced its USD 750 mn senior unsecured Reg S sukuk, which is set to be listed on Euronext Dublin.
UAE-based issuers’ total sukuk issuance volume hit USD 14.4 bn in 2024, with S&P Global Ratings projecting that this volume will remain steady at USD 14-15 bn in 2025, “underpinned by banks and corporate issuances.”
We have also seen a flurry of Reg S issuances from regional banks: Abu Dhabi Commercial Bank in February raised USD 600 mn through a five-year floating-rate Formosa bond at SOFR +105 bps, while First Abu Dhabi Bank priced USD 750 mn in senior unsecured notes in January, listed in Taipei and London at SOFR +100 bps. Aldar Properties also issued USD 1 bn in Reg S hybrid capital notes — marking the largest conventional hybrid issuance in the Middle East, with USD 4.9 bn in orders (3.8x oversubscription).
More to come: Sharjah Islamic Bank (SIB) also plans to list a USD 500 mn Reg S five-year sukuk on Euronext Dublin and Nasdaq Dubai, with initial pricing set at T+1.25%. Meanwhile, Emirates NBD is set to issue USD 1 bn in Reg S additional tier 1 capital securities last week, with initial price thoughts of 6.25%.
