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A series of roadshow meetings are being organised in Singapore, Hong Kong and London starting June 19 to attract investors for the Islamic bond to be used to boost the bank’s Tier 1 core capital ratio.
Sharjah Islamic Bank (SIB), one of the leading Islamic financial institutions in the UAE, has appointed banks to arrange investor meetings ahead of the issuance of a US dollar-denominated Islamic bond, also known as Sukuk, the bank has announced.
SIB has mandated Citi, HSBC and Standard Chartered Bank as Joint Global Coordinators and Joint Structuring Agents for a benchmark size T1 Sukuk issuance. The instruments are priced following a book building process and meetings with international investors which include fund managers, financial institutions, private banks and others, according to the bank.
Abu Dhabi Islamic Bank, Bank ABC, Citi, Deutsche Bank, Dubai Islamic Bank, Emirates NBD Capital, First Abu Dhabi Bank, HSBC, KFH Capital, and Standard Chartered Bank are the Joint Lead Managers and Joint Bookrunners for the offering.
“The SIB officials will meet key investors in various locations by conducting investor presentations or roadshows. At present, the bank is conducting roadshow meetings in Singapore, Hong Kong and London,” Mohammed Abdalla, CEO of Sharjah Islamic Bank said.
“We are meeting investors in Singapore and Hong Kong this week followed by meetings in London and look to price the transaction next week subject to market conditions” said Ahmed Saad, DCEO of Sharjah Islamic Bank.
We are receiving strong demand on this transaction since the beginning of the roadshow. With this issuance, we seek to strengthen our capitalisation ratios, particularly the bank’s Tier 1 core capital, to spur the growth of the bank through the benchmark fixed-rate resettable USD Regulation S Additional Tier 1 perpetual non-call six-year unrated sukuk, Ahmed Saad added.
Sharjah Islamic Bank had declared a net profit of Dh510.4 million in 2018 compared to Dh477.7 million in 2017, showing an increase of seven per cent. The Shariah-compliant lender proposed eight per cent cash dividend for the shareholders.
The SIB Sukuk would be one of the few debt issues in the pipeline in the Gulf region. According to Moody’s, global sovereign Sukuk issuance will increase to $87 billion in 2019, and rise towards $100 billion in 2020, from $78 billion in 2018.
This recovery, according to the rating agency, is expected to be driven by a combination of various sovereigns’ commitments to further Sukuk market development, higher Sukuk refinancing needs and expectations of higher budget deficits for the major sovereign Sukuk issuers in 2019-20.