$700 million Sukuk is DIFCI's first debt issuance since 2007
BNY Mellon, a global leader in investment management and investment services, has been appointed delegate, principal paying agent, registrar and transfer agent for a Sukuk launched by DIFC Investments LLC (DIFCI).
The 10-year Sukuk, priced at $700 million, will pay a 4.3 percent profit rate per annum. The joint lead managers on the issuance are Dubai Islamic Bank PJSC, Emirates NBD Capital, Noor Bank P.J.S.C. and Standard Chartered Bank. The Sukuk was assigned a BBB- credit rating by Standard & Poor's.
His Excellency Essa Abdulfattah Kazim, Governor of DIFC, said, "This is DIFC's first debt issuance since 2007 and is testament to the improved credit fundamentals of both the company and Dubai. DIFC has played an important role in supporting the development of Islamic finance by undertaking a sole listing of the Sukuk on NASDAQ Dubai which reinforces the vision of H.H. Sheikh Mohammed bin Rashid Al Maktoum of Dubai as the global hub for Islamic finance."
The volume of Sukuk issuance in the Gulf region this year has already surpassed $20 billion and is 27 percent higher than the same period last year.
"We expect the Gulf's Islamic finance industry to maintain its rapid growth," added Dean Fletcher, CEO of Corporate Trust EMEA at BNY Mellon. "This expansion will be driven by ambitious projects in the region such as the 2020 World Expo trade convention in Dubai which will stimulate more demand for exhibition centres, transport networks and hotels. We are also seeing strong investor demand; the DIFCI Sukuk was over four times oversubscribed and priced at 185 basis points above the US dollar mid-swaps rate."
DIFC Investments LLC is the investment arm of the Dubai International Financial Centre which is a free zone that promotes the growth and development of financial services in the United Arab Emirates.
BNY Mellon has been conducting business in the Middle East and Africa for nearly 100 years. The company was granted a branch licence in 2008 by the Dubai Financial Services Authority (DFSA). The Dubai office acts as a regional management and line of business hub supporting representative offices in Abu Dhabi, Beirut, Cairo, Istanbul & Johannesburg. BNY Mellon works with a wide range of financial institutions, governments and other clients throughout the region, offering issuer services and correspondent banking services, as well as custody and asset management services.
As of September 30, 2014, BNY Mellon Corporate Trust served as trustee and/or paying agent on more than 61,000 debt-related issues globally. Its clients include governments and their agencies, multinational corporations, financial institutions and other entities that access the global debt capital markets. The corporate trust business utilizes its global footprint and expertise to deliver a full range of issuer and related investor services and to develop customized and market-driven solutions. Its range of core services includes debt trustee, paying agency, escrow and other fiduciary offerings.
Corporate trust providers are appointed by corporations, municipal governments and other entities issuing debt to perform a variety of duties, including servicing and maintaining the debt issue, processing principal and interest payments for investors, representing investors in defaults, and providing value-added services for complex debt structures.