Dukhan Bank's $500mn debut sukuk issuance has been oversubscribed 4.5 times, confirming its financial strength and the confidence enjoyed by it and the Qatari economy amongst the global investors.
The issuance of Additional Tier 1 sukuk with a value of $500mn and profit rate of 3.95%, the lowest rate for this type of issuance in the Qatari market, has seen order booking peaking at $2.35bn, a bank spokesman said.
On the oversubscription, he said it is further indicative of the strong methodology adopted by the Qatar Central Bank in its supervision of the banking sector.
"Dukhan Bank will continue to implement its strategic plans and move steadily towards strengthening its leadership on all levels," its chairman and managing director Sheikh Mohamed bin Hamad bin Jassim al-Thani said, adding the success achieved by the issuance of this sukuk which follows alongside "significant" investor demand.
The issuance comes after a series of global investor meetings and presentations led by Dukhan Bank’s senior management team. It is the latest step in the bank’s endeavours to increase its suite of banking products and financial services to strengthen its position in the Islamic banking sector, supported by “A” and “A2 / Prime-1” with a stable outlook by Fitch and Moody’s global ratings.
Khalid al-Subeai, chief executive of Dukhan Bank, said the issuance has seen significant global demand from investors that far exceeded expectations and included more than 84 investors in more than 19 countries.
"This is an indication of the confidence and good reputation Dukhan Bank and the Qatari economy enjoy amongst the global investor base. Moreover, it is supported by the bank’s strong financial position and distinguished ratings by international rating agencies,” according to him.
He said the bank believes that the issuance of this sukuk is a testament to its competitive market positioning post-merger. The bank has been formed by the merger of Barwa Bank and International Bank of Qatar.
Dukhan Bank appointed Standard Chartered Bank to act as sole global coordinator. Citi, Credit Suisse, J P Morgan, KFH Capital, Q-Invest, QNB Capital, Société Générale and Standard Chartered Bank acted as joint lead managers and book runners.