Dubai’s government mandated HSBC, Deutsche Bank and Standard Chartered to issue a benchmark dollar bond, it said on Monday, in its first debt sale since November’s crisis.
In a statement, the government said the bond would be launched shortly, and that the proceeds would be used for general budgetary purposes. It did not specify the amount but a benchmark bond issue is at least $500 million.
Banking sources told Reuters last week that Dubai planned to issue up to $1 billion in bonds with a tenor of up to seven years.
The emirate is determined to get a credit rating, a top financial official said on Sunday, but not immediately. Such a rating would help its bond issue find wider investor appeal and revive the local bond market activity, analysts said.
Dubai’s last sovereign bond sale was launched last October, barely a month before its flagship conglomerate Dubai World shocked global investors by calling for a standstill on its debt. Dubai World reached an agreement with nearly all creditors earlier this month for its debt plan.