Bank of Sharjah sets guidance for senior bond issue

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Bank of Sharjah P.J.S.C. (BOS:ADX) has set guidance for its US$ 500 million (AED 1.84b) 5-year senior unsecured bond. Guidance for the bond was confirmed by lead arrangers on Monday at 180 basis points (bps) over midswaps (a benchmark for calculating bids), plus or minus 5 bps.

The bank ran an roadshow with lead arrangers from 21 to 25 May meeting investors in London, UK, Geneva and Zurich in Switzerland, Singapore and the United Arab Emirates. JP Morgan and National Bank of Abu Dhabi were appointed as joint coordinators for the bond issue.

The new bond follows two major bond issues from Sharjah over the past 12 months. The Government of Sharjah issued its first sovereign sukuk at a size of US$ 750 million (AED 275b) with a lifespan of 10 years in September 2015. Earlier this year, Sharjah Islamic Bank (SIB) issued an unsecured US$ 500 million (AED 1.8b) 5-year sukuk.

Credit rating agency Fitch, has already assigned a provisional rating of BBB+(EXP) to Bank of Sharjah’s Cayman Islands registered BoS Funding Limited, the issuer of the new bond.

The bank’s board of directors disclosed the bank’s intention to issue a senior unsecured bond with a five-year term to shareholders in April.
Bank of Sharjah recently announced an 8 percent increase in first-quarter profits for 2015, following a tough 2014 during which bank net profit fell by 19 percent from AED 353 million in 2013 to AED 286 million last year.

Source: Bank of Sharjah, media