The first international syndication by Gulf International Bank (GIB), which aimed to raise $200 million for the Bahrain-based bank, was well oversubscribed and has closed at $300 million, the arranger says. The signing will take place on 20 November in Manama (MEED 29:9:95).
Commerzbank, the sole arranger, says there was a strong response from a broad range of institutions, including a strong Arab representation. This encouraged GIB to increase the allocation to subscribers. The loan is for five years, and is priced at 42.5 basis points above the London interbank offered rate (Libor).
The co-arrangers were Bank of Tokyo, Bayerische Landesbank, Citibank, Fuji Bank, Morgan Guaranty, National Bank of Kuwait and Societe Generale. Among the lead managers were Arab Banking Corporation and The Gulf Bank. Other Arab banks involved in the syndication were National Bank of Bahrain, National Bank of Abu Dhabi, National Bank of Egypt, National Bank of Ras al-Khaimah and Misr Bank Europe.
In an October interview with MEED, Mohannad Farouky, GIB assistant general manager, said the bank was placing a greater emphasis on lengthening the maturity of its liabilities. He said customers in the Middle East prefer to keep their funds on a short-term basis of between six months to one year, so the five-year loan will help balance the maturity of the bank’s liabilities with its assets profile.