Islamic Treasury Sukuk Auction For November 2025 Attracts AED 5.48 Billion In Bids

The Ministry of Finance (MoF) and the Central Bank of the UAE (CBUAE) have successfully concluded the November 2025 auction for UAE dirham-denominated Islamic Treasury Sukuk (T-Sukuk). The total issuance reached AED1.1 billion, marking the final auction for 2025 under this programme. This event saw significant interest from eight primary dealers across tranches maturing in October 2027 and May 2030.

Investor confidence in the UAE's creditworthiness and Islamic finance framework was evident as total bids amounted to AED5.48 billion, indicating an oversubscription rate of five times. The auction results showcased competitive pricing with a yield to maturity (YTM) of 3.52% for the October 2027 tranche and 3.63% for the May 2030 tranche, reflecting a narrow spread of up to five basis points above comparable US Treasuries.

Throughout 2025, nine auctions were conducted by the Ministry, resulting in a total issuance of AED9.9 billion with maturities ranging from two to five years. Total bids received during the year reached AED53.8 billion, demonstrating an average oversubscription rate of 5.4 times. This consistent demand underscores investor trust in UAE sovereign dirham-denominated Islamic instruments.

The T-Sukuk are listed under the UAE Treasury Islamic Sukuk Programme on Nasdaq Dubai, enhancing investor access in secondary markets. This listing facilitates greater transparency and accessibility for investors and issuers alike, allowing them to benchmark their spreads against the sovereign yield curve for domestic currency capital market issuances.

The regular issuance activity has been instrumental in developing and strengthening the local currency Dirham yield curve, which is now accessible on Bloomberg. This development enhances transparency for investors and provides a benchmark for other issuers considering domestic currency capital market issuances.

The Islamic T-Sukuk programme plays a crucial role in shaping the UAE’s dirham-denominated yield curve by offering secure investment options to a diverse range of investors. It also bolsters the local debt capital market, contributing to a broader investment landscape that supports long-term economic sustainability and growth objectives in the UAE.

The programme's competitive pricing achieved an average spread of only three basis points above comparable US Treasuries at issuance time, highlighting strong demand for these instruments. Such strategic initiatives align with the UAE's goals of fostering economic growth while ensuring financial stability through diversified investment opportunities.

With inputs from WAM