The UAE Ministry of Finance (MoF), in partnership with the Central Bank of the UAE (CBUAE) as the agent for issuance and payment, has revealed the outcomes of the auction for Islamic Treasury Sukuk (T-Sukuk) denominated in UAE dirhams, totaling AED1.1 billion ($299.4 million).
This issuance is part of the Islamic Treasury Sukuk program for the third quarter of 2024, as detailed on the Ministry’s website.
The auction further demonstrated robust interest from eight primary bank dealers for the tranche set to mature in May 2027, along with a new five-year tranche maturing in September 2029. Bids amounted to AED5.07 billion ($1.38 billion), surpassing the subscription volume by 4.6 times. Additionally, the auction’s success is highlighted by the competitive market prices achieved, with a yield to maturity (YTM) of 3.67 percent for the May 2027 tranche and 3.65 percent for the September 2029 tranche, reflecting a spread of 13 to 15 basis points over U.S. Treasury bonds of comparable maturities at the time of issuance.
At the conclusion of the 'Customer Councils' initiative, the #MoF The Islamic Treasury Sukuk Auction continues to achieve record numbers! In September, the value of bids exceeded 5 billion dirhams, marking another significant success for the #MoF. Discover the results. pic.twitter.com/HlVIrDeLyw
— وزارة المالية | الإمارات (@MOFUAE) September 26, 2024
Moreover, these local currency-denominated Islamic Treasury Sukuk foster the creation of a UAE dirham-denominated yield curve, providing secure investment options for investors. This initiative further enhances the competitiveness of the local debt capital market, improves the investment climate, and supports sustainable economic growth.
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