Photo: A branch of Dubai Islamic Bank in Ras Al Khaimah, UAE on October 16, 2019. Jeff Kingma /

Islamic Finance

Dubai Islamic Bank sells $1 bln sukuk

The UAE’s largest Islamic bank has sold a $1 billion long 5-year sukuk.

Dubai Islamic Bank said in a statement on Wednesday (June 10) the sukuk carries a profit rate of 2.95%, equivalent to 245 bps over the equivalent tenor mid-swap rate.

DIB said the sukuk attracted more than 170 investors, with the order book reaching over $4.5 billion. Nearly 50% came from outside the Middle East and North Africa region, according to the bank.

DIB CEO Adnan Chilwan said the 4.5 times oversubscription is “a clear testament to the confidence” the global markets place in the bank, as well as investor “comfort” in the broader Dubai and UAE economy.

The sukuk was issued as a drawdown under DIB’s $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, ICBC, The Islamic Corporation for the Development of the Private Sector, KFH Capital, Sharjah Islamic Bank and Standard Chartered Bank acted as Joint Lead Managers and Bookrunners on this transaction.

DIB posted 1.11 billion dirhams ($302 million) in net profit for the first-quarter of this year, down 18.31% year-on-year, as additional provisions and buffers reached 1.5 billion dirhams to cover the impact from the COVID-19 pandemic, oil price volatility and low interest rate environment.

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