Dubai Duty Free, which operates retail space at Dubai International airport, is set to close a $1.5bn loan by early July, according to sources close to the deal.

The loan is in the final stages and could reach financial earlier. The loan is priced at 3.5 percentage points above the London interbank offered rate and has a tenor of five years.

“This was launched at $1.1bn, then increased in size to $1.5bn, and the banks still had significant scale backs,” says one banker involved in the deal. That Dubai Duty Free managed to attract more offers than it needed is the latest sign that bank sentiment towards the emirate is improving.

A group of about 15 banks are understood to have financed the loan, including just three international lenders; the UK’s HSBC, the US’ Citigroup, and Austria’s Bawag. The rest of the lenders are all regional banks. The low level of participation by international banks is a sign that they are increasingly unable to compete with regional banks on pricing.

The Dubai Duty Free deal is being arranged by the local Emirates NBD, Dubai Islamic Bank, Abu Dhabi Islamic Bank, HSBC and Citigroup.

The cash raised by the deal will be used to finance expansion of the firm’s retail space.