The UAE lost to Sri Lanka by 15 runs in the Global Qualifier semifinal
The UAE is expected to raise between $3 billion and $3.5 billion from its debut bond sale.
The first bond sale by the federal government in UAE’s 50-year history will comprise three tranches denominated in dollars, according to sources close to the deal.
It is learned that the UAE would start marketing its inaugural bonds this week.
On Monday, documents from banks leading the deal showed the finance ministry was planning a debut sale of senior unsecured bonds with maturities of 10, 20, and 40 years, subject to market conditions.
The UAE cabinet in January approved a public debt strategy aimed at developing the domestic market for local currency bonds and officials have said last year an issuance was imminent. In 2018, a Public Debt Law allowing the issuance of federal bonds was passed.
The goal of the strategy is to build a market for federal government debt securities denominated in UAE dirhams, and to “revitalise the financial and banking sector in the country.”
Rating agency Moody’s has said since the primary purpose of the bonds is to establish a domestic yield curve, the higher debt burden will be accompanied by further accumulation of liquid assets, and is unlikely to significantly affect the fiscal strength of the federal government.
While the federal government has never issued bonds before, several of the seven emirates have, most notably Abu Dhabi and Dubai.
The 40-year portion of the federal government bond will be Formosa bonds, which are debt securities sold in Taiwan by foreign borrowers and denominated in currencies other than the Taiwanese dollar.
The proceeds will be used for “domestic budgetary purposes in compliance with the Public Debt Strategy”, an offering circular seen by Reuters showed.
These include financing cabinet-approved infrastructure projects up to a maximum of 15 per cent of the UAE’s direct and indirect outstanding public debt that is not denominated in dirhams.
The funds will also be used to back investments by the Emirates Investment Authority, the UAE’s only federal sovereign wealth fund.
The finance ministry hired a group of banks to lead the deal comprising Abu Dhabi Commercial Bank, BofA Securities, Citi, Emirates NBD Capital, First Abu Dhabi Bank, HSBC, JPMorgan, Mashreqbank and Standard Chartered.
These banks started to hold investor calls from Monday.
The federal budget accounts for only a fraction of consolidated state spending in the UAE and is partly funded by grants from Abu Dhabi and Dubai, which have their own budgets.
— issacjohn@khaleejtimes.com
The UAE lost to Sri Lanka by 15 runs in the Global Qualifier semifinal
Narine's 81 off 39 balls guided Kolkata to 235-6 after they were invited to bat first in Lucknow's final home game
UAE government has been actively promoting digital transformation initiatives
Investment expert advocates long-term approach to build your portfolio
Needing a win at Anfield to close the gap on fourth-placed Villa, Tottenham slumped to a fourth successive loss
Israeli strike on Lebanon's Mais Al Jabal kills four people from a single family
Shortly after the attack, an Israeli airstrike hit a house in Rafah killing three people and wounding several
In a private address, the Republican presidential candidate attacks prosecutors involved in his criminal indictments