The UAE Ministry of Finance has announced that its Government Treasury Bonds Programme and Dirham-denominated Islamic Treasury Sukuk Programme have issued a total of AED 25 billion since their launch through August 2024.
The programmes, initiated in 2022, have seen Treasury Bonds worth AED 11.2 billion and Islamic Treasury Sukuk worth AED 13.8 billion issued.
“The UAE continues to cement its position as one of the most competitive and advanced economies in the world. This success reflects the country’s strong creditworthiness and substantial economic capabilities, which support the robust performance of the financial sector and contribute to sustainable growth, providing secure and advanced investment alternatives denominated in UAE dirhams for investors, and enhancing the investment environment in the country,” Sheikh Maktoum bin Mohammed bin Rashid Al Maktoum, First Deputy Ruler of Dubai, Deputy Prime Minister and Minister of Finance said.
The Government Treasury Bonds and Islamic Treasury Sukuk programs, launched by the Ministry of Finance in 2022, achieved exceptional results. Since their launch and up to the end of August 2024, Treasury Bonds worth AED 11.2 billion and Islamic Treasury Sukuk worth AED 13.8… pic.twitter.com/0Y5oWjZcjg
— Maktoum Bin Mohammed (@MaktoumMohammed) September 22, 2024
UAE government treasury bonds and sukuk programmes reach AED 25bn
In May 2024, the Ministry settled AED 4.85 billion in two-year Treasury bonds, bringing the total outstanding bonds to AED 6.35 billion, the Emirates News Agency (WAM) said in a statement.
As of August 2024, the total outstanding domestic public debt for both programmes reached AED20.15 billion.
The UAE has achieved a sovereign credit rating of AA- with a stable outlook from Fitch Ratings and an Aa2 rating in creditworthiness from Moody’s, the highest in the region.
The Treasury Bonds Programme, launched in collaboration with the Central Bank of the UAE, uses the Bloomberg Auction System for settlement.
Six major banks in the UAE serve as primary distributors: Emirates NBD, Abu Dhabi Commercial Bank, First Abu Dhabi Bank, Mashreq Bank, HSBC, and Standard Chartered Bank.
The Islamic Treasury Sukuk Programme, introduced following the success of the Treasury Bonds Programme, follows similar practices and standards.
Two additional banks, Abu Dhabi Islamic Bank and Dubai Islamic Bank, were added as primary distributors for this programme.
Both programmes have seen strong demand, with auctions consistently oversubscribed. The bonds and sukuk are issued in two, three, and five-year tranches, with plans for longer-term issuances in the future.
Sheikh Maktoum further emphasised the importance of “continuing efforts to launch and support transformative initiatives and projects, which contribute to the development of the financial sector and support the country’s future strategic plans. He also highlighted the significance of strengthening partnerships with all entities and achieving effective integration in implementing developmental and strategic projects, working on proactive initiatives to ensure future readiness, meet the aspirations of the coming phase, and contribute to the comprehensive and sustainable development witnessed by the UAE,” the statement added.
The programmes aim to build a local currency bond market, develop the medium-term yield curve, diversify funding sources, and provide secure investment alternatives for local and foreign investors in the local currency.
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