Bank of Sharjah served as a Joint Lead Manager and Bookrunner for Kuwait International Bank (KIB)'s issuance of a US$300 million Additional Tier 1 (AT1) sukuk. This collaboration involved a consortium of prominent international and regional banks, signifying the widespread interest in the offering.
The significance of this issuance lies in several aspects. Firstly, it represents the first US dollar AT1 sukuk issued by Kuwait since 2021. This highlights KIB's proactive approach in tapping into the US dollar capital markets, building on the success of their previous issuances – a Tier 2 sukuk in 2020 and an inaugural AT1 sukuk in 2019.
Secondly, the issuance garnered strong investor participation, with order books exceeding expectations and reaching an oversubscription level of 2.2 times. This robust response reflects the confidence that international and regional investors have in KIB's financial strength and operational performance.
Furthermore, the issuance concluded with a highly attractive spread of 195 basis points above US Treasuries. This achievement establishes a new benchmark for the tightest spread ever achieved for an AT1 issuance in the Central, Eastern Europe, Middle East, and Africa (CEEMEA) region. This competitive pricing positions the issuance favorably on a global scale when compared to other AT1 issuances.
Commenting on the success of the issuance, Mohamed Khadiri, CEO of Bank of Sharjah, expressed his satisfaction. In a statement released through the UAE state news agency WAM, he noted that the positive outcome serves as a testament to KIB's "effective access to sukuk markets and the trust international and regional investors place in the bank's financial resilience and operational performance."
The successful execution of this landmark sukuk issuance by Bank of Sharjah for Kuwait International Bank underscores the growing importance of Islamic finance instruments within the regional financial landscape. It also highlights the expertise and leadership that Bank of Sharjah brings to the table as a facilitator of such complex financial transactions.