Dubai Islamic Bank successfully closes lowest-ever pricing on an AT1 issuance from the GCC

Dubai Islamic Bank successfully priced a landmark USD 500 million Perpetual Non-Call 5.5yrs Additional Tier 1 Sukuk with a profit rate of 3.375% per annum.

This transaction represents the lowest ever pricing achieved by a GCC bank (both conventional and Islamic) on an Additional Tier 1 instrument and the lowest ever on a USD AT1 Sukuk globally.  Despite the volatility witnessed in credit markets during the past month on account of US Treasury rates, achieving this landmark success in the current scenario is testament to the bank’s strong credit profile and standing with international and regional investors.

The deal was priced intraday after completing investor calls, which were attended by several local, regional and international investors.  Despite the record low yield, the Sukuk was 5.6x oversubscribed with an orderbook that peaked at USD 2.8 billion which is a further testament to investors reaffirming their commitment to UAE and DIB in particular.

Dr. Adnan Chilwan, Group Chief Executive Officer, DIB, commented, “We are very pleased with the outcome of our issuance today.  Given that markets had been fairly volatile during the last several weeks on account of underlying US Treasury rates rising rapidly, successfully executing this issuance at the lowest-ever pricing on a USD AT1 instrument is an achievement we are all proud of.  We are grateful to the investor community for their overwhelming response which is a clear testament to the confidence global markets place in the bank’s robust fundamentals, as well as investor comfort in the broader Dubai and UAE economy.”

The Sukuk is issued under DIB Tier 1 Sukuk (5) Ltd. and is listed on Euronext Dublin and NASDAQ Dubai.

Dubai Islamic Bank, Emirates NBD Capital, First Abu Dhabi Bank, HSBC and Standard Chartered Bank acted as Joint Lead Managers and Bookrunners on this transaction.