National Bank of Ras Al-Khaimah and Bank of Sharjah have added weight to the notion that the coming weeks should see a heavy supply of Middle East banks.

Otherwise known as Rakbank (Baa1/–/BBB+), the issuer is kicking off investor meetings on Friday for a US$250m 10.25-year non-call 5.25-year Reg S Tier 2 bond. Abu Dhabi Commercial Bank, Citigroup, Emirates NBD, First Abu Dhabi Bank and Standard Chartered are leads.

Bankers have said that issuance from the Middle East’s banking sector is likely to be plentiful as supply picks up in September. The view from traders is that this flow of paper should be well absorbed. Several have said that there has been a particularly strong bid in the space of late and it has been difficult to come by the bonds and sukuk of certain issuers.

Founded in 1976, Rakbank is 53% owned by the government of Ras Al Khaimah, one of the UAE’s seven emirates.

For an infrequent issuer, the Tier 2 marks a quick, if not entirely unexpected, return to the market for the bank. Earlier this year, Rakbank announced that it was considering issuing both conventional and Tier 2 capital to strengthen its capital adequacy ratio and support its growth.

In July, Rakbank priced a US$600m 5.375% July 2029 social senior bond. That was its first new issue since 2019 and is the bank’s only outstanding bond.

Although a relatively small bank in the context of the Middle East, when Rakbank issued in July one analyst told IFR that it had a good growth outlook, pencilling in loan growth of around 9% in 2024. In 2023, loan growth was around 10%. The business is skewed towards retail customers, who represent 48% of the loan book.

Meanwhile, Bank of Sharjah (BBB+ from Fitch) has begun marketing a US dollar benchmark five-year Reg S senior unsecured note, which is being issued alongside a tender offer on its US$600m 4% September 2024s.

Abu Dhabi Commercial Bank, Al Ahli Bank of Kuwait, Bank ABC, Citigroup, Doha Bank, Emirates NBD, First Abu Dhabi Bank, Kamco Invest, Mashreq, QNB Capital and Standard Chartered are running the deal.

Source: IFR