First Abu Dhabi Bank issues 1.4bn Chinese yuan formosa bond

The bond is the largest in Chinese yuan from the Mena region


First Abu Dhabi Bank in Um Suqeim

(Photo by Reem Mohammed/The National)

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First Abu Dhabi Bank, the UAE’s largest lender by assets, issued a dual-listed, 1.4 billion Chinese yuan (Dh726.4 million) five-year formosa bond.

The bond is the largest denominated in Chinese yuan from the Mena region, FAB said on Tuesday.

Formosa bonds are issued in Taiwan by foreign borrowers but are denominated in currencies other than the Taiwanese dollar.

The Abu Dhabi-based lender said its bond attracted an order book of 1.6bn yuan, enabling it to upsize the issuance to 1.4bn yuan from 1bn yuan.

“This deal is further testament to FAB’s ability to access niche markets at short notice and to take advantage of opportunistic funding levels,” said Rula AlQadi, head of group funding, FAB. “The CNH deal swaps back well inside our USD curve for a decent size of the equivalent of almost $200m(Dh734m).”

FAB earned maximum demand from onshore Taiwan as well as from the rest of Asia due to the dual listing, the lender said.

"FAB has been a regular issuer in the formosa market which enabled the bank to print the largest deal from the region in this currency," the bank said.

FAB was the structuring agent on the deal, which was issued under the bank’s $15bn (Dh55bn) Euro Medium Term Note programme, the bank said.

Gulf lenders, including FAB, have been actively tapping the bond markets this year.

In February, FAB said it raised Dh3bn in two separate bond issuances over three days.

The lender issued a three-year, £450m (Dh2.15bn) bond, which was the first and largest issuance in sterling from a financial institution in the Middle East, as well as a A$350m (Dh860m) five-year Kangaroo bond, its first in Australia since 2014.

The bank also issued a $500m sukuk earlier this year, for which the order book topped $1bn.

FAB was formed in 2017 through the merger of National Bank of Abu Dhabi and First Gulf Bank.