The bonds, which is comprised of medium and long-term tranches, captured the demand of international and regional investors. Global books peaked at over $22.5 billion, a statement said.
The announcement was made during a virtual media briefing where Younis Haji Al Khoori, Undersecretary of Ministry of Finance previewed the results of the subscription to the country’s sovereign bonds.
The 10-year tranche bonds were sold at $1 billion at a spread of 70bps over US Treasuries while the 20-year tranche bonds were sold at $1 billion at a spread of 105bps over US Treasuries. The $2 billion 40-year Formosa tranche is debt sold in Taiwan by foreign borrowers and denominated in currencies other than the Taiwanese dollar.
Al Khoori said: “The government bond tranches offered raised $4 billion, while global books peaked at $22.5 billion… The order book momentum increased the deal size to $4 billion from the initial target of $3 billion.”
He added: “The UAE issued these bonds to contribute to the development of the bond market and find investment alternatives for investors.”
The issuance come as the International Monetary Fund forecasts the UAE’s economy to grow by 3.1 percent in 2021, and the Central Bank of the UAE estimates a 4.2 percent growth in 2022.
The Ministry of Finance authorised Abu Dhabi Commercial Bank, BofA Securities, Citigroup Global Markets Limited, Emirates NBD Capital, First Abu Dhabi Bank, HSBC, JP Morgan Securities, Mashreqbank and Standard Chartered Bank to be lead managers and bookrunners to arrange subscription sessions with international investors.
Source:https://www.arabianbusiness.com/industries-banking-finance/469691-huge-investor-demand-seen-as-uae-closes-4bn-sovereign-bond