- National Bank of Abu Dhabi plans a bond issuance, expected to be over $500m
- The bonds will be subordinated and unsecured, meaning a lower rating
It is undertaking a series of investor meetings in Europe and Asia from 8 June.
Benchmark bonds are typically more than $500m.
NBAD is the highest-rated bank in the Middle East, with its senior debt rated at AA-/A-1+ by US ratings agency Standard & Poors (S&P), Aa3/P1 by Moodys Investors Services, also of the US, and AA-/F1+ by Fitch Ratings, which is dual-headquartered in the US and UK.
NBAD is 70 per cent owned by the Abu Dhabi government.
However, the planned bonds will be subordinated, tier 1, unsecured debt. Moodys has assigned a provisional Baa3 hybrid rating, three notches lower than NBADs senior debt.
The bank will be able to suspend coupon payment and, in case of a default, senior debt will prioritised.
This will mean a higher yield for investors. NBADs last issuance of $750m in senior bonds, in February 2015, had a coupon rate of 2.25 per cent.
The planned bonds will be perpetual, but investors will be able to cash them from 2020.
The arrangers are NBAD itself, London-based HSBC, and Frances SG CIB and US-based Citi and Morgan Stanley.
NBAD had assets of $102bn at the end of 2014, and reported a profit of AED5.6bn ($1.5bn) for the year.