First Abu Dhabi Bank (FAB) has kickstarted the global sukuk market in 2024 with the issuance of a five-year $800 million sukuk. This marks the region’s inaugural offering for the year. The bank’s strategic move underscores its commitment to Islamic finance and positions it at the forefront of global financial activities.
Impressive all-in yield
FAB’s sukuk issuance resulted in an all-in yield of 4.779 percent at 85 basis points over U.S. Treasuries. It demonstrates FAB’s ability to secure favorable terms in the market. Moreover, this issuance stands as one of FAB’s lowest spreads on any USD public deal, highlighting investor confidence in the bank’s robust creditworthiness.
Investor confidence
Investor confidence in FAB is evident with a final spread of 85 basis points over U.S. Treasuries. The allocation of the sukuk showcases diversity, with 76 percent directed toward dedicated Islamic investors and 38 percent toward international counterparts. The oversubscribed order book, by 1.9 times, reflects high-quality investors, including international fund managers, supranationals, and banks.
Rula AlQadi, group treasurer at FAB, expressed satisfaction with the successful sukuk issuance. She emphasized its significance as a milestone for FAB in 2024. Securing the largest Sukuk in four years and the lowest five-year public issuance spread in two years reflects investor trust in both the UAE and FAB’s creditworthiness.
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FAB’s position in Islamic finance
This sukuk issuance further cements FAB’s status as a leading Islamic finance provider and a trusted partner for investors globally. The bank’s proactive approach to Islamic finance aligns with its commitment to providing innovative and diverse financial solutions in the market.
In addition, FAB played a crucial role as a joint lead manager. Hence, it is showcasing its expertise and influence in the Islamic finance domain. The bank’s multifaceted involvement in the transaction reinforces its position as a key player in shaping the global Sukuk landscape.
As FAB sets the stage with the first sukuk of 2024, the successful issuance reflects the bank’s financial leadership role. It also serves as a positive indicator for the broader Islamic finance market, signaling a robust start for the year ahead.
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