Dubai, UAE — Abu Dhabi Islamic Bank (ADIB) has raised $750 million in the world’s first dollar denominated additional tier-one (AT1) perpetual sukuk issued since March 2023.
ADIB, which is rated A2 by Moody’s and A+ by Fitch, in each case with a stable outlook, priced the perpetual non-call, five and half-year sukuk at a profit rate of 7.25 percent per annum payable semi-annually. The new sukuk will be listed and traded on London Stock Exchange.
The issuance was met with exceptional demand, attracting interest from over 240 global and regional investors with the final order exceeding $7 billion more than nine times over-subscribed and final pricing 62.5 bps tighter than the initial pricing thoughts. Additionally, reset spread is 306 bps over US treasury yields, which is 121 bps lower than the previous AT1 sukuk issued by ADIB in 2018.
“We are pleased to see this strong international demand continue as the final pricing tightened. The sukuk issuance will maintain the Group’s optimized capital structure and its strong CET1 position,” said Nasser Al Awadhi, ADIB Group Chief Executive Officer.
The issuance was driven by broad demand across three regions, with final allocations of 83 percent to MENA, 13 percent to Europe 4 percent to Asia, by investor type, private banks 70 percent, Asset and Fund managers 16 percent, commercial banks 10 percent and others 4 percent.
The sukuk issuance will maintain the Group’s optimized capital structure and its strong CET1 position. ADIB’s tier-one perpetual sukuk was structured to comply with the internationally agreed Basel III regulatory framework, which includes detailed criteria for capital and liquidity.