Dubai Islamic Bank Successfully Issues USD 1 Billion Sustainability-Linked Sukuk To Support Sustainable Finance

Dubai Islamic Bank (DIB) has successfully entered the global Sukuk market with a USD 1 billion Sustainability-Linked Sukuk. This financial instrument is priced at a 4.572% annual profit rate and has a five-year term. This marks DIB's inaugural issuance of a Sustainability-Linked Sukuk, underscoring its dedication to innovative financial solutions and sustainability, aligning with the UAE’s Net Zero 2050 Initiative.

The new Sukuk structure represents an evolution in Islamic sustainable finance by linking impact directly to measurable performance targets. This approach shifts from traditional use-of-proceeds models to performance-linked impact. Through this framework, DIB aims to channel investor funds into a diversified portfolio of sustainability-linked financing for clients committed to achieving specific sustainability KPIs.

DIB's commitment to sustainability is evident in its long-term strategy, which integrates responsible finance and ESG principles. The bank's Sustainability-Linked Financing Framework received a Second-Party Opinion from Institutional Shareholder Services (ISS), confirming its alignment with international best practices and standards for Sustainability-Linked Sukuk.

The issuance attracted significant global interest, with the orderbook reaching USD 2 billion, twice the amount offered. Over 80 institutional accounts from Europe, Asia, and the Middle East participated. Notably, 67% of the Sukuk was allocated to the MENA region, while Asia received 20%, marking the highest Asian allocation in any public Sukuk issuance by DIB.

Marketing for the Sukuk began on Monday, 10 November, through several investor calls presenting DIB's financial performance for the first nine months of 2025. Despite a crowded market with multiple transactions occurring simultaneously, investor reception was positive. The orderbook opened on Wednesday, 12 November with Initial Price Thoughts set at 120 basis points over US Treasuries.

The strong demand allowed final pricing to tighten to 90 basis points over US Treasuries, equating to a profit rate of 4.572% per annum. Dr. Adnan Chilwan, Group CEO of DIB, stated: "This Sukuk issuance is a defining step in our sustainability journey and a clear reflection of the strong confidence international investors continue to place in DIB."

Strategic Partnerships and Future Outlook

The Sukuk was issued under DIB's USD 12.5 billion Sukuk Programme, dual-listed on Euronext Dublin and Nasdaq Dubai stock exchanges. Standard Chartered Bank acted as Sustainability Advisor for this transaction. Joint Lead Managers included Arqaam Capital, Bank ABC, Emirates NBD Capital, First Abu Dhabi Bank among others.

Dr. Chilwan further commented on the significance of this issuance: "As the world’s first Islamic bank... It is to lead with purpose and to demonstrate how Islamic finance can deliver measurable and responsible impact that is transparent..." He emphasised that this reflects DIB’s progression from intention to performance in embedding long-term sustainability across its business.

This initiative confirms that markets increasingly value institutions rooted in faith-based integrity and disciplined execution with a clear vision for sustainability. DIB remains committed to advancing this agenda ensuring growth contributes real economic value and societal benefit.

With inputs from WAM