Mubadala to develop GCC project bond market

27 January 2009
Mubadala Development Company, the Abu Dhabi investment firm, is hoping to develop a project bond market to offset the decline in the availability of project finance from banks, according to project and corporate finance director Derek Rozycki.

Rozycki told MEED’s Middle East Project Finance 2009 conference in Bahrain on 26 January that the rising cost of borrowing and the reduced tenor of project finance deals made project finance bonds more attractive.

“Mubadala itself has aspirations in the debt capital market,” he said. “We are also quite excited about the ground swell of interest among bankers and fixed income investors in a project bond. This is a very opportune time with the banks retrenching and we really need that bond market to prosper.

Rozycki said that total GCC bank lending would rise to about $70bn in 2009 from about $67bn in 2009. But a high proportion of credits this year will be used in refinancings rather for fresh loans, he added.

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