First Gulf Bank bond issue receives more than $1bn of orders

17 November 2009

Demand strong for Abu Dhabi bank bond

Abu Dhabi’s First Gulf Bank has received more than $1bn of orders for a prospective bond issue, the size of which could now be increased as the bank had initially been targeting a bond of around $500m.

Pricing on the deal has been set at between 250 and 275 basis points above the midswap rate, the mid-point between bids and offers on interest rate contracts. The bond will have a tenor of three years and will be US dollar denominated.

The bond issue is expected to be completed by either the end of 19 November, or on 20 November. The bank says the bond will be used to fund its general operations.

“Investors like the Abu Dhabi story and see a lot of state support for the emirate’s banks, which has helped boost sentiment for this issue,” says the banker.

First Gulf has appointed France’s BNP Paribas, the UK’s HSBC, Deutsche Bank and the US’ Citigroup to act as arrangers on the deal. The bank started a roadshow for international investors on 12 November (MEED 13:11:09).

The deal is the latest from a growing line of GCC-based issuers and is expected to be followed by the UAE’s Emirates NBD before the end of the year. On 17 November Qatar sold $7bn of sovereign bonds after receiving orders of $27bn.

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