Dubai Islamic Bank (DIB) has issued its second US dollar sustainable Sukuk worth US$1 billion on the 13th February 2023. The issuance, which represents an upsize from the bank’s debut sustainable Sukuk issuance worth US$750 million in November 2022, was three times oversubscribed.
“The investor response for this latest issuance was overwhelming with more than US$3 billion of orders allowing us to issue a larger size well within our pricing parameters,” Dr Adnan Chilwan, group CEO of DIB, commented.
Dr Adnan noted that the bank is hoping to contribute to the UAE’s long-term sustainability objectives as it gears up for the upcoming 28th United Nations Climate Change Conference of the Parties (COP28). “We hope the success of our offering will encourage other issuers from the UAE to follow suit in this format.”
According to the program prospectus, a working group comprising representatives from corporate, treasury, investment banking, finance, risk and investor relations will be established as a subcommittee of DIB’s management credit committee to evaluate and select projects to channel Sukuk proceeds toward.
The Islamic bank can allocate the proceeds from the Sukuk program toward the financing or refinancing of eligible green and social projects. Green projects include renewable energy, energy efficiency, clean transportation, green buildings, pollution prevention and control as well as sustainable water and wastewater management projects.
Eligible social projects include employment generation and programs designed to prevent and or alleviate unemployment stemming from socioeconomic crises, affordable housing and access to essential services.
Notably, the Sukuk program excludes financing payday loans. ISFI reached out to the bank late last year for comment on why payday loans were part of the exclusion list. The bank did not provide clarification on the basis for its exclusion.
While DIB has a remaining US$5.75 billion it is able to issue under its current program size of US$7.5 billion, it is notable that the bank and the Sukuk trustees are able to upsize the program in accordance with the terms of the program agreement, further increasing DIB’s capacity to issue sustainable Sukuk.
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DIB’s second sustainability Sukuk US$1 billion  13th February 2023 |
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| Summary of terms and conditions | |
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Issuer |
DIB Sukuk |
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Obligor |
Dubai Islamic Bank |
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Size of issue |
US$1 billion |
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Tenor |
Five years |
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Issuance price |
102.4bps over the five-year US treasury bill |
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Profit rate |
4.8% |
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Currency |
US dollar |
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Maturity date |
13th February 2028 |
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Lead manager(s) |
Bank ABC, Dubai Islamic Bank, Emirates NBD Capital, First Abu Dhabi Bank, HSBC, KFH Capital, Mashreq, Sharjah Islamic Bank, Standard Chartered Bank and the Islamic Corporation for the Development of the Private Sector |
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Sustainability structurer(s) |
Standard Chartered Bank |
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Bookrunner(s) |
Bank ABC, Dubai Islamic Bank, Emirates NBD Capital, First Abu Dhabi Bank, HSBC, KFH Capital, Mashreq, Sharjah Islamic Bank, Standard Chartered Bank and the Islamic Corporation for the Development of the Private Sector |
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Governing law |
English law |
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Islamic structure |
Ijarah |
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Listing |
NASDAQ Dubai,
Euronex Dublin
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Rating |
‘A’ by Fitch Ratings and ‘A3’ by Moody’s Investors Service |
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Shariah advisor(s) |
Shariah supervisory committee of Dubai Islamic Bank
Dar Al Sharia Islamic Finance Consultancy
Standard Chartered Global Shariah Supervisory Committee
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Tradability |
Yes |
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Face value/minimum investment |
US$100,000 |