RIYADH May 4 Abu Dhabi Commercial Bank
(ADCB), the United Arab Emirate's second largest bank
by assets, plans to issue a senior unsecured dollar bond,
banking sources familiar with the matter said on Thursday.
The transaction is expected to be of benchmark size, which
usually means at least $500 million.
At least four banks have been appointed to arrange the deal,
one of the sources said.
ADCB declined to comment when contacted by Reuters.
This latest bond issue joins a significant pipeline of debt
sales by banks in the Gulf, with both Saudi Arabia’s Saudi
British Bank and Kuwait’s National Bank of Kuwait
planning to raise funds internationally, as reported by Reuters.
Sovereigns, banks and corporates in the Gulf Cooperation
Council have relied increasingly on the international debt
markets to replenish their coffers hit by the drop in oil prices
in late 2014.
“We expect more debt issuance from financial institutions
from both Saudi and other GCC countries,” said Bashar Al Natoor,
global head of Islamic finance at Fitch Ratings, speaking to
Reuters on the sidelines of a Euromoney conference in Saudi
Arabia this week.
“Liquidity is better than in early 2016 but banks still have
some issues such as Basel III requirements and non-performing
loan ratios, so they might still need financing.”
ADCB is a regular issuer in the international markets and
has raised almost $1 billion this year through two Formosa bonds
of $750 and $230 million. Formosa bonds are sold in Taiwan by
foreign issuers and are denominated in currencies other than the
(Editing by Jane Merriman)