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Mon 23 Jun 2014 02:15 PM

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Abu Dhabi's Al Hilal Bank plans $500m sukuk issue

Lender, owned by the Abu Dhabi Investment Council, sees demand hitting $1bn for Islamic bond

Abu Dhabi's Al Hilal Bank plans $500m sukuk issue
Al Hilal Bank CEO Mohamed Berro (Photo for illustrative purposes only)

Abu Dhabi's Al Hilal Bank plans to raise $500 million from a capital-boosting Islamic bond issue, a document from lead arrangers said on Monday.

The transaction, which has a perpetual tenor but can be bought back by the lender after the fifth year, is earmarked to price in the area of 6 percent. Order books for the trade are currently worth around $1 billion, the document added.

The sukuk will boost the bank's Tier 1 - or core - capital.

No timeframe for when the issue would complete was given in the update, but a market source told IFR - a Thomson Reuters unit - that it was expected to price on Tuesday.

The unlisted Islamic lender, owned by the Abu Dhabi Investment Council, has chosen itself as well as Citigroup , Emirates NBD, HSBC, National Bank of Abu Dhabi and Standard Chartered to arrange the deal.

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