Key Takeaways
- • Emirates NBD mandated a syndicate of six joint lead managers (ADCB, BofA Securities, Citi, Emirates NBD Capital, FAB, and Standard Chartered) to arrange a US dollar Additional Tier 1 (AT1) perpetual non-call six-year benchmark bond issuance.
- • The bank successfully raised $750 million via the AT1 bond at a final coupon of 4.25%, representing a 25 basis point tightening from initial guidance of approximately 4.50%, indicating strong investor demand with over $1.6 billion in orders received.
- • Emirates NBD, rated A2 positive by Moody's and A+ stable by Fitch, structured the issuance as a Reg S perpetual non-call six-year (PerpNC6) resettable fixed-rate capital instrument, following regulatory capital strengthening requirements.
- • The issuance proceeded despite recent market headwinds, as Bahrain's Bank ABC withdrew a planned $400 million AT1 offering citing challenging market conditions, underscoring Emirates NBD's competitive positioning in Gulf capital markets.
Summary
Emirates NBD, the UAE's second-largest lender, successfully executed a $750 million Additional Tier 1 bond issuance at a coupon of 4.25%, demonstrating strong investor appetite for Gulf banking sector capital instruments. The bank mandated a six-dealer syndicate comprising ADCB, BofA Securities, Citi, Emirates NBD Capital, FAB, and Standard Chartered as joint lead managers and bookrunners. Fixed income investor meetings and calls commenced on Thursday, with in-person roadshow meetings held in Dubai on Friday and London on Monday.
The bond was structured as a US dollar-denominated Reg S perpetual non-call six-year (PerpNC6) resettable fixed-rate AT1 capital instrument. Final price guidance was tightened to between 4.25% and 4.375% from initial guidance of approximately 4.50%, reflecting demand conditions and Emirates NBD's market positioning. The bank received over $1.6 billion in total orders, enabling the pricing tightening of 25 basis points and confirmation of the $750 million deal size at the lower end of the guidance range.
Emirates NBD's credit ratings of A2 positive from Moody's and A+ stable from Fitch provided confidence to investors. The timing of the issuance followed what market sources referenced as a "DIB record breaker," indicating strong momentum in regional Islamic and conventional capital markets. The successful execution is notable given recent AT1 market volatility, as Bahrain's Bank ABC withdrew a planned $400 million AT1 issuance the previous month citing market conditions. Emirates NBD's ability to execute at favorable pricing demonstrates institutional confidence in the UAE banking sector and the bank's capital management strategy during a period of selective market access for Gulf regional issuers.
The bond was structured as a US dollar-denominated Reg S perpetual non-call six-year (PerpNC6) resettable fixed-rate AT1 capital instrument. Final price guidance was tightened to between 4.25% and 4.375% from initial guidance of approximately 4.50%, reflecting demand conditions and Emirates NBD's market positioning. The bank received over $1.6 billion in total orders, enabling the pricing tightening of 25 basis points and confirmation of the $750 million deal size at the lower end of the guidance range.
Emirates NBD's credit ratings of A2 positive from Moody's and A+ stable from Fitch provided confidence to investors. The timing of the issuance followed what market sources referenced as a "DIB record breaker," indicating strong momentum in regional Islamic and conventional capital markets. The successful execution is notable given recent AT1 market volatility, as Bahrain's Bank ABC withdrew a planned $400 million AT1 issuance the previous month citing market conditions. Emirates NBD's ability to execute at favorable pricing demonstrates institutional confidence in the UAE banking sector and the bank's capital management strategy during a period of selective market access for Gulf regional issuers.
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