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21 February 2024

NBAD expects boost for sukuk mandates

NBAD expects to handle more international sukuk issuance for clients this year. (Supplied)

By Reuters

National Bank of Abu Dhabi  (NBAD) expects to handle more international sukuk issuance for clients this year amid overall growth in the sector, according to the bank's global head of debt Andy Cairns.

The UAE's largest lender by assets is one of the key players for issuance of Sharia-compliant financial instruments, or sukuk, to international markets.

"I expect us to do more business in 2015 than in 2014. We were book-runner on 13 international sukuk last year, raising $9.8 billion and representing 43 percent of total supply," NBAD's Andy Cairns said on the sidelines of an event in London, adding that he hopes for closer to 20 deals this year.

Looking at overall market volumes in international sukuk issuance, Cairns said he expected both volumes and numbers to grow, but with more corporates coming to market rather than sovereign issues by top-rated non-Muslim countries.

Cairns said he is optimistic that there will be more corporate sukuk from Asia, Europe and Sub-Saharan Africa.

The United Kingdom, Hong Kong, Luxembourg and South Africa all issued sukuk for the first time in 2014 in an effort to cement a foothold in the market and encourage corporate borrowers to follow suit, though none was expected to come back to the market this year.

"Last year we had 28 issuers in international Sukuk, and in 2015 I expect there to be more," Cairns said.