Abu Dhabi bonds are heading for their best quarter in a year. Union Investment and LCF Edmond de Rothschild CI Ltd. say investors are ready to snap up any new issue from the oil-rich Persian Gulf emirate.
The government’s 6.75 percent dollar-denominated non- Islamic notes due April 2019 have returned 6.6 percent, set for the biggest quarterly gain since September 2009, and more than the 6 percent increase for Qatar’s 5.25 percent debt maturing in January 2020, according to data compiled by Bloomberg. Dubai’s sukuk, or bonds that comply with Shariah law’s ban on interest, returned 6.3 percent and yielded 6.34 percent on Sept. 17.
Speculation is growing that Abu Dhabi, which helped neighboring Dubai avoid a default last year with a $20 billion bailout, may sell its first international securities since April 2009 as the economy expands. Demand for Abu Dhabi’s debt due in 2019 has pushed yields down to 3.86 percent, or 11 basis points less than similar-rated securities from Qatar. Abu Dhabi’s government met investors in Europe last week to brief them on the sheikhdom’s budget and economy, two people familiar with the meetings said.
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