By Courtney Trenwith
Dubai bank had been rumoured to be seeking finance to reduce government support for its capital ratios
Emirates NBD, Dubai's largest lender, listed a US$750m conventional bond on the NASDAQ Dubai bourse on Sunday.
The bank had been rumoured to be seeking finance to reduce government support for its capital ratios.
Reuters reported earlier this month that the lender had hired six banks - HSBC Holdings, National Bank of Abu Dhabi, Citigroup Inc, JP Morgan Chase, Societe Generale and itself – to help arrange a benchmark-sized subordinated bond sale of at least US$500m.
The bank, which is 55.6-percent owned by state fund Investment Corp of Dubai, received AED12.6bn (US$3.43bn) from the government in 2008. It said in January that it was looking to begin repayment of the funds.
The issue on Sunday was three-and-a-half times oversubscribed with more than 160 orders received from regional and international investors, according to NASDAQ Dubai.
About 47 percent of the bond was allocated to MENA-based investors, while 28 percent went to investors in Asia and 25 percent was allocated to European investors.
The listing brought the nominal value of conventional bonds and sukuk (Islamic bonds) on Dubai exchanges to US$19.7bn.
“As the latest in a series of debt issuances and listings in Dubai this year, Emirates NBD’s bond is further evidence that the sector is successfully meeting the capital-raising needs of regional businesses in an expanding economy,” NASDAQ Dubai chairman Abdul Wahed Al Fahim said in a statement.
“Dubai’s capital markets will continue to gain critical mass in both the conventional and Islamic sectors, maintaining their focus on providing excellence for investors through a wide range of financing options.”
Earlier this year both Dubai-based Emirates Airline and DEWA, Dubai's state-owned utility, each listed a US$1bn sukuk.