The UAE markets the first issue of its federal bonds


Bloomberg News Agency reported that the UAE is currently marketing the first federal bonds in its 50-year history, to help finance infrastructure projects and investments by the sovereign wealth fund..

And “Bloomberg” news agency quoted an informed source, who requested anonymity, that the securities mature within ten to 20 years..

The country also offers 40-year dual-listed Formosa bonds, which are bonds issued in Taiwan and denominated in a currency other than the Taiwan dollar..

Abu Dhabi Commercial Bank, Bank of America Securities, Citigroup, Emirates NBD Capital, First Abu Dhabi Bank, HSBC, JPMorgan, Mashreq Bank and Standard Chartered were appointed to manage the sale..

Two informed sources said today, Monday, that the UAE federal government is expected to raise between three billion and 3.5 billion dollars from the first sale of bonds, which will consist of three tranches denominated in US dollars..

While the UAE government has never issued bonds before, some of its seven emirates have taken this step, including the capital, Abu Dhabi, and the financial center, Dubai..

Sources told Reuters on Sunday that the UAE will start marketing its first bond this week.

Today, documents issued by banks leading the process, and seen by Reuters, showed that the Ministry of Finance is planning the first sale of unsecured first-class bonds, for periods of 10, 20 and 40 years, depending on market conditions..

The 40-year tranche will be Formosa bonds, which are bonds sold in Taiwan by foreign borrowers, denominated in currencies other than the Taiwan dollar..

A circular for the offering, seen by Reuters, showed that the proceeds will be used for domestic budgetary purposes, in line with the public debt strategy..

This includes financing infrastructure projects, approved by the Cabinet, with a maximum of 15 percent of the existing direct and indirect UAE public debt, not denominated in dirhams..

The money will also be used to support investments by the Emirates Investment Authority, the country’s only federal sovereign wealth fund.

These banks will contact investors, starting today.



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