Tuesday, 10 January 2012

THE DAILY STAR :: UAE banks may refinance rather than repay debt

Banks in the United Arab Emirates may opt to refinance more than $3 billion of bonds due this year should pricing remain at current levels, as they seek to extend the average maturity of their debt.

UAE banks have about $3.49 billion of bonds and sukuk maturing in 2012, according to data compiled by Bloomberg. Most of this debt is held by the country’s three largest banks, Emirates NBD PJSC, National Bank of Abu Dhabi PJSC and Abu Dhabi Commercial Bank PJSC, the data shows.

An analyst at Rasmala Investment Bank Ltd. in Dubai, Raj Madha said: “$3 billion is a lot to be falling due at any one time, but recent sukuk issues suggest that deals can be done at the right price even in the current difficult international environment.” Banks may prefer to roll over debt to extend maturities even if they have money to repay it, he said.

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