UAE’s first T-bond auction of 2023 gets bids worth Dh6.85b

The auction oversubscribed 6.2 times as investors repose trust in the Treasury Bonds programme

The first auction of the UAE T-Bond programme in 2023 witnessed a strong demand through the six primary bank dealers.

Muzaffar Rizvi

Published: Tue 31 Jan 2023, 7:32 PM

The UAE’s first auction of treasury bonds for 2023 received bids worth Dh6.85 billion, oversubscribing 6.2 times as investors repose trust in the Treasury Bonds programme.

The first auction of the UAE T-Bond programme in 2023 witnessed a strong demand through the six primary bank dealers. The strong demand was across both tranches with a final allocation of Dh550 million for the two-year tranche and Dh550 million for the five-year tranche, with a total of Dh1.1 billion for issuance in the first auction in 2023.

In 2022, MoF issued T-bonds aggregating to Dh9 billion across tenors of two years, three years, and five years.

“The success is reflected in the attractive market driven price, which was achieved by a spread of a 10bps for the two-year tranche, and a spread of 15bps over for the five-year tranche – both over the applicable US Treasury benchmark. This auction followed the practice of re-opening the T-Bonds which helps in building up the size of individual bond issues and improve liquidity in the secondary market,” according to a statement issued by the Ministry of Finance.

The T-Bonds programme contributes to building the UAE-dirham-denominated yield curve, strengthening the local debt capital market, developing the investment environment, providing safe investment alternatives for investors, as well as supporting sustainable economic growth.

— muzaffarrizvi@khaleejtimes.com