Sales of dirham-denominated Treasury bonds are on the horizon for the UAE as it looks to strengthen its local banking and financial sectors.
In the UAE, the federation issued its first-ever dollar bond last year. The country also received its initial credit rating from Fitch Ratings in 2020, which placed it in the fourth-highest investment grade, Bloomberg reported.
The bond programme “will enable market participants in the UAE to maintain a transparent, single, diversified, and sustainable pool of dirham liquidity,” Khaled Mohamed Balama, the governor of the UAE Central Bank, said in a statement Wednesday.
The issuance is “the next step forward in the development of the local capital market,” he added.
The dirham securities worth $408 million (AED 1.5 billion) will be issued initially in two, three, and five-year tenures, followed by a 10-year bond at a later date. A date for the first auction will be announced soon, the bank said.
The UAE Ministry of Finance has assembled six local and international banks to participate in the primary market auction, including Abu Dhabi Commercial Bank PJSC, Emirates NBD PJSC, First Abu Dhabi Bank PJSC and Standard Chartered Plc, Bloomberg reported.Source: