Exceptional Results on UAE's treasury

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I wanted to share this amazing news that I found today as UAE Ministry of Finance has successfully closed its offering of a U.S. dollar-denominated dual-tranche sovereign bond package, which is comprised of medium and long-term tranches: a 10-year tranche and a 30-year Formosa tranche — with a total value of USD 3 billion, which saw orders in excess of USD 15 billion and the size doubled from initial target of USD 1.5 billion

His Excellency Mohamed Bin Hadi Al Hussaini, Minister of State for Financial Affairs pointed out that the successful subscription of the second sovereign bonds is a testament to the confidence of investors in the strong credit and stability of the UAE economy. 

H.E. Al Hussaini said: “The initial target was a benchmark size of USD 1.5 billion, with global book orders peaking at c. USD 15 billion on an intraday transaction, representing a c. 5x oversubscription; the issuance was upsized to USD 3 billion. Pricing was tightened by 25bps from the initial pricing guidance on both tranches, with final pricing at UST plus 100 bps for the 10-year tenor and UST plus 175 bps for 30-year tenor.
“The New Issue Concession priced into the deal was at the lower end than what the market has generally seen in this elevated volatility, and this is a recognition of the strong credit and the strong leading position the UAE enjoys. This reiterates the country’s creditworthiness and the desire of international investors to take advantage of the multiple safe investment opportunities offered by the robust investment climate of the country.”

H.E Al Hussaini added: “The sovereign bonds contribute to increasing the competitiveness of the UAE across various fields and support the country’s financial and economic policies aimed at achieving inclusive and sustainable development. This is by diversifying sources of income, attracting foreign investments, and building a multi-opportunity investment environment. The Ministry of Finance will continue bolstering the UAE’s financial system and offering innovative financial tools that advance national economic development.”

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