GCC issuers raised more debt in 1H 2014, with Saudi leading the way

Sukuk and bond issuances by GCC countries grew 38% y-o-y to USD 75.5 bn in 1H 2024 with Saudi accounting for almost half of all sukuk and bond issuances out of the Gulf during the period, according to data from Kuwait Financial Centre (Markaz). The first six months of 2024 saw 173 primary debt issuances in the GCC, up from 130 in the same period last year.

Saudi issues led the market, raising USD 37 bn through 44 sales to account for 49% of the total amount raised in the GCC, according to Markaz. The UAE came second with a 27% share of issuances, raising USD 20.6 bn in 64 transactions.

How other GCC peers fared:

• Qatari issuers came in third with USD 10.5 bn raised across 39 transactions;
• Bahraini raised USD 3 bn from 4 issuances, Kuwait raised USD 2.6 bn from 15, and Oman raised USD 1.7 bn from an undisclosed amount of issuances.

Sovereign vs. Corporate: Sales by sovereign entities in the GCC grew 77% y-o-y during the period to USD 41.5 bn, accounting for 55% of total value of GCC primary issuances. The remaining 45% of primary issuances out of the GCC came from corporate issuers, which raised USD 34.0 during 1H 2024, marking a rise of 8% y-o-y.

Sales by issuers in the financial sector raised USD 28.8 bn, good for a 38% share of all funds raised in the period.

Conventional issuances made up 65% of total primary issuances in the Gulf at USD 48.8 bn — that’s up 56% y-o-y. Sukuk issuances totalled USD 26.6 bn to account for 35% of total issuances.

USD-denominated issuances accounted for 76% of total bond and sukuk sales, while SAR-denominated sales made up 12% of the total. (That’s in line with estimates by S&P Global, which said Saudi sukuk issuances more than tripled y-o-y in 1H 2024 to USD 10 bn.)

MARKETS THIS MORNING-

Asian shares opened lower this morning as investors around the world absorb the news that Joe Biden has dropped his bid for re-election — but futures for major Wall Street benchmarks were up across the board in overnight trading. In Europe, futures for the CAC 40 were the only losers overnight — left-wing politicians there are still trying to figure out how to put together a government after defeating a challenge from the far-right in snap elections.

THE CLOSING BELL-

The ADX rose 0.2% on Friday on turnover of AED 931.1 mn. The index is down 3.5% YTD.

In the green: Rapco Investment (+8.7%), Bank of Sharjah (+6.4%) and Apex Investment (+5.5%).

In the red: E7 Group (-6.6%), Fujairah Cement Industries (-3.4%) and National Corporation for Tourism and Hotels (-3.0%).

Over on the DFM, the index closed up 0.3% on turnover of AED 317.1 mn. Meanwhile Nasdaq Dubai rose 0.2%.

CORPORATE ACTIONS-

#1- DAE is buying back more of its bonds: Dubai Aerospace Enterprise (DAE) resumed its bond repurchase program this month, it said in a Nasdaq disclosure. The company is allowed to buy back up to USD 266 mn of its outstanding bonds and is now offering indicative bids via Bloomberg for bonds across different maturities.

REFRESHER- The company approved a USD 300 mn bond repurchase program back in 2018. It has since repurchased USD 1.2 bn of company bonds on the grounds that “their prices were misaligned with [the company’s] credit ratings.”

#2- GFH Financial Group appointed BHM Capital as liquidity provider for its listed shares on the DFM and ADX after receiving regulatory approval, according to a bourse disclosure (pdf).