The UAE’ largest lender, First Abu Dhabi Bank (FAB), has launched $1 billion in Tier-2 bonds, showed a document from an arranging bank published by Reuters.
The bonds were launched at 170 basis points over U.S. Treasuries, tighter than the 200 basis points (bps) over the same benchmark released in a document earlier in the day.
Orders for 10-1/2 years non-callable for 5-1/2 years dollar-denominated bonds topped $2.9 billion.
In July, FAB issued the UAE’s inaugural dirham-denominated green sukuk, reflecting the increasing popularity of green issuances in the region. The Sharia-compliant instrument amounted to AED 1.3 billion ($353.93 million) and also served as FAB’s first public issuance denominated in dirhams.
The three-year green sukuk was successfully priced at 4.93 percent. This offering stands as the largest dirham sukuk ever issued and also marks the financial institution’s lowest pricing achieved in the dirham market to date, according to FAB.
The issuance showcases the potential of green and Islamic finance. It also aligns strongly with the UAE’s climate objectives. This is especially significant as the country prepares to host COP28 this year.
Read more: FAB explores a Standard Chartered takeover, doesn’t follow through
Q2 profit up 61 percent
Also in July, FAB said its second-quarter profit rose 61 percent from a year prior, as interest and non-interest income rose. The bank posted a net profit of 4.2 billion dirhams ($1.14 billion) in the quarter. That beat analysts’ average estimate of about 3.69 billion dirhams profit in the second quarter, according to Refinitiv data. Moreover, operating income in the second quarter was up 37 percent from a year earlier to 6.8 billion dirhams, the statement said. In addition, net impairment charges were at 676 million dirhams, down 15 percent from the first quarter.
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