Dubai Islamic Bank completes $750 million Sukuk issue

DUBAI: Dubai Islamic Bank (DIB) successfully closed a USD 750 million 5-year Sukuk with a profit rate of 2.950% per annum, which is equivalent to 140bps over the 5-year Mid Swap Rate. Dubai Islamic Bank (DIB) is rated A3 by Moody’s and A by Fitch (both stable).

The transaction is DIB’s second foray into the international capital markets in 2019, the first being a USD 750mn Additional Tier 1 Sukuk priced earlier this year. The Sukuk’s profit rate of 2.95% is the tightest achieved by an FI Sukuk in 2019.

The deal was priced intraday after completing a global roadshow in Hong Kong and London, as well as several investor calls. The meetings were used to demonstrate management’s ability to deliver on its strategy and showcase the strong credit fundamentals of the bank.

The roadshow resulted in significant demand from Middle astern, Asian and European investors, with an orde rbook that closed in excess of USD 2bn, representing an oversubscription rate of 2.7 times.

Dr. Adnan Chilwan, the Group Chief Executive Officer of the bank, commented “The success of DIB’s Sukuk is a testament to the confidence investors place in the bank’s robust fundamentals, as well as their comfort in the broader Dubai and UAE story. We are extremely pleased with the outcome of this transaction and remain committed to our local and global investors who continue to support our diversified funding strategy”.

The Sukuk was issued as a drawdown under DIB’s USD 7.5 billion Trust Certificate Issuance Programme which is listed on Euronext Dublin and NASDAQ Dubai.

Bank ABC, Dubai Islamic Bank, Emirates NBD Capital, First Abu Dhabi Bank, HSBC, Maybank, Sharjah Islamic Bank, Standard Chartered Bank and Warba Bank acted as Joint Lead Managers and Bookrunners on this transaction. The Islamic Corporation for the Development of the Private Sector acted as a Joint Lead Manager (no books) and Kuwait International Bank acted as a Co-manager.

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