Global Arab Network | Ras Al Khaimah completes 0m Sukuk issue under its bn Programme

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Ras Al Khaimah completes $400m Sukuk issue under its $2bn Programme

Global Arab Network - - George Haddad

Thursday, 23 July 2009 20:02

Ras_Al_Khaimah_Government_completes_400m_Sukuk_issue_under_its_2bn_Sukuk_Programme

The Ras Al Khaimah Government today completed the formal documentation signing for its landmark $400m Sukuk issue, with Standard Chartered Bank, BNP Paribas and Liquidity House acting as joint bookrunners.

This issuance is both the first US dollar Sukuk issued by a Sovereign under a programme and by an emirate in the UAE.

This is the second issuance under the Government's $2bn Sukuk Programme. The first issuance was an Dhs1bn Sukuk issue in May 2008 in which Standard Chartered Bank acted as sole arranger and sole bookrunner.

At the signing Ceremony, Sheikh Saud Bin Saqr Al Qasimi, Crown Prince and Deputy Ruler of Ras Al-Khaimah said: 'We are extremely pleased with the strong investor response to the Sukuk issue which serves as an indication of the Ras Al Khaimah Government's continued credibility with the international investor community. I would like to thank both Standard Chartered Bank and BNP Paribas for the integral role they played towards the success of this well-distributed issue which will establish a liquid benchmark for the Government in the US dollar markets.'

The timing of the Government's second foray into the international capital markets was critical. It took place against the back-drop of positive investor sentiments towards high-grade government issuers and a scarcity of US dollar Sukuk paper in the international capital markets.

Shayne Nelson, Regional Chief Executive, Standard Chartered MENA commented: 'The Government of Ras Al Khaimah has a strong strategic vision and plan for their esteemed Emirate and the success of this Sukuk issuance reaffirms the Government's leadership, commitment and capabilities. The Sukuk is a key milestone not only in the continued development of Ras Al Khaimah but also in the evolution of Islamic Banking.

The roadshow began on 6 July in the Middle East and ended on 10 July in Europe. The Government's credit story was effectively communicated in all key financial centres in the Reg S markets, and the successful marketing efforts generated broad international investor understanding of the Government's credit story and its strategic importance to the UAE.

Based on the strong investor response received during the roadshows, the Government announced its intentions for a second issuance under its Sukuk Programme, releasing a price whisper in the 8.00% to 8.50% area for a 5-year issuance on 14 July. This was followed by the release of official price guidance of 8.00% - 8.25% for a target issue size of $300m - $500m on 14 July.

The order book grew rapidly to over $1.65bn with over 120 investors, despite being open for only 24 hours in the Middle East and Asia and only six hours in Europe. The transaction received strong interest from investors across the Reg S markets, with final allocations of Middle East 47%, Asia 34% and Europe 19%.

Global Arab Network

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