Dubai Bank plans Sukuk issuance to fund growth

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•  Dubai Bank establishes its US$ 5 billion Sukuk Programme

 
Dubai Bank, a Dubai Group company, has established its medium-term notes (MTN) program to issue Shari’a-compliant bonds, more commonly known as Sukuk. The US$5 billion Sukuk is part of Dubai Bank’s strategy to put in place a more efficient capital structure through broadening and diversifying its funding streams for its continued growth and expansion activities. 
 
Dubai Bank CEO, Salaam Al Shaksy, explained that this programme is part of Dubai Bank’s strategy for growth and expansion, which has been bolstered by the unification of Dubai Bank and Dubai Islamic Investment Group under the umbrella of the Dubai Banking Group, part of the Dubai Group, last May.
 
“This is a historic milestone for Dubai Bank, as we prepare to fund an aggressive plan for growth and expansion in retail and corporate Shari’a-compliant banking services across the region and beyond,” said Mr. Al Shaksy. “Sukuk issuance will support funding this strategy and position us regionally as a leader in Shari’a-compliant banking, placing us amongst leading financial institutions. It gives us pride to represent the Emirate of Dubai in the banking and financial services arena, and to execute the vision of His Highness Sheikh Mohammed Bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE, Ruler of Dubai.”
 
Dubai Bank’s CFO, Ahmed Elshall, highlighted that Dubai Bank has appointed UBS and Standard Chartered as arrangers for the programme, which will be listed on both the London Stock Exchange (LSE) and the Dubai International Financial Exchange (DIFX).
 
“International ratings agencies Fitch Ratings and Moody’s Investors Service have rated Dubai Bank’s Sukuk issuance programme at long-term ‘A’ and A3/Prime-2 respectively,” Mr. Elshall added.
 
Shortly after its conversion to a Shari’a-compliant financial institution in January 2007, Dubai Bank launched its accelerated growth strategy. Since that time, the bank has witnessed exponential growth, with the number of fully-operating, strategically-located branches increasing from only five in 2006 to the current total of 20, situated throughout the UAE.
 
Most recently, Dubai Bank was assigned a long-term rating of A3 with a positive outlook from Moody’s Investors Service.

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