Dubai – Mubasher: Emirates Development Bank (EDB) plans to issue bonds worth $750 million in February to be the first to make use of the UAE’s newly effective debt law, a senior government official said.
This will be the first debt issuance to be offered by EDB, a state-owned institution that provides financing to citizens and small and medium-sized enterprises (SMEs), since the institution started operating in 2015, the undersecretary at the UAE Ministry of Finance, told Bloomberg News on Saturday.
“We are aiming for a certain yield and hopefully the market will not change much over the coming few weeks,” Younis Al Khoori added.
He added that the debt proceeds will be transferred to the UAE’s economy by providing loans to SMEs and housing, along with securing cost savings.
Al Khoori said that the bank can offer more than $5 billion in bonds under its establishment mandate approved by the council of ministers.
In October 2018, the UAE passed a law allowing the federal government to issue sovereign debt for the first time and enabling its seven emirates to benefit from a higher credit rating and lower borrowing costs.
The UAE’s finance ministry is currently working with the Central Bank to reach clear-cut policies for issuing debt instruments in a bid to manage liquidity as part of Basel III requirements under the new law.
