The Ras Al Khaimah Government on Wednesday completed the formal documentation signing for its landmark $400 million Sukuk issue, with Standard Chartered Bank, BNP Paribas and Liquidity House acting as Joint Bookrunners.

This is both the first US dollar Sukuk issued by a Sovereign under a programme and by an emirate in the UAE.

It is the second issuance under the Government’s $2 billion Sukuk Programme. The first issuance was an Dh1 billion Sukuk issue in May 2008 in which Standard Chartered Bank acted as sole arranger and sole bookrunner, said a senior official.

At the signing Ceremony, Sheikh Saud Bin Saqr Al Qasimi, Ras Al Khaimah crown prince and deputy ruler said, 'We are extremely pleased with the strong investor response to the Sukuk issue which serves as an indication of the Ras Al Khaimah Government’s continued credibility with the international investor community.'

'I would like to thank both Standard Chartered Bank and BNP Paribas for the integral role they played towards the success of this well-distributed issue which will establish a liquid benchmark for the Government in the US dollar markets.'

The timing of the Government’s second foray into the international capital markets was critical.

It took place against the back-drop of positive investor sentiments towards high-grade government issuers and a scarcity of US dollar Sukuk paper in the international capital markets.

Shayne Nelson, regional chief executive, Standard Chartered Mena commented, “The government of Ras Al Khaimah has a strong strategic vision and plan for their esteemed emirate and the success of this Sukuk issuance reaffirms the Government’s leadership, commitment and capabilities.

The Sukuk is a key milestone not only in the continued development of Ras Al Khaimah but also in the evolution of Islamic Banking.

Based on the strong investor response received during the roadshows, the Government announced its intentions for a second issuance under its Sukuk Programme, releasing a price whisper in the 8 per cent to 8.5 per cent area for a 5-year issuance on July 14, said the RAK official.

This was followed by the release of official price guidance of 8 to 8.25 per cent for a target issue size of $300 – $500 million on July 14.

The order book grew rapidly to over $1.65 billion with over 120 investors, despite being open for only 24 hours in the Middle East and Asia and only six hours in Europe, he noted.

The transaction received strong interest from investors across the Reg S markets, with final allocations of Middle East 47 per cent, Asia 34 per cent and Europe 19 per cent.-TradeArabia News Service