Middle East Bonds

Four Gulf borrowers have provided a mixed bag of deals this week. While Taqa and Noor sold solid new bonds, this week’s debut issuers did not fare so well. Omantel traded wildly on the break and unrated Qatari conglomerate Mannai fared worse of all, pulling its deal.

Jamal Al Kishi has been appointed chief country office for the United Arab Emirates and general manager of Deutsche Bank's Dubai (DIFC) branch.

United Arab Emirates based Noor Bank has launched its five year Reg S sukuk at 165bp over mid-swaps, with order books over $1bn, including joint lead manager interest.

After the Qatari sovereign launched its $12bn triple tranche return to the bond market last week, Mannai Corporate, a conglomerate from the country, is following it into the market this week. Mannai is looking to print a senior perpetual non-call five Reg S only dollar bond. It will be the company’s debut in the bond market.

Omantel has released price guidance for its long five and 10 year dual tranche bond at a level one EM trader in London is calling “real cheap” at 100bp over the Oman sovereign curve.

Abu Dhabi National Energy Company (Taqa) has opened books on a dual tranche deal, its first since 2016, which bankers say is an encouraging sign that markets are normalising after a choppy week driven by geopolitical risk.

Some 10 months after the eruption of the Gulf diplomatic crisis last summer, Saudi Arabia and Qatar have proved that the market is big enough for both of them, printing $11bn and $12bn deals respectively, and garnering a combined book exceeding $100bn.

The State of Qatar had taken orders of $32.5bn by lunchtime on Thursday, putting to bed any concerns that Saudi Arabia’s $11bn trade would cannibalise demand for its regional rival. In fact the strong performance of Saudi’s paper in the secondary market has helped boost support for Qatar’s trade, according to a banker on the deal.

Two Middle Eastern issuers were on track to price sukuk on Wednesday, but Saudi Arabia’s jumbo $11bn bond has cast a shadow over Sharjah Islamic Bank’s trade and led to decreased demand from outside of the region, according to a Dubai-based banker on that deal.

The Kingdom of Saudi Arabia printed its $11bn bond on Tuesday, which several bankers and investors thought had been timed to maximise disruption of Qatar’s return to market, which is also expected this week. But leads said the modest size taken by Saudi from a $50bn book showed that there was no intention of throwing the capital markets into disarray.

Saudi and Qatar look to be printing jumbo bonds this week, but the timing of both in the same few days after so many months of waiting is prompting chatter about which sovereign has caused the traffic jam and whether political machinations are behind it.

Mannai Corp, a Qatari conglomerate, looks set to bring the first public bond from the country since the Gulf diplomatic crisis erupted last summer.