The Government of Dubai, acting through its Department of Finance (DoF), yesterday said it has raised a further $5 billion (Dh18.36bn) as part of its $20bn long-term bond programme launched at the beginning of this year.

The department said the amount issued was determined by the emirate's current needs and obligations. The $5bn tranche was fully subscribed equally by National Bank of Abu Dhabi (NBAD) and Al Hilal Bank, and has been divided according to a schedule that specifies drawdown amounts and dates that are aligned to Dubai Financial Support Fund's objectives.

The tranche has a maturity of five years and "the coupon rate will be the same as the previous tranche", a DoF spokesperson told this paper. The first $10bn tranche was subscribed by the Central Bank in February at four per cent coupon rate. The first amount to be drawn down from the second tranche is $1bn, and will be split equally between a conventional bond issue to NBAD and a Shariah-compliant sukuk issue to Al Hilal Bank.

"This is basically part of our structure and existence," Sarie Arar, Executive Vice-President, Corporate and Investment Banking Group, Al Hilal Bank, told Emirates Business. "We believe in the UAE as one country. Dubai's Vision 2020 and Abu Dhabi's Vision 2030 are part of the UAE's overall vision. We are a 100 per cent government-owned bank, and our existence is to be a catalyst for these objectives," he said.

The department said the proceeds would be managed by and further strengthen the financial resources of the support fund.

The fund was established with the specific purpose of providing liquidity on a commercial basis to government and government-related entities undertaking projects deemed to be of strategic importance within Dubai that contribute towards the overall economic development of the emirate. 

The signing ceremony was attended by Abdulrahman Al Saleh, Director-General of the Department of Finance, Nasser Ahmad Khalifa Al Suwaidi, Chairman of National Bank of Abu Dhabi, and Ahmad Ateeq Al Mazroui, Chairman of Al Hilal Bank.

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