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DUBAI- Qatar's Dukhan Bank sold $500 million in Additional Tier 1 (AT1) sukuk, or Islamic bonds, at 3.95% on Wednesday after it received more than $2.25 billion in orders, a document showed.
The perpetual sukuk were tightened from initial price guidance of around 4.375%.
AT1 bonds, the riskiest debt instruments banks can issue, are designed to be perpetual but issuers can call them in after a specified period. Dukhan's sukuk cannot be called in for 5-1/2 years.
The debt sale follows a steady stream of AT1 issuance from banks in the oil-producing Gulf, where banks have usually turned to senior bonds. With ample liquidity, they have looked to bolster Tier 1 capital - the core measure of a bank's capital.
Last month saw regional AT1 sales from Saudi Arabia's Bank AlJazira, Kuwait Finance House and Kuwait's Ahli United Bank.
Citi, Credit Suisse, JPMorgan, KFH Capital, QInvest, QNB Capital, and Societe Generale arranged the Dukhan Bank deal.
(Reporting by Yousef Saba; Editing by Jacqueline Wong and Edmund Blair) ((Yousef.Saba@thomsonreuters.com; +971562166204; https://twitter.com/YousefSaba))