Emirates NBD in $1bn bond swap

Bank Emirates NBD will exchange $1bn medium term bonds for shorter term bonds in an effort to boost its regulatory capital ratios, the bank said on Thursday.

The bank will exchange bonds issued in 2006 that mature in 2016 and which are trading below face value for shorter term bonds that mature in 2012 in a move to strengthen its balance sheet.

"From this transaction, we can improve our Tier 1 Capital position while investors are in higher value security," said chief executive Rick Pudner in a statement.

Chief financial Officer Sanjay Uppal was quoted last month as saying the bank's Tier 1 capital adequacy ratio stood at 9.4 percent and that the bank must raise AED3bn ($816,750) next year in order to meet 2010 targets.

Banks in the UAE have sought to strengthen their capital adequacy ratios following new rules issued by the country's central bank in the face of an economic downturn. (Reuters)

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