Post by : Badri Ariffin

In a successful collaboration between the UAE Ministry of Finance (MoF) and the Central Bank of the UAE (CBUAE), the May 2026 auction of dirham-denominated Treasury Bonds (T-Bonds) yielded AED1.1 billion.

This auction was part of the annual T-Bonds issuance programme, as outlined by the Ministry of Finance, with the Central Bank serving as the issuing and payment agent.

The event attracted significant interest from primary dealers, resulting in bids totaling AED4.74 billion. This high demand indicates an oversubscription rate of 4.3 times, reflecting sustained investor confidence in the UAE's robust financial framework and stable economy.

The issuance encompassed two T-Bond tranches set to mature in September 2027 and January 2031.

Competitive pricing was achieved, with a Yield to Maturity (YTM) of 4.03 percent for the September 2027 tranche and 4.30 percent for the January 2031 tranche. These yields were noted at a narrow spread of up to 14 basis points above similar U.S. Treasury bonds during the issuance.

Additionally, the Ministry confirmed that the T-Bonds are listed on Nasdaq Dubai, enhancing investor access and facilitating secondary market trading options.

This marks the third successful bond issuance by the UAE amid the ongoing regional conflict, with a total of AED3.3 billion raised and over AED14.5 billion in bids received across the three issuances. Pricing spreads for these issuances varied between 6 and 23 basis points for tenors ranging from 18 months to 7 years.

The UAE’s T-Bond and T-Sukuk programmes continue to be pivotal in bolstering the country’s dirham-denominated yield curve, offering secure investment avenues, enhancing the local debt capital market, and contributing significantly to the UAE’s long-term economic growth and sustainability ambitions.

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