UAE’s first Islamic private placement Sukuk raises Dh826m

Abu Dhabi government-owned Al Hilal Bank has acquired a Private Placement funding worth $225 million (Dh826m) under its existing Trust Certificate Issuance Program of $2.5 billion, the bank said in a media statement today.

This is the second tranche under the program. The first funding secured was worth $500m for five years, and was issued in 2013.

Al Hilal Bank is the only full-fledged Islamic Bank that is wholly owned by the Government of Abu Dhabi through Abu Dhabi Investment Council.

It priced a 2.5-year (January 2019) $225MM RegS floating rate note Sukuk at 3mL+160bps under its  $2.5 billion existing Trust Certificate Issuance Program on May 31.  

This swiftly executed trade comprising a few pre-identified investors, marks the first Islamic Private Placement Sukuk issued by a UAE financial institution, the bank said in the statement.

This development also marks the return to senior unsecured dollar Sukuk market since 2013 by any entities out of Abu Dhabi, it added.

“We are very pleased to announce this first Islamic private placement in the UAE. Al Hilal Bank’s strategy is to diversify its funding base and tenors. We aim to work towards raising funding for medium term to enhance our funding profile and meet balance sheet growth targets,” said Khaled Abdulla Alkhoori, CEO, Al Hilal Bank.