Abu Dhabi: Abu Dhabi Securities Exchange (ADX) in association with Abu Dhabi’s Department of Finance (DOF) launched today the first listing of government bonds in a step towards building a bond market operating under the best standards as with international financial markets.
The listing solidifies the status of the Emirate of Abu Dhabi as regional and global financial centre offering vast investment opportunities.
The listing ceremony which was held at ADX headquarters was attended by H.E. Mohammed Sultan Bin Ghannoum Al Hameli, Director General of Department of Finance and Rashed Al Balooshi, Chief Executive of ADX, in the presence of senior staff from both sides and a group of investors.
The total amount of the bonds listed is $1.5 billion, with a maturity date in 2019. The listing follows the approval of regulations by the Securities and Commodities Authority (SCA) for the issuance of local debt instruments and their listing on ADX. The Abu Dhabi Department of Finance announced last year its intention to dual list the bonds in ADX and the London Stock Exchange (LSE). Investors will be able to trade in the bonds in both LSE and ADX simultaneously.
The adoption of these new regulations paves the way for new debt instruments to be listed and traded on ADX as their primary platform, which will help to create a more attractive and dynamic climate for investment in Abu Dhabi.
The National Bank of Abu Dhabi (NBAD) will act as ADX’s account operator. Settlement and clearing will take place via NBAD through ADX’s participant account at Euroclear, which specializes in the settlement of securities transactions as well as the safekeeping and asset servicing of these securities. Investment in the bonds will be limited to Qualified Investor Buyers (QIB).
“The dual listing of the bonds will help to enhance the investment exposure of the local markets and to reinforce Abu Dhabi’s position as a regional and international financial centre able to attract investment and provide investors with diverse options in the securities and bond markets,” H.E. Mohammed Sultan Bin Ghannoum Al Hameli, Director General of Department of Finance-Abu Dhabi, said.
“The Emirate of Abu Dhabi leads the economies of the Middle East in the field of credit rating. The Emirate also posses the confidence of investors from all around the world as the Emirate has preserved its ranking among the least risky economies in the credit markets as well as being the most capable of fulfilling its financial commitments in the past years.”
“Our ongoing efforts and strategic initiatives aim at reinforcing Abu Dhabi as a centre of excellence in the region and enhance its leading position as a capital market hub. ADX embraces international best practices to meet the evolving needs of its investors locally and internationally,” Rashed Al Balooshi, CEO of ADX, said.
“Boosting investment flows and institutional participation is one of the most important priorities of ADX in the next stage as they have a significant impact in attracting capital to the Emirate of Abu Dhabi and in promoting the emirate as a preferred destination for global investment. In addition, institutional investment plays an active role in stabilizing the financial markets and consequently the national economy. We hope that this dual listing will be followed by more similar listings,” Rashed Al Balooshi, CEO of ADX, said.
There are currently three companies trading on ADX which are cross listed, which are Ooredoo, Sudatel, and Oman and Emirates Investment Holding Company. Only one other bond is listed on ADX, which is by NBAD in the form of subordinated convertible notes.