The United Arab Emirates Ministry of Finance (MoF) has reported strong demand for its first seven-year Islamic Treasury Sukuk (T-Sukuk), issued in February.
Demand for the AED 550 million (US$149.8 million) tranche was six times its size, reaching approximately AED 3.1 billion. This reflects confidence in the national economy and the Islamic finance sector, the MoF stated.
Issued in partnership with the Central Bank of the UAE (CBUAE) as issuing and payment agent, this is the longest tenor bond that has been issued under the MoF’s programme to date and reflects its intentions to extend and deepen the UAE dirham yield curve, it said. The bond has a 3.779% yield to maturity (YTM).
The remainder of the AED 1.1 billion (US$229.5 million) auctioned in AED-denominated T-Sukuk in February matures in May 2030, and has a 3.53% YTM.
Bids of AED 5.88 billion (US$1.6 billion) from eight primary dealers signify a 5.3-times oversubscription ratio for February’s auction.
The sukuk are listed under the UAE’s Islamic Treasury Sukuk Program with Nasdaq Dubai.
“[The programme] reinforces the local debt capital market, contributes to the development of the broader investment landscape, and supports the UAE’s long-term economic sustainability and growth objectives,” the MoF affirmed.
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