Abu Dhabi’s First Gulf Bank Sukuk to Yield Less Than Dubai Peer - Businessweek

First Gulf Bank PJSC, controlled by the Abu Dhabi ruling family, paid less to raise a $500 million sukuk than Dubai-based Emirates NBD PJSC as investors view Dubai as riskier than its wealthier neighbor.

First Gulf Bank priced its Islamic bond at a coupon of 4.046 percent, the lender said a statement today. That is below the 4.718 percent yield Emirates Islamic Bank, a unit of Emirates NBD, paid on its $500 million sukuk.

"FGB is better capitalized, has lower non-performing loans, and its business mainly stems from a stronger client base," said Gus Chehayeb, associate director of research at Exotix Ltd. in Dubai. "These factors have contributed to its tighter pricing."

* username: rupertbu