Ajman Bank Successfully Prices $500 Million Inaugural Sukuk With Strong Investor Demand

Ajman Bank P.J.S.C., the first Islamic bank established in Ajman, has successfully launched its inaugural Sukuk. This US$500 million, 5-year Sukuk was priced at a credit spread of 130 basis points above the U.S. treasury rate, resulting in a fixed profit rate of 5.125% annually. The issuance attracted significant interest, with an orderbook exceeding US$2.7 billion, indicating a 5.4 times oversubscription from over 100 investors.

To mark its debut in international capital markets, Ajman Bank engaged in extensive marketing efforts across Hong Kong, Singapore, Malaysia, London, and the UAE. These meetings allowed the bank to present its updated business strategy aimed at enhancing financial performance and positioning for growth within the UAE's dynamic economy.

The transaction saw participation from major institutional investors globally and regionally. This resulted in geographic diversification with 35% of the allocation going to international investors and 65% to regional ones. Mustafa Al Khalfawi, CEO of Ajman Bank, expressed satisfaction with the strong investor response, stating it underscores confidence in both Ajman Bank and the UAE's economic environment.

Despite uncertainties due to recent U.S. trade tariffs, Ajman Bank seized market opportunities by announcing its Sukuk issuance on a Tuesday morning. Investor calls were conducted throughout the day with fund managers from Europe, Asia, and the U.S., leading to accelerated execution and closure by Wednesday.

Initial price thoughts (IPTs) were set at U.S. treasuries plus 165 basis points but tightened to plus 130 basis points by noon Wednesday in London. This 35 basis point reduction highlights the high-quality orderbook comprising top fund managers, banks, pension funds, and insurance companies.

Ajman Bank holds a BBB+ rating from Fitch with a stable outlook. The Sukuk will also receive a BBB+ rating from Fitch and be listed on both Nasdaq Dubai and London's International Securities Markets. Key players involved included Standard Chartered Bank, Emirates NBD Capital, First Abu Dhabi Bank as Joint Global Coordinators; J.P. Morgan acted as Joint Lead Managers alongside several other banks.

The successful issuance marks a significant milestone for Ajman Bank as it diversifies its funding sources while reinforcing its presence in international markets. The bank's strategic approach reflects its commitment to growth amid evolving market conditions while maintaining robust asset quality.

This initiative not only strengthens Ajman Bank's financial foundation but also enhances its reputation among global investors who are increasingly recognising the potential within the Emirate of Ajman and broader UAE economy.

With inputs from WAM