Ajman Bank P.J.S.C., the first Islamic bank headquartered in the Emirate of Ajman, has successfully priced a US$500 million 5-year Sukuk with a fixed profit rate of 5.125% per annum, reflecting a credit spread of 130 basis points over the U.S. Treasury rate. The transaction has been hailed as a major milestone for the bank, marking its first-ever Sukuk issuance and significantly diversifying its funding platform.
The Sukuk issuance received overwhelming demand, with the order book peaking at over US$2.7 billion, representing an oversubscription rate of 5.4x. More than 100 investors participated, including both international and regional institutional investors, highlighting strong confidence in Ajman Bank and the UAE’s economic stability. The allocation was split with 35% of the Sukuk directed to international investors and 65% to regional investors, ensuring a broad geographic diversification.
Mustafa Al Khalfawi, CEO of Ajman Bank, expressed his satisfaction with the transaction’s success, stating, “We are pleased with the success of our inaugural Sukuk issuance and the strong response from investors which highlights the confidence placed by international and regional investors in Ajman Bank, the growing prominence of the Emirate of Ajman, and the robustness of the broader UAE economy.”
To support the Sukuk launch, Ajman Bank conducted an extensive marketing campaign, engaging with investors in key markets such as Hong Kong, Singapore, Malaysia, London, and the UAE. The bank used these meetings to share details of its new growth strategy, which aims to improve financial performance and position the bank for future growth within the UAE’s dynamic economy.
Ajman Bank’s decision to proceed with the Sukuk issuance came amid uncertainty caused by trade tariffs imposed by the United States. However, after receiving positive feedback from investors, the bank accelerated the process, with pricing adjusted from initial price thoughts (IPTs) of U.S. treasuries plus 165 basis points to final pricing of U.S. treasuries plus 130 basis points. This price tightening reflects the high-quality demand for the issuance, which included major global fund managers, banks, and insurance companies.
The Sukuk has received a BBB+ rating from Fitch, with a stable outlook, and will be listed on the London Stock Exchange’s International Securities Markets and Nasdaq Dubai.
The Joint Global Coordinators for the transaction were Standard Chartered Bank, Emirates NBD Capital, First Abu Dhabi Bank, and J.P. Morgan, with several other institutions also acting as Joint Lead Managers and Bookrunners.
