The UAE will be issuing Dh50 million ($13.6 million) in its inaugural sovereign retail treasury sukuk programme, which is open to all residents and is aimed at encouraging financial responsibility.
The minimum investment in the government-backed, Sharia-compliant scheme is Dh1,000, with an annual profit rate of 4.3 per cent over a two-year term, the Ministry of Finance said on Tuesday.
The subscription period will run from June 24 to 30. The bonds are expected to be listed on Nasdaq Dubai and become available for trading on July 2, after the offering process is completed, the ministry said.
The programme builds on government efforts to encourage investment from Emiratis and foreign residents. Previously, only institutional investors were allowed to invest in government bonds.
This is distinct from the fractional T-sukuk and bonds initiative launched in November, in terms of the investment procedure and the source of the securities. The previous programme allowed investors to purchase fractional interests in existing sukuk traded at prevailing market prices, with a minimum investment of Dh4,000.
The new retail T-sukuk provide investors with direct access to newly issued sovereign bonds through a primary market subscription at par value, or 100 per cent.
Investors can buy shares online through the Dubai Financial Market’s subscription platform and its app iVestor, as well as Emirates Islamic Bank, Abu Dhabi Islamic Bank, Ajman Bank, Mashreq and Emirates NBD, the programme's lead receiving bank.
The offering is a “milestone in bolstering the readiness of the UAE's sovereign investment ecosystem by providing structured, fully digital subscription channels”, said Mohamed Al Hussaini, Minister of State for Financial Affairs.
It will “enable individual investors to access government investment products efficiently and transparently through approved platforms”, he added.
“Enabling subscriptions through approved digital platforms and designated banking channels simplifies participation for individual investors and provides a clear pathway to access sovereign sukuk offered within a transparent investment framework.”
The sovereign retail T-sukuk programme forms part of the ministry's broader efforts to expand participation in government-backed investment instruments that are accessible to a wider segment of the UAE population.
It supports greater public participation in the country's financial and investment ecosystem while promoting a culture of long-term saving and investment, the ministry said.
The scheme also enables investors to diversify their portfolios through a trusted, government-backed instrument within a structured framework that extends from subscription through listing and secondary-market trading.
The offering was announced after a meeting of the Investment Affairs Council on Monday, led by Sheikh Tahnoon bin Zayed, Deputy Ruler of Abu Dhabi and National Security Adviser. During the gathering, the council, which operates under the Supreme Council for Financial and Economic Affairs, reviewed the first-quarter performance of the emirate's largest sovereign funds.
The council also discussed global economic developments and the investment plans of relevant entities across the Emirates.
