Dubai DIB closes the lowest-ever yielding additional tier-1 sukuk

Dubai Islamic Bank closes the lowest-ever yielding additional tier-1 sukuk. Mona Al Marzooqi / The National

Dubai Islamic Bank, the largest Sharia-compliant lender in the UAE by assets, priced its $1 billion additional tier-1 sukuk at a profit rate of 4.625 per cent per annum.

The deal for the perpetual non-call sukuk, with a five-and-a-half year tenor, carries the lowest-ever yield achieved by any bank globally on an tier-1 Sharia-compliant bonds, DIB said in a statement on Saturday.

“Despite the turmoil witnessed in markets this year during the peak of the Covid-19 crisis, DIB's success ... is a testament to the bank’s strong credit profile and standing with international and regional investors,” the lender said. “It reaffirms the confidence of international investors not only in DIB but [also] in Dubai and the UAE.”

The deal was priced intraday after completing a global investor call, which was attended by several local, regional and international investors, the bank said.

The sukuk is listed on Euronext Dublin and Nasdaq Dubai.

Dubai Islamic Bank, Emirates NBD Capital, First Abu Dhabi Bank, HSBC, Sharjah Islamic Bank and Standard Chartered Bank acted as joint lead managers and bookrunners on this deal.

Earlier this month, Dubai Islamic Bank completed the integration of Noor Bank ahead of schedule, creating the UAE's biggest Islamic lender with assets of more than Dh300bn.