The government of Sharjah aims to raise approximately AED1bn ($272mn) through an auction of five-year Islamic bonds, or sukuk, according to a banking document seen by Reuters on Wednesday.
The outcome of this sukuk issuance could provide insights into investor appetite for Gulf debt and Sharjah's creditworthiness in particular, often being one of the weaker performers in the confederation.
The Central Finance Department of the emirate has set the maximum profit rate for the debt instruments at 6%, according to the document issued by one of the arranging banks.
The final yield and issuance size are expected to be announced later today.
On Tuesday, the Sharjah government appointed a consortium of banks to manage the auction. These include Abu Dhabi Commercial Bank, Abu Dhabi Islamic Bank, Bank of Sharjah, Dubai Islamic Bank, Emirates NBD Capital, First Abu Dhabi Bank, HSBC, Invest Bank, Mashreq and Sharjah Islamic Bank.
This move comes as Gulf governments increasingly turn to debt markets to bolster their finances amidst economic challenges and fluctuating oil prices.
Related Articles
ADNOC Drilling wins contract for newbuild island rigs
The drilling arm of Abu Dhabi National Oil Co. (ADNOC) has secured a significant contract valued at around $806mn from ADNOC Offshore to supply three technologically advanced island rigs. This award ... more
China’s CNOOC bypasses US and signs LNG deal with ADNOC amid escalating tariff war
State-run China National Offshore Oil Corporation (CNOOC) has come to agreement with Abu Dhabi National Oil Corp (ADNOC) to purchase LNG from the Gulf company, Reuters reported on April 21 ... more
ADNOC Drilling wins offshore services deal amid expansion drive
Abu Dhabi National Oil Co.'s (ADNOC) drilling arm has landed a significant five-year contract valued at $1.63bn (AED5.99bn) from sister company ADNOC Offshore. ADNOC Drilling confirmed the award ... more