Mashreq and Rakbank are the latest names to tap debt markets flooded with demand

Our friends at Mashreq and Ras Al Khaimah’s Rakbank added their names to the UAE’s swelling debt issuance ledger this week, as the market rush that began after the Iran-war-era freeze continues ahead of an expected summer lull.

Mashreq priced a USD 500 mn perpetual non-call 5.5-year AT1 at a 6.625% coupon, tightening from initial price guidance in the 6.875% area, with the final orderbook exceeding USD 1 bn, Zawya reports. Rakbank, meanwhile, raised USD 600 mn through a five-year senior unsecured note at a 5.375% coupon — priced at UST+125bps, well inside the UST+155bps area where books opened — with demand exceeding USD 1.2 bn, Zawya reports separately.

The two issuances cap a frantic few weeks for UAE debt. Dubai Islamic Bank raised USD 1 bn through a perpetual non-call six-year AT1 sukuk at a 6.25% rate, with the orderbook peaking at over USD 2.3 bn. FAB also priced USD 750 mn in Tier 2 capital securities — its second issuance in June alone, following a EUR 750 mn green bond earlier this month. Outside of the banking world, Abu Dhabi-listed healthcare group Burjeel issued a USD 500 mn sukuk — the opening tranche of a USD 1.5 bn borrowing plan it had shelved when the Iran war began in February.

Why it matters: The oversubscription ratios across all five issuances tell the same story: there is plenty of appetite to go around for UAE paper. Spread compression on both the Rakbank and Mashreq issuances — each pricing well inside initial guidance — suggests that appetite isn’t just broad but price-insensitive.

Worth noting: Mashreq’s February AT1 came at 6.25%; this week’s equivalent instrument priced at 6.625%. The timing is crucial here: The lender’s last AT1 issuance was launched ahead of the Lunar New Year break, the start of Ramadan, and an expected wave of competing supply from other UAE banks. Today, it comes amid a wave of issuances, and though the market is hungry, it’s pricing in some macro uncertainty.

What to watch: How long the window stays open, especially if geopolitical uncertainty continues, and how many corporates and banks follow with more issuances.

ADVISORS- Abu Dhabi Commercial Bank, Arab Banking Corporation, Citi, Emirates NBD Capital, First Abu Dhabi Bank (FAB), ICBC, ING, JPMorgan, Mashreq, Standard Chartered, and Rakbank acted as joint bookrunners on the Rakbank issuance. Meanwhile, ADCB, BBVA, Barclays, Bank of America, Crédit Agricole, Emirates NBD Capital, FAB, Mashreq, and Standard Chartered ran the books on the Mashreq AT1, with BofA acting as billing and delivery bank.