The Middle East debt market may be navigating geopolitical turbulence, but investors still lined up eagerly for paper from the UAE’s biggest lender. First Abu Dhabi Bank
locked in $700 million through a five-year sukuk deal on Wednesday, attracting orders that climbed beyond $1.5 billion before books closed.
The Islamic issuance, structured under a Wakala and Murabaha format, was priced at par with a semi-annual profit rate of 4.859%. Final pricing tightened sharply from the bank’s initial guidance of around 115 basis points over US Treasuries to 85 basis points, signaling strong appetite despite a cautious regional funding backdrop.
The sukuk, carrying senior unsecured status under Regulation S, was priced against a benchmark Treasury yield of 4.009%. It will be issued through FAB’s $5 billion trust certificate programme and is expected to list on the main market of the London Stock Exchange.
Banks and private banking clients dominated allocations, accounting for roughly 62% of demand, while fund managers absorbed another 28%. Regional investors from the Middle East and North Africa made up half the orderbook, with European and UK accounts contributing nearly a quarter.
The transaction arrives during a subdued period for Gulf debt capital markets, as heightened tensions linked to the US-Iran conflict have slowed issuance activity across the region. Even so, major UAE lenders continue finding receptive buyers. Less than two weeks ago, Emirates NBD
returned to the market with a $750 million perpetual AT1 offering.
For FAB, the sukuk marks its fourth international funding exercise this year and its first Sharia-compliant outing of 2026. Earlier transactions included a £450 million sterling-denominated bond sale in February, following two separate $750 million raises completed in January, one of which included a Formosa tranche.
The lender’s previous sukuk came in January last year, when it secured $600 million through a five-year Islamic bond priced at 5.153%, or 70 basis points above US Treasuries.
